Vietnam Holding company
IP holding company
Corporation tax rate 22%.
IP regime? No special regime.
Participation exemption on dividends? No.
Tax rate on IP income No special regime, generally taxed at usual corporate tax rate. However, may be eligible for incentive tax rates.
Participation exemption on capital gains? No, gains are taxable at the standard rate unless the gain is from disposal of securities by a foreign party without a permanent establishment in Vietnam.
Capital gains on IP Capital gain on IP disposal as with other assets.
Interest deductibility? Yes.
IP amortisation deduction Yes, maximum 20 year period.
Transfer pricing rules Yes, transactions between related parties must be on an arm’s length basis.
Other comments
Controlled foreign company regime? No. Local tax on disposal of shares by foreign shareholder? Yes, capital gains taxes apply equally to foreign and domestic shareholders. Disposal of offshore holding companies may be exempt in some cases. Withholding tax on dividends? Yes, 5% for individuals. 0% for corporate entities. Withholding tax on interest? Yes, 5% unless otherwise specified within an applicable treaty. Withholding tax on royalties? Yes, 10% unless otherwise specified within an applicable treaty.
Local currency Vietnamese Dong (VND). Income tax rate Progressive up to 35%. Expatriate regime Personal income tax is applied based on the residency of the individual, and the nature and source of the income. Resident taxpayers are taxed at progressive rates on their worldwide income but eligible to certain deductions and allowances. Non-residents are taxed on flat rates and only on Vietnam-sourced income but generally not eligible to any deductions or allowances. Differing tax rates are applicable to non-employment income. For any further information please contact: Matthew Facey E matthew.facey@vn.gt.com
Number of double taxation treaties 67. Standard VAT rate 10%. Other incentives? Reduced corporate rate and tax holidays may be available.
A global guide to business relocation 133