Tax Exemption for Corporate and Personal Income in Ho Chi Minh City

Government Decree No. 11/2024/NĐ-CP dated February 2, 2024, also specifically stipulates the exemption of corporate income tax and personal income tax in Ho Chi Minh City.

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Tax exemption for corporate income

A decree stipulates that startups, scientific and technological organizations, innovation centers, and intermediary organizations supporting startup innovation (enterprises) with income from startup and innovation activities generated in Ho Chi Minh City are exempt from corporate income tax.

Enterprises eligible for tax exemption must meet the regulations of the Ho Chi Minh City People’s Council regarding priority areas, criteria, conditions, and content of startup and innovation activities.

Corporate income tax and personal income tax exemption in Ho Chi Minh City (Illustration: KT)

The tax exemption period is 5 years from the time when enterprises generate corporate income tax from startup and innovation activities in Ho Chi Minh City during the effective period of Resolution No. 98/2023 / QH until the expiration of the tax exemption period as prescribed in this clause.

In cases where enterprises are in the tax-free period or belong to tax-exempt category under conditions other than prescribed in this Decree, enterprises may choose to enjoy tax exemption under other tax-exempt conditions or enjoy tax exemption under this Decree for the remaining period.

During the effective period of Resolution No. 98/2023 / QH, organizations with income from transferring contributed capital, capital contribution rights to startup and innovation enterprises in Ho Chi Minh City are exempt from corporate income tax on this income.

Startup and innovation enterprises in Ho Chi Minh City as prescribed in this clause must meet the regulations of the Ho Chi Minh City People’s Council regarding priority areas, criteria, conditions, and content of startup and innovation activities.

The income from transferring capital, capital contribution rights specified in this clause is the income obtained from transferring part or all of the capital, capital contribution rights into startup and innovation enterprises in Ho Chi Minh City (including cases of sale of enterprises), except for income from transferring stocks, bonds, fund certificates, and other types of securities as prescribed.

In cases where a limited liability company is sold in whole by an organization owning under the form of capital transfer associated with real estate, the declaration and payment of corporate income tax shall be made according to real estate transfer activities.

In cases where enterprises conduct multiple production and business activities, enterprises determine and account for income from exempted activities according to the provisions of the corporate income tax law.

Enterprises declare and pay taxes according to the provisions of the tax administration law.

Personal income tax exemption

During the effective period of Resolution No. 98/2023 / QH, individuals with income from transferring contributed capital, capital contribution rights to startup and innovation enterprises in Ho Chi Minh City are exempt from personal income tax on this income.

Startup and innovation enterprises in Ho Chi Minh City as prescribed in this clause must meet the regulations of the Ho Chi Minh City People’s Council regarding priority areas, criteria, conditions, and content of startup and innovation activities.

The income from transferring capital, capital contribution rights specified in this clause is the income obtained from transferring part or all of the capital, capital contribution rights into startup and innovation enterprises in Ho Chi Minh City (including cases of sale of enterprises), except for income from transferring stocks, bonds, fund certificates, and other types of securities as prescribed.

In cases where the entire business owned by an individual is sold under the form of capital transfer associated with real estate, the declaration and payment of personal income tax shall be made according to real estate transfer activities.

The determination of income from transferring capital, capital contribution, and declaration with tax authorities shall be carried out in accordance with the personal income tax law, tax administration law.

SOURCEcafef
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