monthly newsletter june, 2018 · on 14th may 2018, mof issued official letter no. 5537/btc-cst as...
TRANSCRIPT
Monthly Newsletter
June, 2018
Audit | Tax | Advisory crowe.vn
Table of Content
Changes to CIT and PIT regulations stipulated in Circular 25/2018/TT-BTC . 1
VAT on land use rights transfer ..................................................................... 2
VAT refund for goods imported and subsequently exported ...........................3
PIT treatment for tuition fees paid for expat’s children.....................................4
Business expense claims of more than VND 20,000,000 .............................. 5
Incremental adjustment to Social insurance and Health insurance since
01/07/2018.......................................................................................................6
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1
Corporate Income Tax / Personal Income Tax
Changes to CIT and PIT
regulations stipulated in Circular
25/2018/TT-BTC
On 16th Mar 2018, MOF issued Circular no. 25/2018/TT-BTC as
guidance for Decree no. 146/2017/NĐ-CP dated 15th December
2017 by Government, and as changes to some articles in Circular
78/2014/TT-BTC dated 18th Jun 2014, Circular 111/2013/TT-BTC
dated 15th August 2018 by MOF. Considerable changes include:
1. Changes to deductible and non-deductible for CIT purpose:
• The transferee of partial capital or the whole business is
allowed to claim depreciation of transferred fixed assets
which qualify for depreciation on residual book value.
• Excess of VND 3,000,000/ month/ person as contribution
to voluntary superannuation fund, voluntary pension
insurance, life insurance for employees; excess of
compulsory social insurance, health insurance,
unemployement insurance are treated as non-deductible
for CIT purpose.
2. Changes to assessable income from stocks trading for PIT
purpose:
• Income from stocks trading include: income from shares
trading, call options, bonds, T-bills, fund certificates and
other type of stocks as stipulated in Clause 1 Article 6 of
Securities Law. “Income from trading shares in a joint
stock company follows regulation at Clause 2 Article 6 of
Securities Law and Article 120 of Corporate Law”.
This circular takes effective on 01st May 2018.
2
Value Added Tax
VAT on land use rights transfer
On 03rd April 2018, Da Nang Tax Department issued Official letter
no. 1159/CT-TTHT as guidance for VAT on land use rights
transfer.
Main principle: as to transfer of real estates, VAT taxable value is
calculated as below: transfer price of real estate minus (-)
deductible cost base of the land for VAT purpose. Details of the
calculation follows regulations at Clause 10 Article 7 Circular
219/2013/TT-BTC dated 31/12/2013 issued by MOF.
Where the company legally received land use rights transfer, and
then wishes to transfer that land use rights to other organidation,
individual:
• Where current price of the land use rights transfer is higher
than historical price (deductible cost base of the land), VAT
taxable value is: transfer price of real estate minus (-)
deductible cost base of the land for VAT purpose.
• Based on VAT taxable value and VAT rate, the company is
required to declare and pay VAT as stipulated at Article 11
Circular no. 156/2013/TT-BTC dated 06/11/2013 which was
amended in Article 15 Circular 151/2014/TT-BTC dated
10/10/2014 by MOF.
3
Value Added Tax
VAT refund for goods imported
and subsequently exported
On 14th May 2018, MOF issued official letter no. 5537/BTC-CST
as guidance on VAT refund for goods imported and subsequently
exported.
• From 01/07/2016 to 31/01/2018, as per clause 6 Article 1
Decree no. 100/2016/NĐ-CP, business entities shall not get
VAT refund for goods imported and subsequently exported.
• From 01/02/2018, business entity that exports goods and
services including: goods imported and and subsequently
exported to non-tariff areas; goods imported and and
subsequently exported to other countries shall be assessed for
VAT refund as per Clause 2 Article 1 Decree no.
146/2017/NĐ-CP.
4
Personal Income Tax
PIT treatment for tuition fees
paid for expat’s children
On the 4th of May 2018, Bac Ninh Tax Department issued official
letter no. 808/CT-TTHT as guidance on PIT treatment for tuition
fees paid for expat’s children. Accordingly:
Where the company enters into labour contracts with foreign
employee, and in that contract, there’s term of tuition fee payment
from kindergarten to high school for that employee’s children; the
payment is made in compliance with regulations of wages and
salary; there’re sufficient documents and invoices; then, it shall be
treated as deductible expense for CIT purpose.
Where the school does not register to use tax invoice, but a
payment request and school’s receipt; then the documents
required are school’s receipt with Company’s business name,
address, tax code and debit note (non-cash). This document
shall be served as basis to treat the expense as deductible for
CIT purpose. Besides, the benefit shall not be treated as
assessable income for PIT purpose.
Such expenditures like admission fees, transportation, meals are
not tuition fees. Those shall not be treated as deductible
expenses for CIT purpose. As to employee, those are assessable
income for PIT purpose.
5
Other
Business expense claims of
more than VND 20,000,000
On 18th April 2018, Binh Duong Tax Department issued Official
letter no. 6480/CT-TT&HT as guidance for reimbursement of
business expense claims.
Where an employee go on a business trip as assigned, and make
payments for expenses over VND 20,000,000 by his/her personal
bank account; then these expenses qualify for non-cash
transactions and shall be treated as deductible expenses for CIT
purpose if satisfying conditions at point 2.9 Article 4 Circular
96/2015/TT-BTC dated 22/06/2015. Upon reimbursement to
employee, the company is not required to adopt non-cash
transaction methods.
6
Other
Incremental adjustment to Social
insurance and Health insurance
since 01/07/2018
On 15th May 2018, the Government issued Decree no.
72/2018/NĐ-CP as to increment of basic salary applicable for civil
servants, officials and armed forces from VND 1,300,000/ month
to VND 1,390,000/month. As a result, Social contribution and
Health insurance shall be adjusted in accordance with new basic
salary.
• Since 01/07/2018, where monthly salary of such people is
higher than VND 27,800,000 (20 times of basis salary),
monthly salary for SHUI purpose is VND 27,800,000.
• Asto employees whose salary structure is determined by
employer, salary for SHUI purpose includes wages,
allowances and other allowances as per labour law.
7
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