Legal update on June 2021 (Part 2)

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Our Vietnam legal update #165 would lead you on 03 legal issues:

I. CIT for loan interest which is written-off and the difference due to revaluation of assets when converting enterprises

The General Department of Taxation issued Official Letter No. 1696/TCT-CS dated 24 May 2021 on guiding CIT for loan interest which is written-off and the difference due to revaluation of assets when converting enterprises.

The regulations related to CIT has specific provisions on taxable income in the tax period, other income (including income from loan interest, the difference due to revaluation of assets), conditions applicable to deductible and non-deductible expenses when determining taxable income subject to CIT (including instructions on loan interest payments). Therefore, in case the enterprise has the payable loan interest, which is written-off by the Bank, the written-off debt shall be accounted as other income to determine the taxable income. The enterprise shall declare and pay tax in the tax period that the debt is written-off.

In case an agriculture enterprise meets the following conditions:

  • The agriculture enterprise is converted into a multi-member limited liability company;
  • The conversion of this enterprise falls into one of the forms of reorganization and renewal of the company as prescribed in Decree No. 118/2014/ND-CP; and
  • The conversion of this enterprise has been agreed upon by the Prime Minister.

Then, the difference due to revaluation of assets when determining the value of the enterprise is not reflected in other incomes in the tax period when determining taxable income.

II. Guiding on granting construction license and managing construction order

Ministry of Construction issued the Official Letter No. 1888/BXD-HDXD dated 26 May 2021 to uniformly give guidance about the application of the law on construction to Provincial People’s Committees. The contents are as follows:

  • The grant, adjustment, extension, re-issuance, and withdrawal of construction licenses for projects with many types of construction and different grades of construction shall be carried out by only one competent authority.
  • Regarding the change in the authority to issue construction licenses due to the project’s design changes leading to the change of construction level, the Provincial People’s Committees need to clearly define the authority and resolving mechanism to avoid additional administrative procedures.
  • Provincial People’s Committees should direct and issue Regulations on construction order management, classify authority to manage construction order, and receive dossiers of notice of commencement of construction for construction eligible of exemption from construction license.

III. Guiding on the procedure of granting, amending Investment Registration Certificate (“IRC”)

The Foreign Investment Department issued the Official Letter No. 188/DTNN-THTT dated 17 May 2021 to guide on the procedures of granting and amending the IRC using digital signatures. The contents are as follows:

  • For investment projects that are not subject to the approval of investment guidelines, investors may choose to apply for issuance, amendment of the IRC by submitting an online application on the National Investment Information System with or without digital signatures.
  • Detailed instructions on filling and uploading electronic documents to the system have been posted to the System in the User Manual section.

For down-loading: 

Legal Update #165 (EN version)

Maybe you are interested in reading other updates: June 2021 (Part 1)May 2021 (Part 4) | May 2021 (Part 3)May 2021 (Part 2)May 2021 (Part 1)April 2021 (Part 5)April 2021 (Part 4)April 2021 (Part 3) | April 2021 (Part 2)April 2021 (Part 1) 


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