Tax Policies
Extension of Deadlines for VAT, CIT, PIT, and Land Rental Payment in 2025
- For Value Added Tax (excluding import VAT):
A six-month extension is granted for the VAT payable for February and March 2025, and for the first quarter of 2025; a five-month extension is granted for the VAT payable for April, May, June 2025, and for the second quarter of 2025. The extension period is calculated from the statutory VAT payment deadline.
- For Corporate Income Tax:
A five-month extension is granted for the provisional CIT payable for the first and second quarters of the 2025 CIT tax period.
- For land rental:
An extension is granted for 50% of the 2025 land rental amount payable by enterprises, organizations, households, and individual business households falling under the scope specified in Article 3 of Decree No. 82/2025/ND-CP, who are directly leased land by the State under a Decision or Contract from a competent State authority, in the form of annual land rental payment.
The extension period is six months from May 31, 2025.
Value Added Tax
VAT policy for companies engaged in both export and domestic sales of goods and services
In cases where a business establishment engages in both the export of goods and services, and the domestic sale of goods and services (subject to VAT and exempt from VAT), it must maintain separate accounting for input VAT serving export activities, domestic activities exempt from VAT, and domestic activities subject to VAT.
If separate accounting is not feasible, the input VAT related to export activities that cannot be separately accounted for shall be determined as follows: The business shall determine the deductible input VAT related to VAT-taxable activities that cannot be separately accounted for (serving both export activities and VAT-taxable domestic sales) in accordance with Clause 2, Article 14 of Circular No. 219/2013/TT-BTC (as amended and supplemented in Point a, Clause 9, Article 1 of Circular No. 26/2015/TT-BTC dated February 27, 2015 of the Ministry of Finance).
When determining the input VAT related to export activities that cannot be separately accounted for, the business shall allocate according to the ratio of revenue from exported goods and services to the total VAT-taxable revenue (including VAT-taxable domestic sales revenue and export revenue) for the VAT declaration periods from the period immediately following the most recent tax refund period up to the current tax refund request period.
(Official Letter No. 1089/CT-CS issued by the Tax Department on May 8, 2025)
Corporate Income Tax
CIT incentives for income from subleasing land
Under land law and CIT regulations, if an enterprise earns income from subleasing land:
Regardless of whether there is infrastructure or construction works attached to the land, such activity is still considered a real estate transfer.
Accordingly, such income from subleasing land is classified as income from real estate transfers.
Income from real estate transfer activities must be separately determined and is not eligible for CIT incentives.
(Official Letter No. 1088/CT-CS dated May 8, 2025, of the Tax Department)
Personal Income Tax
PIT policy for severance allowances paid to employees
If a company pays severance allowances to employees in accordance with the applicable subjects and levels stipulated in the Labor Code and the Law on Social Insurance, such income shall not be included in the taxable employment income for PIT purposes, as guided in Sub-point b.6, Point b, Clause 2, Article 2 of Circular No. 111/2013/TT-BTC.
If the severance allowance exceeds the level stipulated in the Labor Code and the Law on Social Insurance, the excess amount must be included in taxable income.
If the company advances severance allowances to employees, it must aggregate such amounts with salaries and wages to withhold PIT before making payment to employees, as guided in Article 25 of Circular No. 111/2013/TT-BTC
(Official Letter No. 12044/CCTKV01-QLDN5 dated May 5, 2025, of the Regional Tax Sub-Department No. 1)
