TAX MANAGEMENT – TAX PLANNING IN VIETNAM

PROPERLY COMPLY TO OPTIMIZE YOUR LONG TERM BUSINESS

Tax planning is pivotal in charting the course, establishing principles, and laying the foundation for seamless tax compliance in the years ahead. It encompasses both compliance management and tax expense optimization objectives.

RELEVANT TAX EXPENSES FOR AN ENTERPRISE IN VIETNAM:

1. Value-Added Tax (VAT)
2. Corporate Income Tax (CIT)
3. Personal Income Tax (PIT)
4. Foreign Contractor Tax (FCT)
5. Capital Assignment Profits Tax
6. Natural Resources Tax
7. Property Taxes
8. Environment Protection Tax
9. Import and Export Duties
10. Social, Health and Unemployment Insurance Contributions
11. Tax Audits and Penalties

TAX COMPLIANCE AND TAX EXPENSE OPTIMIZATION SOLUTIONS

Tax Compliance

1. Recording and declaration of taxable revenue.
2. Recording and declaration of deductible expenses before tax payments.
3. Legal corporate documents aligning business lines with revenue and expense-generating transactions.
4. Documents establishing eligibility for tax incentives.
5. Compliance with reporting, invoice, document, accounting book, and financial reporting regulations.

Tax Expense Optimization Solutions:

1. Precise declaration to prevent accumulated tax audits and penalties in the future.
2. Application of regulations on tax exemptions, deductions, refunds, and non-taxable conditions; tax debt charge-offs; tax debt, overdue interest, and penalty written-offs; overdue interest and penalty waive; non-imposing overdue interest; extension of tax payment deadlines; and payment of tax debts in installments.
3. Proper application of regulations on tax calculation bases and deductible expenses to minimize taxable income and maximize deductions.
4. Tax planning based on investment, revenue, and cost projections; and tax expense balancing across various tax categories.
5. Creation of tax shields based on financial costs, investment costs, and related-party transactions.

COMPREHENSIVE TAX MANAGEMENT FOR AN ENTERPRISE’S LONG-TERM BUSINESS OPERATIONS IN VIETNAM

Internal Auditing:

Internal auditing helps identify overall compliance status and tax risks to facilitate a proactive tax planning approach. Internal auditing encompasses the following key aspects:

1. Evaluation of legal documents, investment projects, and eligibility for tax incentives based on industry and investment region-specific criteria
2. Control of tax compliance in terms of quantity, form, and content of original documents, accounting books, and business reports from December 2021 to June 2023.
3. Reassessment of the entire business operations with respect to each transaction; methods to establish legal and optimized relationships between transactions; methods to complete valid documentation for each transaction; and methods to optimize tax liabilities as well as address and mitigate potential risks.
4. Data review: review of the accuracy of each transaction and accounting data, consistency between such data, and alignment with other compliance standards.
5. Evaluation of methods to establish compliance documents within business operations in accordance with current regulations, including lists of licenses, personnel records, labor and payroll records, tax declarations, income-expenditure records, invoices, and documents, and guidance on compliance standards for each record.
6. Evaluation of the arrangement and organized storage of documents to facilitate management information and meet government authority requirements promptly.

Tax Planning:

Tax planning is pivotal in charting the course, establishing principles, and laying the foundation for seamless tax compliance in the years ahead. It encompasses both compliance management and tax expense optimization objectives.

1. Analysis of legal position, business lines, and business plans related to taxable revenue and input costs.
2. Budget estimation for different tax categories based on actual business operations.
3. Identification of potential tax incentives and reductions
4. Balancing and optimization of tax expenses across different tax categories.
5. Creation of sales and cost plans for affiliates
6. Establishment of optimal tax budgets
7. Formulation of processes, forms, and rules for transaction identification and documentation for each transaction.
8. Management of tax declaration and payment in compliance with regulations and plans.
9. Proactively obtaining guidance and guarantees from regulatory authorities
10. Regular internal audits and tax reconciliations.

VIVA BUSINESS CONSULTING’S TAX MANAGEMENT SERVICES

1.  Tax Management and Management of Compliance Procedures with Government Agencies

   • Conducting internal audits and tax planning, including evaluating related tax categories, compliance records, tax status, tax planning, incentives, and tax-related risks, ensuring the legality and validity of issued invoices.
   • Providing expert advice and organizing and managing the business records system
   • Coordinating the preparation and submission of comprehensive compliance reports, including value-added tax (VAT), personal income tax (PIT), corporate income tax (CIT), withholding tax, etc.;
   • Coordinating the control of supporting documents for each transaction, developing accounting book systems, and preparing financial statements in strict adherence to regulatory requirements;
   • Managing labor relations with employees, insurance agencies, and tax authorities;
   • Taking charge of periodic reports as required by the tax, business registration, and labor authorities;
   • Acting as the representative for clients in regular interactions with government agencies or on specific matters. Providing support in liaising with banks and partners concerning relevant data and reports;
   • Conducting periodic or requested internal audits of records, documents, and data to meet diverse compliance requirements. Preparing quarterly or annual management letters to report data, operating results, potential risks, and preventive measures to the Management Board;
   • Offering expert guidance on transactional matters and handling emerging issues related to daily operations and at the specific requests of the Management Board;

2. Consultancy on Internal Management

   • Corporate Financial Management:

     • Evaluating total capital and assets engaged in operations
     • Assessing the capital structure, including equity, loans, and other capital sources
     • Analyzing cash flow, cost of capital, and actual business performance;
     • Developing strategic plans for capital raising, capital mobilization, capital transfer, and cost of capital optimization.

   • Corporate Legal Records Management:

     • Legal entity records
     • Ownership records
     • Company Charter
     • Records of capital contribution and ownership rights within the company
     • Records of intellectual property rights, trademarks, and business locations

   • Shareholder Relationship Management

     • Ownership and governance rights
     • Internal decision-making mechanisms
     • Internal conflict prevention
     • Conflict of interest prevention
     • Inheritance, share transfers, and changes in shareholder structure

   • Human Resources Management

     • Wage regulations
     • Internal labor regulations and disciplinary procedures
     • Collective labor agreements
     • Organizational charts and job positions
     • Standardized templates for labor contracts

3. Due Diligence and Conflict Management Services

   • Senior Management Due Diligence

     • Criminal record certificates
     • Employment history
     • Professional qualifications
     • Financial capabilities
     • Competitive factors and conflicts of interests

   • Clients and Partners Due Diligence:

     • Legal entity records
     • Credit records of business individuals
     • Compliance with relevant business laws and regulations
     • Litigation history, restraining orders, seizures, or obligations to third parties
     • Financial capabilities

   • Business Conflict and Dispute Resolution

     • Collecting and analyzing all relevant documents to the case
     • Assessing the case’s impact and legal basis
     • Developing optimal solutions that protect your business’ legitimate rights and interests
     • Creating an action plan for conflict resolution
     • Providing ongoing support throughout the implementation process

 

We look forward to your consideration and acceptance.

 

Read more:

• FDI companies in Vietnam – Managing the required compliance procedures
• Using business management advisory services to manage risks and create competitive advantages
• Business compliance management advisory services
• Tax compliance procedures – Exclusive notices for CEO
• Investment in Vietnam – Incentives on corporate income tax (CIT)
• Important notices regarding the methods of personal income tax declaration in Vietnam
• Personal income tax (PIT) – Annual pit settlement key notes
• Taxable incomes from wages and remunerations
• Doing business in Vietnam – Internal salary and wages policy
• Labor compliance procedures – Registration internal labor regulations
• Doing business in Vietnam – Business records management