Decree 320/2025/ND-CP (Decree 320 2025 ND-CP): Corporate Income Tax Guidance 2025

GACC summarizes Decree 320/2025/ND-CP (Decree 320 2025 ND-CP), issued on 15 December 2025, guiding the 2025 Corporate Income Tax Law and its application from the 2025 tax period.

This page is for enterprises, accountants, and tax advisors who need quick reference to taxable income, deductible expenses, tax rates, incentives, and loss carryforward rules.

References: Ministry of Finance and Thu vien Phap luat.

• Effective date, scope of regulation, and subjects of application.
• Taxable income, deductible/non-deductible expenses, and tax base principles.
• Standard CIT rate 20% and preferential 15%-17% for SMEs; revenue-based method.
• Tax incentives, loss carryforward, transitional provisions, and effective date.

Scroll down to read the full details.

1. Overview of Decree 320/2025/ND-CP (Decree 320 2025 ND-CP)

On 15 December 2025, the Government issued Decree No. 320/2025/ND-CP detailing a number of provisions and measures to organize and guide the implementation of the Corporate Income Tax Law No. 67/2025/QH15.

Decree 320 is a legal instrument with direct applicability and serves as a basis for:

• Taxpayers to determine their corporate income tax (CIT) obligations;
• Tax authorities to conduct inspections, examinations, and tax assessments;
• Resolving issues and disputes related to corporate income tax.

From the effective date of Decree 320, the application of CIT regulations must prioritize compliance with the 2025 Corporate Income Tax Law and Decree 320.

2. Scope of Regulation and Subjects of Application

2.1. Scope of regulation

Under Decree 320/2025/ND-CP, this Decree provides detailed regulations and guidance for the implementation of the main contents of the Corporate Income Tax Law, including:

• Determining income subject to tax and taxable income for corporate income tax;
• Principles for determining revenue, deductible expenses, and non-deductible expenses when calculating CIT;
• Regulations on corporate income tax rates;
• Conditions, levels, and duration of corporate income tax incentives;
• Principles for determining CIT obligations for production and business activities and other income of enterprises.

Legal basis: Clause 1, Article 1 of Decree 320/ND-CP

2.2. Subjects of application

Decree 320/2025/ND-CP applies to:

2.2.1. Taxpayers under Clause 1, Article 2 of the Corporate Income Tax Law (hereinafter referred to as enterprises) include:

• Enterprises established and operating under the Law on Enterprises, the Law on Investment, the Law on Insurance Business, the Law on Securities, the Law on Petroleum, the Commercial Law, international treaties, and other legal documents;
• Enterprises established under foreign law (hereinafter referred to as foreign enterprises) with a permanent establishment or without a permanent establishment in Vietnam;
• Public service units established under Vietnamese law;
• Cooperatives and cooperative unions established under the Law on Cooperatives;
• Economic organizations established and operating under the Law on Credit Institutions;
• Other organizations not listed above that have production or business activities with income subject to tax under Article 3 of this Decree;

2.2.2. Organizations established and operating (or registered) under Vietnamese law (including operators of e-commerce exchanges and digital platforms)

• Are taxpayers in cases of paying tax on behalf when the Vietnamese party purchases services (including services attached to goods, or goods supplied and distributed in the form of on-the-spot export/import or under international commercial terms (Incoterms)), engages in e-commerce business, digital platform-based business, or receives capital transfers under contracts with foreign enterprises as specified at points b2, b3 and b4 Clause 1 Article 2; fund management companies of securities investment funds act as taxpayers on behalf of investors when the securities investment fund distributes dividends to investors as provided in Clause 3 Article 14 and are taxpayers for income from transfer or lease of real estate of real estate investment funds as provided in Clause 6 Article 15 of this Decree; if the transferee of capital of a foreign enterprise is a foreign organization or individual, the taxpayer is the enterprise established under Vietnamese law where those foreign organizations invest capital.

2.2.3. A permanent establishment of a foreign enterprise specified at point b Clause 1 Article 2 is a production or business establishment through which a foreign enterprise conducts part or all of its production or business activities in Vietnam, including:

• Branch, executive office, factory, workshop, means of transport, oil well, gas well, mine, or other natural resource extraction site in Vietnam;
• Construction site, construction works, installation, assembly;
• Service establishment, including consultancy services through employees or other organizations or individuals;
• Agent for a foreign enterprise;
• Representative in Vietnam in cases where the representative is authorized to sign contracts in the name of the foreign enterprise, or where the representative is not authorized to sign contracts in the name of the foreign enterprise but regularly delivers goods or provides services in Vietnam;
• An e-commerce platform or digital platform through which the foreign enterprise supplies goods or services in Vietnam.

Details on subjects of application are specified in Article 2 of Decree 320/2025/ND-CP.

2.3. Highlights in this section

Tax payment on behalf: Vietnamese organizations must pay tax on behalf of foreign enterprises when purchasing services, engaging in e-commerce business, or receiving capital transfers under contracts.

Permanent establishment (PE): Includes branches, executive offices, factories, construction sites, service establishments, agents, and also e-commerce platforms/digital platforms through which foreign enterprises operate in Vietnam.

3. Income Subject to Tax and Taxable Income under Decree 320

3.1. Income subject to tax

Income subject to corporate income tax is determined in accordance with the Corporate Income Tax Law and guided in detail by Decree 320, including:

• Income from production and business activities of goods and services;
• Other income as prescribed by tax law.

The determination of income subject to tax must be based on the economic substance of transactions, not solely on legal form.

Some notable other income items:

• Income from capital transfer, securities transfer, transfer of contribution rights, real estate (except income from real estate transfer of real estate business enterprises).
• Income from transfer of investment projects, transfer of the right to participate in investment projects, and transfer of rights to explore, exploit, and process minerals in accordance with law.
• Income from intellectual property rights and technology transfer.
• Income from deposit interest, loan interest, and foreign currency sales.
• Exchange rate differences (excluding year-end revaluation of cash and receivable balances).
• Gifts in cash or in kind.

Legal basis: Article 3 of Decree 320/ND-CP

 

3.2. Income subject to tax and offsetting within the tax period

• If an enterprise has multiple production and business activities in a tax period, income subject to tax from production and business is the total income of all production and business activities.
• If an enterprise has a loss from a production or business activity, it may offset the loss against income subject to tax from other production and business activities with income, at the enterprise’s discretion, except as provided in Clause 3 and Clause 4 Article 6 of this Decree.

The remaining income subject to tax after offset is subject to the corporate income tax rate applicable to the production or business activity that has income.

• If an enterprise incurs a loss from real estate transfer, transfer of investment projects, or transfer of rights to participate in investment projects, such loss may not be offset against income subject to tax from production and business activities that are enjoying tax incentives and have income.
• Income subject to tax from transfer of investment projects for mineral exploration, exploitation and processing; transfer of the right to participate in investment projects for mineral exploration, exploitation and processing; and transfer of rights to explore, exploit and process minerals must be determined separately for tax declaration and payment, and may not be offset between losses and gains with production and business activities in the tax period.

Legal basis: Article 6 of Decree 320/ND-CP

3.3. Tax-exempt income

The Decree specifies tax-exempt cases to encourage investment:

• Agriculture: Income from cultivation, livestock, and aquaculture in areas with extremely difficult socio-economic conditions; income from technical services directly serving agriculture, etc.
• Science and technology: Income from scientific research contracts, technology development, innovation, and digital transformation (tax exempt for up to 3 years from the time income arises), etc.
• Environment and social: Income from first-time transfer of carbon credits; interest on green bonds; income of enterprises employing many workers with disabilities or HIV, etc.
• Education and health: Undistributed income of socialized entities retained for development investment (minimum 25%), etc.
• Other tax-exempt income is detailed in Article 4 of this Decree.

Legal basis: Article 4 of Decree 320/ND-CP

3.4. Taxable income (for tax calculation)

Decree 320 confirms the principle for determining taxable income as follows:

Taxable income for tax calculation = Income subject to tax – Tax-exempt income – Losses carried forward in accordance with regulations

In which:

• Taxable income for tax calculation cannot be negative;
• If income subject to tax is negative, taxable income for tax calculation is determined as 0;
• Losses incurred may be carried forward continuously for a maximum of 5 years, in accordance with the Corporate Income Tax Law.

This provision ensures that corporate income tax obligations are determined consistently, transparently, and with controllability.

4.  Deductible and Non-deductible Expenses in Determining Taxable Income

4.1.  Principles for determining deductible expenses

Under Decree 320, deductible expenses when determining income subject to tax must satisfy all of the following conditions:

• Actual expenses incurred related to the enterprise’s production and business activities, including additional deductible expenses calculated as a percentage of actual expenses incurred in the tax period related to the enterprise’s research and development activities;
• Expenses with sufficient invoices and documents as prescribed by law.
• Expenses with non-cash payment documents for purchases of goods and services and other payments each time with a value of VND 5 million or more (calculated per transaction or in total within the day for the same seller). Non-cash payment documents are implemented in accordance with legal documents on value-added tax.

Note: Tax authorities have the right to review the substance, necessity and actual economic value of expenses, not merely the form of documents.

Legal basis: Clause 1 Article 9 of Decree 320/ND-CP

 

4.2.  Some deductible expenses when determining taxable income

• Research & Development (R&D): May be included as deductible expenses up to no more than 200% of actual expenses incurred (provided that after applying the additional deduction, the enterprise does not incur a loss).
• For the following cases:

+ Purchase of agricultural, forestry, and aquatic products directly sold by producers or harvesters;

+ Purchase of handicraft products made from jute, sedge, bamboo, rattan, leaves, rush, cane, straw, coconut husk, coconut shell, or materials recycled from agricultural products directly sold by handicraft producers;

+ Purchase of scrap from direct collectors;

+ Purchase of items and assets from households or individuals directly selling;

+ Purchase of goods and services from individuals or household businesses (excluding the cases above) with revenue below the VAT threshold.

For the above cases, when a transaction occurs there must be payment vouchers in accordance with laws on accounting, invoices and documents for the seller (for purchases of goods and services in a day from each household or individual with a value of VND 5 million or more, payment must be non-cash) and a purchase list of goods and services signed and accountable by the enterprise’s legal representative or authorized person for signing and taking responsibility.

• Employee welfare: Total expenses of a welfare nature (funerals, weddings, vacations, voluntary insurance, etc.) must not exceed 1 month of the average actual salary paid in the tax year.
• Expenditure for vocational education and training for employees includes: payments to instructors, learning materials, equipment used for vocational education activities, practical materials, other support costs for learners; training costs for employees newly recruited to work at the enterprise; training, retraining, and professional development costs for employees working at the enterprise.

These education and training activities must be specified in detail in one of the following documents: labor contract, collective labor agreement, or the enterprise’s financial regulations;

• Donations for education, healthcare, culture, prevention and response to and remedying consequences of natural disasters and epidemics, building great unity houses, gratitude houses, and houses for policy beneficiaries as prescribed by law; donations under regulations of the Government or the Prime Minister for localities with extremely difficult socio-economic conditions; donations for scientific research, technology development and innovation, digital transformation.
• Expenditure for scientific research, technology development and innovation, digital transformation.

The determination of expenditures for scientific research, technology development and innovation, and digital transformation under this point shall comply with laws on science and technology and innovation, and laws on digital transformation;

• The value of losses due to natural disasters, epidemics and other force majeure cases not compensated.
• Some expenses serving the enterprise’s production and business but not yet corresponding to revenue arising in the period, including:

+ Costs incurred by the bidder for participating in a tender but not winning;

+ Costs of market research, product and service research for preparing the production of new products and services; investment costs for development projects of new products and services that are unsuccessful or discontinued.

The enterprise may include as deductible expenses the costs specified at this point when it has a market development or product/service development research report sent to relevant state management agencies in accordance with specialized laws. If specialized law does not require submission, the report shall be kept at the enterprise;

+ Land rent and infrastructure management/maintenance costs paid to infrastructure business enterprises in economic zones, high-tech zones, high-tech agricultural zones, concentrated digital technology zones, industrial zones, industrial clusters; land rent paid to the State for State-leased land where such land and infrastructure must be the enterprise’s production or business location in cases where the enterprise has not yet participated in production or business activities;

+ Depreciation or gradual allocation of expenses according to regulations for leased assets during the period when there is no lessee.

If an enterprise has assets for lease but has not yet had any lessees, and the assets are under the enterprise’s lawful ownership or right to use, the enterprise may include as deductible expenses the costs related to these assets during the period with no lessee;

+ Costs of establishing an enterprise or branch, dependent unit, or business location; restoration costs after temporary suspension of production or business (not capital expenditures to form fixed assets); costs of restoring the original condition under the contract before termination of the enterprise’s production or business or termination of a branch, dependent unit, or business location;

+ Product/service introduction and marketing expenses before sales.

An enterprise may include as deductible expenses the costs specified at this point when it has an investment policy report on production of products and services sent to relevant state management agencies in accordance with specialized laws. If specialized law does not require submission, the report shall be kept at the enterprise;

+ Costs of destroying damaged inventory due to changes in natural biochemical processes, obsolete fashion, obsolete technology, outdated goods, expired goods, goods no longer usable, goods not eligible for circulation on the market due to specialized laws; costs of destroying raw materials, materials, and components no longer needed. Destruction costs include the value of destroyed goods at cost (excluding any provision made (if any)) and costs related to the destruction activity;

+ Costs of destroying assets due to damage and no longer needed. Destruction costs include the remaining book value at the enterprise and costs related to the destruction activity;

+ Costs of destroying scrap and by-products arising in processing and production.

The enterprise must retain and provide full records related to the expenses in this section to serve inspection and examination in accordance with law;

• Other deductible expenses are specifically listed in Article 9 of this Decree.

4.3.  Some non-deductible expenses when determining taxable income

Non-deductible expenses when determining taxable income are implemented in accordance with Clause 2 Article 9 of the Corporate Income Tax Law, specifically as follows:

• Expenses that do not satisfy all conditions prescribed in Clause 1 Article 9 of this Decree.
• Administrative fines including: violations of traffic law, violations of business registration regulations, violations of accounting regulations, tax law violations including late payment of tax under the Law on Tax Administration, and other administrative fines as prescribed by law.
• Expenses compensated by other funding sources; expenses already paid from the enterprise’s Science and Technology Development Fund, the enterprise’s Science and Technology and Innovation and Digital Transformation Development Fund.
• The portion of expenses exceeding prescribed limits for the following expenses:

+ The portion of business management expenses allocated by a foreign enterprise to its permanent establishment in Vietnam exceeding the level calculated according to the following formula:

+ The portion of expenses related to hiring management for prize-winning electronic games and casino business exceeding 4% of revenue from prize-winning electronic games and casino business;

+ Interest payments on loans of enterprises with related-party transactions as prescribed by tax administration regulations for enterprises with related-party transactions;

• The portion of spending on direct employee welfare exceeding one month of the average actual salary paid in the tax year, including:

+ Bereavement and wedding expenses for the employee and the employee’s family;

+ Vacation expenses;

+ Support for medical examination and treatment;

+ Support for additional learning at educational institutions and vocational education establishments;

+ Support for families of employees affected by natural disasters, epidemics, accidents, or illness;

+ Rewards for employees’ children with good academic achievements;

+ Travel expense support for employees during holidays and Tet;

+ Accident insurance (excluding compulsory accident insurance under specialized laws), health insurance, and other voluntary insurance for employees (excluding contributions to supplementary pension insurance under the Law on Social Insurance, life insurance purchased for employees, and voluntary pension insurance for employees);

+ And other welfare expenditures

• Setting up and using provisions not in accordance with regulations on provisioning: provisions for inventory devaluation, impairment of financial investments, doubtful debts, warranty provisions for products, goods, and construction works, and professional risk provisions of valuation enterprises and independent audit service enterprises.
• Depreciation of fixed assets in any of the following cases:

+ Depreciation of fixed assets not used for the production or business of goods and services.

Fixed assets serving employees at the enterprise, including: break rooms, mid-shift dining rooms, changing rooms, toilets, medical rooms or stations for examination and treatment, vocational education and training facilities, libraries, daycare centers, sports areas, and eligible equipment and interiors installed in these facilities; clean-water tanks, parking facilities; employee shuttle vehicles; housing provided directly for employees; costs of constructing facilities and purchasing machinery and equipment that are fixed assets used to organize vocational education and training and other assets used directly for employees at the enterprise, are depreciable and deductible when determining taxable income;

+ Depreciation of fixed assets without documents proving the enterprise’s ownership (except finance-lease fixed assets);

+ Depreciation of fixed assets that are not managed, tracked, and accounted for in the enterprise’s accounting books under the current fixed-asset management and accounting regime;

+ Depreciation that is not in accordance with or exceeds the limits prescribed by the Minister of Finance on the management, use, and depreciation of fixed assets, specifically as follows:

Enterprises shall depreciate fixed assets in accordance with the Minister of Finance’s regulations on the management, use, and depreciation of fixed assets, including accelerated depreciation, but must ensure profitable operations;

For assets such as tools, instruments, and circulating packaging that do not meet the criteria to be classified as fixed assets (including tools, instruments, and circulating packaging that do not meet fixed-asset criteria used for employees as mentioned in point a of this clause), the purchase cost of such assets is allocated gradually to production and business expenses in the period, but for no more than 03 years;

+ Depreciation for fixed assets that have been fully depreciated, except where the competent authority permits revaluation

• Some specific cases are determined as follows:

+ The following are not deductible when determining taxable income:

Depreciation corresponding to original cost exceeding VND 1.6 billion per vehicle for passenger cars with 9 seats or fewer (except cars used for passenger transport business, tourism business, hotels; cars used as models and test drives for automobile business);

Depreciation for fixed assets such as airplanes, helicopters, gliders, and yachts that are not used for cargo transport, passenger transport, tourism business, or hotels.

If an enterprise transfers or liquidates passenger cars with 9 seats or fewer, the residual value of the car is determined as the actual original cost of the fixed asset minus accumulated depreciation under the fixed-asset management and depreciation regime up to the time of transfer or liquidation.

Passenger cars with 9 seats or fewer used exclusively for passenger transport, tourism, and hotel business are cars registered in the enterprise’s name where the enterprise’s business registration certificate includes one of the following sectors: passenger transport, tourism business, or hotel business, and it holds the required business license under laws on transport, passenger transport, tourism, and hotels. Airplanes, helicopters, gliders, and yachts not used for cargo transport, passenger transport, or tourism business are those owned by enterprises that register and account for fixed-asset depreciation but whose business registration certificates do not register cargo transport, passenger transport, tourism business, or hotel business;

+ For buildings on land used both for production/business and for other purposes, depreciation is not deductible for the portion of the building value corresponding to the area not used for production/business or not used to serve employees at the enterprise as prescribed in point a of this clause.

Enterprises may depreciate and deduct expenses when determining taxable income in accordance with the depreciation rate and useful life prescribed by the Minister of Finance for buildings on land such as offices, factories, and shops serving the enterprise’s production and business activities, if the following conditions are met: a land use rights certificate in the enterprise’s name (where the land use right belongs to the enterprise) or a land lease/borrow contract between the enterprise and the land owner, with the enterprise representative responsible before the law for the contract’s accuracy (where the land is leased or borrowed); invoices for payment of construction volume delivered under the construction contract, contract liquidation (if any), and settlement of construction value showing the enterprise’s name, address, and tax code; and the building is managed, tracked, and accounted for under current fixed-asset management regulations;

+ Where fixed assets owned by the enterprise are used for production and business but must be temporarily suspended due to seasonal production for a period of less than 09 months; temporarily suspended for repair, relocation, maintenance, or periodic servicing for a period of less than 12 months, and thereafter the fixed assets are put back into production and business, then during the suspension period the enterprise may depreciate and the depreciation expense during the suspension period is deductible when determining taxable income.

The enterprise must retain and provide full records and the reasons for the suspension of fixed assets when required by the tax authority;

+ Long-term land use rights are not depreciated or amortized into deductible expenses when determining taxable income. Land use rights with a term, if supported by adequate invoices/documents and in compliance with law and used in production and business, may be amortized into deductible expenses over the permitted land-use term stated in the land use rights certificate or the land lease term in the land allocation/land lease contract (including cases of new construction, suspension for repair, or new investment/construction).

Where an enterprise purchases tangible fixed assets such as houses or structures attached to long-term land use rights, the value of the land use rights must be separated and recognized as an intangible fixed asset; the original cost of the tangible fixed asset (house/structure) is the actual purchase price plus directly related costs to bring the tangible fixed asset into use. The value of the land use rights is determined based on the price stated in the real estate (asset) purchase contract, consistent with market price but not lower than the land price in the land price table issued by the provincial/municipal People’s Committee at the time of purchase. Where the land use rights value cannot be separated, it is determined according to the land price in the land price table issued by the provincial/municipal People’s Committee at the time of purchase.

Where an enterprise transfers part of its capital or transfers another enterprise in accordance with law, if assets are transferred, the transferee enterprise may only depreciate those transferred fixed assets that meet depreciation conditions based on the net book value in the transferor’s accounting books.

• Pre-accrued expenses by term or cycle that by the end of the term/cycle have not been spent or not fully spent, as follows:

+ Pre-accrued amounts include: provisions for major repairs of fixed assets under accounting law; provisions for activities where revenue has been recognized but obligations continue to be performed under contracts (including cases where the enterprise has long-term asset leasing or service business with advance payments from customers and has recognized all revenue in the year of receipt) and other provisions;

+ Where the enterprise has production and business activities with revenue recognized for corporate income tax purposes but has not yet incurred all related expenses, it may accrue expenses into deductible expenses corresponding to the recognized revenue when determining taxable income. Upon contract completion, the enterprise must accurately determine actual expenses based on valid invoices/documents incurred to adjust expenses upward (if actual expenses exceed accrued expenses) or downward (if actual expenses are lower than accrued expenses) in the tax period in which the contract ends.

• Expenses for employees in one of the following cases:

+ Salary, wages, and other payable amounts to employees that were accounted for as production/business expenses in the period but were not actually paid or lack payment documents as required by law;

+ Salary, wages, and bonuses for employees that do not clearly specify eligibility conditions and amounts in one of the following documents: labor contracts; documents of a foreign enterprise assigning employees to work in Vietnam (for cases of intra-group secondment or transfer between parent and subsidiary); collective labor agreements; the company’s/parent company’s/group’s financial regulations; bonus regulations issued by the Chairman of the Board of Directors, CEO, or Director pursuant to the company’s/parent company’s/group’s financial regulations.

Where an enterprise signs labor contracts with foreign employees that include expenses for their children’s tuition in Vietnam from preschool to high school, such expenses paid by the enterprise are considered salary/wages and are deductible if supported by adequate invoices/documents as required;

Where an enterprise signs labor contracts with employees that include housing expenses paid by the enterprise, such expenses are considered salary/wages and are deductible if supported by adequate invoices/documents as required;

Where a Vietnamese enterprise signs a contract with a foreign enterprise that clearly states the Vietnamese enterprise must bear accommodation costs for foreign experts during their assignment in Vietnam, the house rent paid by the Vietnamese enterprise for those foreign experts working in Vietnam is deductible when determining taxable income;

+ Salary, wages, and allowances payable to employees that remain unpaid after the deadline for filing the annual tax finalization dossier; except where the enterprise has set aside a wage reserve fund. The annual reserve level is decided by the enterprise but must not exceed 17% of the actual payroll;

Setting aside a wage reserve fund must ensure that after the reserve is made, the enterprise is not in a loss position; if the enterprise is in loss, it may not set aside the full 17%. If in the prior year the enterprise set aside a wage reserve fund but after 6 months from the end of the tax period the reserve has not been used or has not been fully used, the enterprise must reduce expenses of the following year accordingly;

+ Salary and wages of the owner of a sole proprietorship or the owner of a single-member limited liability company owned by an individual; remuneration paid to founders and members of the Members’ Council or the Board of Directors who do not directly participate in production and business management;

+ Uniform expenses in kind for employees without invoices/documents. Uniform expenses paid in cash to employees exceeding VND 5 million per person per year.

Where the enterprise provides both cash and in-kind uniforms to employees and wants them to be deductible, the maximum deductible cash amount is VND 5 million per person per year; in-kind uniforms must have invoices/documents;

+ Rewards for initiatives or improvements where the enterprise has no specific regulations on such rewards and no acceptance/verification council for initiatives/improvements;

+ Travel allowances for annual leave not in accordance with the Labor Code;

+ Allowances for business trips, travel expenses, and accommodation for employees on business trips, if supported by adequate invoices/documents, are deductible when determining taxable income. Where an enterprise assigns employees on business trips (domestic or overseas) and expenses of VND 5 million or more are paid by the individual via non-cash payment services, such payments are deemed the enterprise’s non-cash payment method and are deductible if the following conditions are met: invoices/documents as required by accounting and invoicing laws issued by the goods/service provider; the enterprise has a decision or written assignment for the business trip; the enterprise’s financial or internal regulations permit the employee to pay business trip expenses or buy tickets via non-cash payment services and the enterprise subsequently reimburses the employee.

Where an enterprise provides lump-sum travel, accommodation, and allowance payments for employees on business trips in accordance with its financial or internal regulations, such lump-sum payments are deductible;

+ The following deductible expenses, but if spent for the wrong beneficiaries or purposes:

Additional expenses for female employees, including: costs for retraining when prior jobs are no longer suitable and must be changed under the enterprise’s development plan, including tuition (if any) plus wage grade/step differences (ensuring 100% salary during study); salaries and allowances (if any) for teachers at daycare/kindergartens organized and managed by the enterprise; additional health check costs in the year such as occupational disease checks, chronic disease checks, or gynecological checks for female workers; support for female employees after childbirth; overtime allowances for female employees who, for objective reasons, do not take maternity/childcare leave but continue working, paid under current regulations, including cases of piece-rate pay where female employees still work during the period of not taking leave;

Additional expenses for ethnic minority employees that are deductible include: tuition (if any) plus wage grade/step differences (ensuring 100% salary during study); housing support, social insurance, and health insurance for ethnic minority employees where such costs have not been supported by the State under applicable regimes;

+ Payments of redundancy allowance, severance allowance, compensation or allowances for employees suffering work accidents or occupational diseases not in accordance with regulations;

+ Expenses for golf club membership cards and golf playing expenses.

• Interest expense corresponding to the outstanding charter capital (for sole proprietorships, the investment capital) not yet contributed according to the contribution schedule in the enterprise charter, where the contribution schedule does not exceed the capital contribution deadline under the Law on Enterprises, including cases where the enterprise has already started production and business; and interest expense during the investment period already recorded in the investment value of assets or construction works.

+ Where the enterprise has fully contributed charter capital, interest expense on borrowings to invest in other enterprises is deductible when determining taxable income;

+ Interest expense corresponding to the outstanding charter capital per the contribution schedule in the enterprise charter, where the contribution schedule does not exceed the contribution deadline under the Law on Enterprises, is not deductible and is determined as follows:

– If the loan amount is less than or equal to the outstanding charter capital, all loan interest is non-deductible;

– If the loan amount exceeds the outstanding charter capital according to the contribution schedule: if the enterprise has multiple loans, the non-deductible interest equals the ratio (%) of outstanding charter capital to total loans multiplied by total loan interest; if the enterprise has only one loan, the non-deductible interest equals the outstanding charter capital multiplied by the loan interest rate and multiplied by the period of outstanding capital contribution.

• Interest expense on production/business loans from non-credit institutions exceeding the maximum rate prescribed by the Civil Code.
• Input VAT that has been credited or refunded; VAT paid under the credit method; input VAT of passenger cars with 9 seats or fewer exceeding the deductible threshold under VAT regulations; corporate income tax, except where the enterprise pays corporate income tax on behalf of a foreign enterprise and under the contract the foreign enterprise’s revenue excludes corporate income tax; personal income tax, except where labor contracts stipulate that wages are net of personal income tax; late-payment interest under tax administration law.

The VAT paid under the credit method mentioned above does not include output VAT on gifts or free goods under VAT law for the enterprise’s production/business activities; VAT arising on goods/services used for donations under point d clause 2 Article 9 of this Decree; and input VAT on goods/services directly related to production/business that has not been fully credited and does not fall under VAT refund. If input VAT has been included in deductible expenses, it cannot be credited against output VAT.

• Electricity and water payments for contracts signed directly by the owner (an organization, household, or individual) with the electricity/water provider for leased production/business premises, without sufficient documents, in one of the following cases:

+ Where the enterprise leases production/business premises and pays electricity/water directly to the provider without electricity/water invoices and a premises lease contract;

+ Where the enterprise leases production/business premises and pays electricity/water to the lessor without payment documents for electricity/water to the lessor consistent with actual electricity/water consumption and the premises lease contract.

• The portion of fixed-asset rental expense exceeding the allocation based on the number of years for which the lessee pays in advance.

+ For repair/upgrade costs of leased fixed assets where the lease contract assigns the lessee responsibility for repair/upgrade during the lease term, such costs may be expensed or amortized into expenses, but the maximum period is 03 years;

+ Where the enterprise incurs expenses to acquire assets that are not fixed assets, such as purchasing and using technical documents, patents, technology transfer licenses, trademarks, goodwill, or brand use rights, those expenses are amortized into business expenses but for no more than 03 years;

+ Where the enterprise contributes capital with the value of goodwill or brand use rights, the value of such goodwill or brand use rights contributed as capital is not deductible when determining taxable income.

• Foreign exchange losses arising from revaluation of monetary items denominated in foreign currency at the end of the tax year, including exchange differences from revaluing ending balances of cash, deposits, cash in transit, and foreign-currency receivables (excluding exchange losses from revaluing foreign-currency payables at year-end).

+ During the production and business stage, including investment in construction to form fixed assets of an operating enterprise, foreign exchange differences arising from foreign-currency transactions of monetary items are recorded as financial income or financial expenses in the tax period;

+ For foreign-currency receivables, loans, cash, deposits, and cash in transit arising in the period, the foreign exchange difference deductible is the difference between the exchange rate at the time of the transaction and the exchange rate at the time of initial recognition.

• Donations, contributions to localities, contributions to unions and social organizations, and charity expenses, except for donations/sponsorships prescribed at point d clause 2 Article 9 of this Decree.
• Capital construction investment expenses in the investment stage to form fixed assets.

+ At the start of production and business, if the enterprise has not yet generated revenue but incurs regular expenses to maintain production and business activities (not capital construction expenses) and those expenses meet the prescribed conditions, such expenses are deductible when determining taxable income;

+ During the investment stage, if the enterprise incurs loan interest expense, such expense is capitalized into investment value. If, during the basic construction investment stage, the enterprise incurs both loan interest expense and interest income from deposits, they are offset against each other, and the net difference is recorded as a reduction of investment value.

• Expenses directly related to issuing shares (excluding shares classified as liabilities) and dividends on shares (excluding dividends on shares classified as liabilities), treasury share purchases, repurchases of the enterprise’s own shares, and other expenses directly related to increases or decreases in the enterprise’s equity.
• Expenses that do not meet conditions or content requirements under specialized laws, including:

+ Overtime expenses exceeding the time limits prescribed by labor law;

+ Advertising expenses for products/goods/services that are prohibited from advertising, or for products/goods/services that must be registered with competent authorities but the enterprise does not register the advertising as required by law;

+ Expenses for production/business that are not in accordance with or exceed limits under specialized laws.

• Expenses not corresponding to taxable revenue, except for expenses prescribed at point i clause 2 Article 9 of this Decree.
• Expenses that do not meet conditions or content requirements under specialized laws, including:

+ Overtime expenses exceeding the time limits prescribed by labor law;

+ Advertising expenses for products/goods/services that are prohibited from advertising, or for products/goods/services that must be registered with competent authorities but the enterprise does not register the advertising as required by law;

+ Expenses for production/business that are not in accordance with or exceed limits under specialized laws.

• Other non-deductible expenses are specified in Article 10 of this Decree.

5.  Tax Rates and Methods of Tax Calculation

5.1.  Standard Rates and Incentives for Small and Medium Enterprises

• Standard tax rate: 20%.
• Enterprises with total annual revenue not exceeding VND 3 billion: tax rate 15%.
• Enterprises with total annual revenue over VND 3 billion up to VND 50 billion: tax rate 17%.

Total revenue used to determine eligibility for the 15% and 17% rates is the total revenue from sales of goods and provision of services (excluding revenue deductions), financial revenue, and other income on the Appendix of Production and Business Results attached to the corporate income tax finalization return of the immediately preceding tax year.

+ If the enterprise’s operating period in the immediately preceding tax year is under 12 months, the total revenue of the preceding tax year is determined by taking the actual revenue in that tax period divided by the number of months the enterprise actually operated in that tax period and multiplied by 12 months.

If an enterprise is newly established, changes its enterprise type or ownership form, merges, consolidates, splits, or separates in any month of the immediately preceding tax year, the operating time is counted by full months;

+ If an enterprise is newly established in the current tax year and expects total revenue in the tax year not exceeding VND 3 billion or not exceeding VND 50 billion, it shall determine quarterly provisional tax payments at the corresponding rate of 15% or 17%.

At the end of the tax year, if actual total revenue meets the expected conditions above, the enterprise shall declare and finalize corporate income tax accordingly. If actual total revenue does not meet the conditions to apply the expected rate and this results in underpayment versus required provisional tax, the enterprise must pay the shortfall and late-payment interest in accordance with tax administration law;

+ The 15% and 17% tax rates do not apply to enterprises established under Vietnamese law that are subsidiaries or related parties where the related enterprise does not meet the conditions for applying the tax rates prescribed in Clause 2 and Clause 3 Article 11 of this Decree.

Legal basis: Article 11 of Decree 320/ND-CP

5.2. Direct Tax Calculation on Revenue

Applicable to entities that cannot determine expenses or income:

• Corporate income tax payable for foreign enterprises prescribed at points b2, b3, and b4 Clause 1 Article 2 of this Decree is calculated as a percentage (%) of taxable revenue arising in Vietnam, specifically as follows:

+ Services: 5%; for management services of restaurants, hotels, casinos: 10%. If services are bundled with goods, goods are taxed at 1%; if the value of goods and services cannot be separated: 2%;

+ Supply and distribution of goods in Vietnam via on-the-spot export/import or under international commercial terms (Incoterms): 1%; except cases where foreign enterprises sell raw materials, supplies, and components in bonded warehouses/free trade zones for import into Vietnam for export production/processing under contracts, or where foreign enterprises designate an export processing enterprise to deliver such materials to another export processing enterprise for export production/processing under contracts, which are not subject to corporate income tax;

+ Royalties: 10%;

+ Leasing of airplanes, helicopters, gliders (including engines and spare parts), and ships: 2%;

+ Leasing of drilling rigs, machinery, equipment, and vehicles (except as prescribed at point d of this clause): 5%;

+ Interest on loans: 5%;

+ Securities transfer; outward reinsurance: 0.1%;

+ Derivative financial services: 2%;

+ Capital transfer (except internal group ownership restructuring that does not change the ultimate parent company of the parties with direct/indirect ownership in the Vietnamese enterprise after restructuring and does not generate income): 2%;

+ Construction, transportation, and other activities: 2%.

• Enterprises with total annual revenue not exceeding VND 3 billion as prescribed in Article 11 of this Decree, where they cannot determine expenses or income of production/business activities, shall declare and pay corporate income tax at a percentage (%) of revenue from sales of goods and services, specifically as follows:

+ Distribution and supply of goods: 0.3%;

+ Manufacturing, transportation, services associated with goods, and construction with materials: 1.2%;

+ Services (including deposit interest and loan interest), and construction without materials: 1.5%. Specifically, asset leasing, insurance agency, lottery agency, and multi-level sales agency: 4%;

+ Provision of digital content products and services for entertainment, electronic games, digital films, digital images, digital music, and digital advertising: 4%;

+ Other activities: 0.5%.

• Cooperatives, cooperative unions established under the Law on Cooperatives, public service units, and other organizations prescribed at points c, d, and e Clause 1 Article 2 of this Decree that engage in production/business of goods and services with taxable income (excluding tax-exempt income under Article 4 of this Decree) and can account for revenue but cannot determine expenses/income of production/business activities shall declare and pay corporate income tax at a percentage (%) of revenue from sales of goods and services, specifically as follows:

+ For services (including deposit interest and loan interest): 5%. For services in education, healthcare, and performing arts: 2%;

+ For production and trading of goods: 1%;

+ For other activities: 2%.

Legal basis: Article 12 of Decree 320/ND-CP

6.  Income from Capital Transfers and Securities Transfers

6.1.  Income from Capital Transfers

• Income from capital transfers of an enterprise is income derived from transferring part or all of the enterprise’s capital invested in one or more organizations or individuals (including cases of selling the enterprise, transferring capital contribution rights, and other forms of capital transfer under law), transferring shares of non-public companies, and transferring shares of organizations that are not listed or registered for trading under securities law.

The time for determining income from capital transfer is the time of transfer of capital ownership.

+ If an enterprise sells the entire single-member limited liability company owned by an organization in the form of capital transfer involving real estate, it shall declare and pay corporate income tax as a real estate transfer activity;

+ If an enterprise transfers capital not in cash but in assets (including shares and fund certificates) or other in-kind benefits that generate income, such income is subject to corporate income tax. The value of assets, shares, fund certificates, and other in-kind benefits is determined based on the market selling price at the time the assets are received;

+ Income from capital transfers is classified as other income and included in taxable income when calculating corporate income tax.

• Determination of taxable income from capital transfers

Taxable income from capital transfers is determined as the transfer price minus the acquisition cost of the transferred capital portion and transfer expenses.

+ Transfer price is the total actual value received by the transferor under the transfer contract.

If the capital transfer contract stipulates installment or deferred payment, revenue from the contract does not include installment or deferred payment interest according to the contract term;

If the transfer contract does not specify the payment price or the tax authority has grounds to determine that the payment price is not consistent with market price, the tax authority has the right to inspect and assess the transfer price. If an enterprise transfers a portion of contributed capital at a price not consistent with market price, the tax authority may re-determine the total value of the enterprise at the time of transfer to re-determine the corresponding transfer price for the transferred capital portion;

For capital transfers to organizations or individuals, the transfer value under the contract of VND 5 million or more must have non-cash payment documents. If there are no non-cash payment documents, the tax authority has the right to assess the transfer price.

Transfer price assessment in this case is implemented in accordance with tax administration law;

+ The acquisition cost of the transferred capital portion is determined for each case as follows:

For capital contributions to establish an enterprise, the acquisition cost is the cumulative contributed capital value up to the time of transfer based on accounting books, records, and vouchers, and confirmed by the investing parties or by a business cooperation contract, or by the audit results of an independent audit firm for 100% foreign-owned enterprises;

For capital acquired through purchase, the acquisition cost is the capital value at the time of purchase, determined based on the capital purchase contract and payment documents;

If an enterprise is eligible to account in a foreign currency and transfers contributed capital in a foreign currency, the transfer price and acquisition cost are determined in that foreign currency; if an enterprise accounts in Vietnamese dong and transfers contributed capital in a foreign currency, the transfer price must be determined in Vietnamese dong in accordance with tax administration law;

+ Transfer expenses are actual expenses directly related to the transfer, with lawful vouchers and invoices. Transfer expenses include: costs for necessary legal procedures; fees and charges payable for transfer procedures; transaction, negotiation, and contract signing costs; and other costs with supporting documents.

If transfer expenses are incurred overseas, the original documents must be certified by a notary or independent audit in the country where the expenses arise, and the documents must be translated into Vietnamese (with confirmation by an authorized representative).

Legal basis: Article 13 of Decree 320/ND-CP

6.2.  Income from Securities Investment

• Income from securities transfers of an enterprise is income derived from transferring shares and rights to buy shares of public companies, listed organizations, and registered trading organizations; transferring bonds, treasury bills, fund certificates, and other securities under securities law.

+ If an enterprise issues additional shares to raise capital, the difference between the issuance price and par value is not included in taxable income for corporate income tax;

+ If an enterprise conducts a split, separation, consolidation, or merger and performs a share swap at the time of the split, separation, consolidation, or merger, any income arising is subject to corporate income tax;

+ If an enterprise transfers securities not in cash but in assets (including shares and fund certificates) or other in-kind benefits that generate income, such income is subject to corporate income tax. The value of assets, shares, fund certificates, and other in-kind benefits is determined based on the market selling price at the time the assets are received;

+ Income from securities transfers is classified as other income and included in taxable income when calculating corporate income tax.

• Determination of taxable income from securities transfers

Taxable income from securities transfers in the period is determined as the securities selling price minus the purchase price of the transferred securities and related transfer expenses.

+ The selling price of securities is determined as follows:

For listed securities and securities of public companies not listed but registered for trading on the Stock Exchange, the selling price is the actual selling price (matched price or negotiated price) as announced by the Stock Exchange;

For securities of companies not in the above cases, the selling price is the transfer price stated in the transfer contract;

+ The purchase price of securities is determined as follows:

For listed securities and securities of public companies not listed but registered for trading on the Stock Exchange, the purchase price is the actual purchase price (matched price or negotiated price) as announced by the Stock Exchange;

For securities purchased through auction, the purchase price is the price stated in the winning auction result notice of the auctioning organization and the payment receipt;

For securities not in the above cases, the purchase price is the transfer price stated in the transfer contract;

+ Transfer expenses are actual expenses directly related to the transfer, with lawful vouchers and invoices, including: costs for necessary legal procedures; fees and charges under law on fees and charges; transaction, negotiation, and contract signing costs; and other costs with supporting documents.

• Securities investment funds (excluding securities investment companies) are not subject to corporate income tax. The securities investment fund management company shall withhold corporate income tax payable by organizational investors (whether domestic or foreign) when the securities investment fund distributes dividends to investors at the tax rate of 20%.

Taxable dividends under this clause do not include dividends that are tax-exempt or that have already been subject to corporate income tax under law.

Legal basis: Article 14 of Decree 320/ND-CP

6.3.  Income from Real Estate Transfers

6.3.1 Income from Real Estate Transfer Activities Includes

• Income from transfer of land use rights, transfer of land lease rights (including transfer of projects associated with transfer of land use rights or land lease rights under law).
• Income from leasing or subleasing land use rights by real estate business enterprises under land law, regardless of whether there is infrastructure or architectural works attached to the land.

Income from leasing or subleasing land use rights under this clause does not include cases where an enterprise leases houses, infrastructure, or architectural works on land but does not have the right to lease or sublease land use rights under land law.

• Income from transfer of houses and construction works attached to land, including assets attached to such houses or construction works if their value is not separated upon transfer, regardless of whether there is a transfer of land use rights or land lease rights.
• Income from transfer of assets attached to land.
• Income from transfer of ownership of houses, infrastructure, and architectural works on land.
• Income from transfer or leasing of real estate of a real estate investment fund under law.

The securities investment fund management company shall declare and pay tax on income from transfer or leasing of real estate prescribed in this clause.

Legal basis: Article 15 of Decree 320/ND-CP

6.3.1 Tax Base

• The tax base for income from real estate transfer is taxable income and the tax rate.
• Taxable income is determined as taxable income from real estate transfer minus losses from real estate transfer carried forward (if any).
• Taxable income from real estate transfer is determined as revenue from real estate transfer minus deductible expenses from real estate transfer (including: cost of real estate and related deductible expenses) prescribed in Article 17 of this Decree.
• The corporate income tax rate for real estate transfer activities is 20%.
• Corporate income tax payable in a tax period for real estate transfer activities equals taxable income from real estate transfer multiplied by the 20% tax rate.
• For credit institutions and organizations wholly owned (100%) by the State and established by the Government with the function of purchasing, selling, and handling debts, that receive real estate and other assets as collateral to replace secured obligations, such institutions/organizations, when permitted to transfer real estate or other assets under law, must declare and pay tax from the transfer of real estate and other assets to the state budget. Where real estate or other collateral assets are auctioned, proceeds are settled under the law on secured transactions and tax is declared and paid accordingly. After these payments, the remaining proceeds are returned to the business organizations that pledged such real estate or other assets as collateral for loans.

Where a credit institution or a 100% state-owned organization established by the Government with the function of purchasing, selling, and handling debts is permitted to transfer mortgaged real estate or other assets to recover capital but cannot determine the cost of such real estate or assets, the cost is determined as the loan principal payable under the mortgage contract plus unpaid loan interest up to the time of foreclosure of the mortgaged real estate or assets, and transfer expenses (if any) supported by valid invoices/documents.

• Where an enforcement agency or authorized organization auctions real estate or other assets serving as collateral for enforcement, proceeds are handled under the law on distraint and auction for enforcement. The auction organization shall declare and withhold tax on transfers of real estate or other assets and pay it to the state budget. Documents must clearly state the tax declaration and payment for the sale of enforcement collateral assets.

Where an enforcement agency or authorized organization transfers real estate or other assets serving as collateral for enforcement but cannot determine the cost of such real estate or assets, the cost is determined as the debt payable under a court decision or competent authority decision for enforcement plus transfer expenses (if any) supported by valid invoices/documents.

Legal basis: Article 16 of Decree 320/ND-CP

7.  Corporate Income Tax Incentives under Decree 320

7.1. Principles and subjects eligible for tax incentives

• Enterprises are entitled to corporate income tax incentives based on incentivized sectors and geographic areas specified in this Article. The level of corporate income tax incentives shall be implemented in accordance with Article 19 and Article 20 of this Decree.
• Sectors eligible for corporate income tax incentives include the following:

+ High-tech application, venture capital investment for high-tech development in the list of high technologies prioritized for investment and development under the Law on High Technology; application of strategic technologies under laws on science, technology, and innovation; high-tech incubation, high-tech enterprise incubation; investment in construction and operation of high-tech incubation facilities and high-tech enterprise incubation facilities;

+ Software product manufacturing; manufacturing of network information security products and provision of network information security services meeting conditions under laws on network information security; manufacturing of key digital technology products, provision of digital technology services, and manufacturing of electronic equipment under laws on digital technology industry; research and development, design, manufacturing, packaging, and testing of semiconductor chip products; construction of artificial intelligence data centers under laws on digital technology industry;

+ Manufacturing supporting industrial products in the List of supporting industrial products prioritized for development as prescribed by the Government, meeting one of the following criteria:

Supporting industrial products for high technology under the Law on High Technology;

Supporting industrial products for manufacturing products in the textile-garment, leather-footwear, electronics-informatics (including semiconductor design and manufacturing), automobile assembly, and mechanical engineering industries up to the effective date of the Corporate Income Tax Law (October 1, 2025) that cannot yet be domestically produced or can be produced but must meet EU technical standards or equivalent (if any) as guided by the Minister of Industry and Trade;

+ Production of renewable energy, clean energy, and energy from waste destruction; environmental protection; production of composite materials, lightweight construction materials, and rare materials; defense and security production and manufacturing of industrial mobilization products under laws on defense and security industry and industrial mobilization; manufacturing of key chemical industrial products and key mechanical products under laws on chemicals and mechanics;

+ Investment in developing water plants, power plants, water supply and drainage systems, bridges, roads, railways, airports, seaports, river ports, airfields, stations, and other particularly important infrastructure works as decided by the Prime Minister;

+ High-tech enterprises, high-tech agricultural enterprises under the Law on High Technology; science and technology enterprises under the Law on Science, Technology, and Innovation;

+ Investment projects in manufacturing meeting the following conditions:

Having a minimum investment capital of VND 12,000 billion and disbursing the total registered investment capital within no more than 5 years from the date of investment approval under investment law;

Using technology meeting requirements prescribed by the Minister of Science and Technology;

+ Investment projects eligible for special investment incentives and support as prescribed in Clause 2, Article 20 of the Law on Investment.

The disbursement period for total investment capital of projects specified at this point shall not exceed 10 years from the date of issuance of the Investment Registration Certificate or investment approval under investment law;

+ Planting, caring for, and protecting forests; production, propagation, and crossbreeding of plant and animal varieties; investment in post-harvest preservation of agricultural products, preservation of agricultural products, aquatic products, and food; production, extraction, and refining of salt, except salt production specified in Clause 1, Article 4 of this Decree;

+ Cultivation of forest products;

+ Crop products, planted forests, livestock, aquaculture products, processing of agricultural products and aquatic products.

Income from processing agricultural and aquatic products specified at this point must meet the conditions prescribed at points b1 and b2, Clause 1, Article 4 of this Decree;

+ Production of high-grade steel; production of energy-saving products; production of machinery and equipment for agriculture, forestry, fishery, and salt production; production of irrigation equipment; production of livestock, poultry, and aquatic feed;

+ Manufacturing and assembly of automobiles; production of other digital technology products;

+ Investment in technical support facilities for small and medium enterprises, incubation facilities for small and medium enterprises; investment in co-working spaces supporting innovative startup small and medium enterprises under the Law on Support for Small and Medium Enterprises;

+ People’s credit funds, microfinance institutions, cooperative banks;

+ Cooperatives and cooperative unions operating in agriculture, forestry, fishery, and salt production;

+ Socialization in the fields of education and training, vocational training, healthcare, culture, sports, and environment according to the List of types, scale criteria, and standards prescribed by the Prime Minister; judicial assessment;

+ Investment in construction of social housing for sale, lease, or lease-purchase for subjects specified in the Law on Housing;

+ Publishing under the Law on Publishing;

+ Press (including advertising in newspapers) under the Law on the Press.

• Geographic areas eligible for corporate income tax incentives include:

+ Areas with extremely difficult socio-economic conditions under investment law, except areas with extremely difficult socio-economic conditions specified at No. 55, Appendix III, List of investment incentive areas issued together with Decree No. 31/2021/ND-CP dated March 26, 2021 of the Government (as amended and supplemented at Clause 37, Article 1 of Decree No. 239/2025/ND-CP dated September 3, 2025 of the Government);

+ Areas with difficult socio-economic conditions under investment law, except areas with difficult socio-economic conditions specified at No. 55, Appendix III, List of investment incentive areas issued together with Decree No. 31/2021/ND-CP dated March 26, 2021 of the Government (as amended and supplemented at Clause 37, Article 1 of Decree No. 239/2025/ND-CP dated September 3, 2025 of the Government);

+ Economic zones, high-tech zones, high-tech agricultural zones, concentrated digital technology zones.

Legal basis: Article 18 of Decree 320/ND-CP

7.2.  Preferential tax rates

• A 10% tax rate applies for 15 years to:

+ Enterprise income from new investment projects specified at points a, b, c, d, and dd, Clause 2, Article 18; enterprise income specified at point e, Clause 2, Article 18 of this Decree;

+ Enterprise income from investment projects specified at points g and h, Clause 2, Article 18 of this Decree;

+ Enterprise income from new investment projects in areas specified at point a, Clause 3, Article 18 of this Decree;

+ Enterprise income from new investment projects in high-tech zones, high-tech agricultural zones, concentrated digital technology zones; new investment projects in economic zones located in tax-incentive areas specified at points a and b, Clause 3, Article 18 of this Decree, including cases where the new investment project in the economic zone has more than 50% of its area located in tax-incentive areas specified at points a and b, Clause 3, Article 18 of this Decree.

• A 10% tax rate applies for the entire operating period to:

+ Enterprise income in tax-incentive areas specified at point b, Clause 3, Article 18 of this Decree from activities in sectors specified at points k and l, Clause 2, Article 18 of this Decree;

+ Enterprise income from activities in sectors specified at points i, r, and s, Clause 2, Article 18 of this Decree;

+ Income of publishing houses from activities in sectors specified at point t, Clause 2, Article 18 of this Decree;

+ Income of cooperatives and cooperative unions specified at point q, Clause 2, Article 18 of this Decree not located in areas specified at Clause 3, Article 18 of this Decree;

+ Income of press agencies in sectors specified at point u, Clause 2, Article 18 of this Decree.

• A 15% tax rate applies for the entire operating period to enterprise income not in areas specified at Clause 3, Article 18 of this Decree from activities in sectors specified at point l, Clause 2, Article 18 of this Decree.
• A 17% tax rate applies for 10 years to:

+ New investment projects in incentivized sectors specified at points m, n, and o, Clause 2, Article 18 of this Decree;

+ New investment projects implemented in areas specified at point b, Clause 3, Article 18 of this Decree;

+ New investment projects in economic zones not located in areas specified at points a and b, Clause 3, Article 18 of this Decree, including cases where the enterprise’s new investment project in the economic zone has more than 50% of its area in non-tax-incentive areas specified at points a and b, Clause 3, Article 18 of this Decree.

• A 17% tax rate applies for the entire operating period to enterprise income at point p, Clause 2, Article 18 of this Decree.
• Extension of the preferential tax rate period

+ The Prime Minister decides on extending the preferential tax rate period by a maximum of 15 additional years for cases specified at points b and c of this clause;

+ New investment projects specified at points a, b, d, and dd, Clause 2, Article 18 of this Decree, with a minimum investment capital of VND 6,000 billion, having significant socio-economic impact requiring special encouragement;

+ Investment projects specified at point g, Clause 2, Article 18 of this Decree meeting one of the following criteria:

Manufacturing products with global competitiveness, achieving revenue of over VND 20,000 billion per year within 5 years from having revenue from the investment project;

Regularly employing more than 6,000 workers as determined under labor law;

Investment projects in economic-technical infrastructure, including: investment in water plants, power plants, water supply and drainage systems, bridges, roads, railways, airports, seaports, river ports, airfields, stations, new energy, clean energy, energy-saving industry, and oil refining projects;

+ For new investment projects specified at point h, Clause 2, Article 18 of this Decree, the Prime Minister decides on applying a tax rate reduced by no more than 50% of the rate specified in Clause 1 of this Article; the preferential tax rate period shall not exceed 1.5 times the preferential tax rate period specified in Clause 1 of this Article and may be extended by no more than 15 additional years but not exceeding the investment project duration.

• The preferential tax rate period for income from new investment projects of enterprises specified in this Article (including projects at point g, Clause 2, Article 18 of this Decree) is calculated from the first year the enterprise’s new investment project has revenue.

Where an enterprise is issued a High-Tech Enterprise Certificate, High-Tech Agricultural Enterprise Certificate, Science and Technology Enterprise Certificate, High-Tech Application Project Certificate, or Supporting Industrial Product Manufacturing Project Incentive Confirmation after the date revenue arises, the preferential tax rate period is calculated from the year of issuance of the Certificate or Incentive Confirmation.

Legal basis: Article 19 of Decree 320/ND-CP

7.3.  Tax exemption and reduction

• Tax exemption for 4 years and 50% tax reduction for the following 9 years applies to:

+ Enterprise income specified in Clause 1, Article 19 of this Law;

+ Enterprise income specified at point r, Clause 2, Article 18 of this Decree in areas specified at points a and b, Clause 3, Article 18 of this Decree; where enterprise income specified at point r, Clause 2, Article 18 of this Decree is not in areas specified at points a and b, Clause 3, Article 18 of this Decree, it is exempt from tax for a maximum of 4 years and 50% tax reduction for a maximum of 5 subsequent years.

• Tax exemption for 2 years and 50% tax reduction for the following 4 years applies to enterprise income specified in Clause 4, Article 19 of this Decree.
• For new investment projects specified at point h, Clause 2, Article 18 of this Decree, the Prime Minister decides on extending the tax exemption and reduction period by a maximum of 1.5 times the period specified in Clause 1 of this Article and not exceeding the investment project duration.
• The tax exemption and reduction period is calculated from the first year with taxable income from the investment project. If there is no taxable income in the first 3 years from the first year with revenue from the project, the tax exemption and reduction period is calculated from the 4th year.

Where an enterprise is issued a High-Tech Application Project Certificate, High-Tech Enterprise Certificate, High-Tech Agricultural Enterprise Certificate, Science and Technology Enterprise Certificate, or Supporting Industrial Product Manufacturing Project Incentive Confirmation after the date income arises, the tax exemption and reduction period is calculated from the year of issuance of the Certificate or Incentive Confirmation. Where in the year of issuance there is no income yet, the tax exemption and reduction period is calculated from the first year with income; if in the first 3 years from the year of issuance the enterprise has no taxable income, the tax exemption and reduction period is calculated from the 4th year from the year of issuance of the Certificate or Incentive Confirmation.

• Tax incentives for expansion investment projects:

+ An enterprise with an operating investment project that expands scale, increases capacity, innovates technology, reduces pollution, or improves the environment in incentivized sectors or areas for corporate income tax specified in Article 18 of this Decree (hereinafter referred to as expansion investment) shall have the additional income from expansion investment entitled to tax incentives under the operating project for the remaining period and is not required to separately account for the additional income from expansion investment from income of the operating project;

+ Where the operating project has exhausted the tax incentive period, the additional income from the expansion investment project meeting the criteria specified in Clause 6 of this Article is eligible for tax exemption and reduction but not preferential tax rates. The tax exemption and reduction period for additional income from expansion investment equals the tax exemption and reduction period applicable to new investment projects in the same incentivized sectors and areas for corporate income tax and is calculated from the year the expansion investment project completes the registered investment capital.

The enterprise must separately account for the additional income from expansion investment to apply incentives. If separate accounting is not possible, income from expansion investment is determined based on the ratio of the original cost of newly invested fixed assets put into production and business use to the total original cost of the enterprise’s fixed assets;

Where in a tax period the enterprise cannot separately calculate the additional income from expansion investment, the additional income from expansion investment eligible for corporate income tax incentives is as follows:

Total original cost of the enterprise’s fixed assets includes: original cost of expansion investment fixed assets put into production/business use and original cost of existing fixed assets being used for production/business based on year-end figures on the Balance Sheet (Financial Position Report);

+ Tax incentives specified in this clause do not apply to cases of expansion investment through merger, acquisition of an enterprise, or acquisition of an operating investment project.

• Expansion investment projects eligible for incentives specified at point b, Clause 5 of this Article must meet one of the following criteria:

+ Additional original cost of fixed assets when the expansion investment project completes disbursement of registered capital of at least VND 40 billion for expansion investment projects in incentivized sectors under this Decree, or at least VND 20 billion for expansion investment projects in areas specified at points a and b, Clause 3, Article 18 of this Decree;

+ The proportion of additional original cost of fixed assets when the expansion investment project completes disbursement of registered capital is at least 20% compared to the total original cost of fixed assets before the expansion investment;

+ Additional design capacity when the expansion investment project completes disbursement of registered capital is at least 20% compared to the design capacity before the expansion investment.

The tax exemption and reduction period specified in this clause is calculated from the year the expansion investment project completes the registered investment capital and has income; if there is no taxable income in the first three years from the first year of completing the registered investment capital from the expansion investment project, the tax exemption and reduction period is calculated from the fourth year the expansion investment project completes the registered investment capital. The disbursed registered investment capital is determined as the difference between the total original cost of fixed assets on the Balance Sheet (Financial Position Report) of the enterprise at the time of completing the expansion investment project and before the expansion investment. During the period when the enterprise has not completed disbursement of registered investment capital, the enterprise is not eligible for tax incentives for the expansion investment project.

Legal basis: Article 20 of Decree 320/ND-CP

7.4.  Other cases of tax exemption and reduction

• Manufacturing, construction, and transportation enterprises (excluding public service units and offices under corporations and general companies that do not directly produce or do business) employing 10 to 100 female workers, where female workers account for more than 50% of the regular workforce, or regularly employing more than 100 female workers where female workers account for more than 30% of the regular workforce, are entitled to corporate income tax reduction equal to the additional expenses for female workers, including:

+ Retraining expenses;

+ Salary and allowances (if any) for teachers at daycare and kindergarten facilities organized and managed by the enterprise;

+ Additional health check expenses during the year;

+ Post-childbirth support for female workers at rates prescribed by competent authorities;

+ Salary and allowances paid for the period when female workers are entitled to post-childbirth leave or breastfeeding leave but continue to work.

Additional expenses for female workers eligible for corporate income tax reduction specified in this clause must meet the conditions on invoices and non-cash payment documents specified in Clause 1, Article 9 of this Decree.

• Enterprises employing ethnic minority workers are entitled to corporate income tax reduction equal to additional expenses for ethnic minority workers, including: vocational training expenses, housing support, social insurance, and health insurance for ethnic minorities where such support has not been provided by the State under applicable regimes.

Additional expenses for ethnic minority workers eligible for corporate income tax reduction specified in this clause must meet the conditions on invoices and non-cash payment documents specified in Clause 1, Article 9 of this Decree.

• Enterprises transferring technology in priority fields to organizations or individuals in areas with difficult socio-economic conditions, and public service units providing public services in areas with difficult socio-economic conditions, are entitled to a 50% reduction in corporate income tax on income from technology transfer and income from providing public services in areas with difficult socio-economic conditions.

Areas with difficult socio-economic conditions are as specified at point b, Clause 3, Article 18 of this Decree.

• Enterprises specified in Clauses 2 and 3, Article 11 of this Decree newly established from household businesses (including individual businesses converting to enterprises) are exempt from corporate income tax for 2 consecutive years from the first year with taxable income.

+ The tax exemption period specified in this clause is calculated continuously from the first year the enterprise has taxable income; if there is no taxable income in the first three years from the first year with revenue, the tax exemption period is calculated from the 4th year.

Where in the first tax period of the enterprise the tax-exempt production and business period is less than 12 months, the enterprise may choose to enjoy the tax exemption in that tax period or register with the tax authority to start the tax exemption from the following tax period. Where the enterprise registers the tax exemption period for the following tax period, it must determine the tax payable for the first tax period for payment to the state budget as prescribed;

+ After the tax exemption period specified in this clause, where the enterprise implements an investment project in incentivized sectors or areas specified in Article 18 of this Decree, it continues to enjoy corresponding incentives (preferential tax rates and tax exemption/reduction) under Articles 19 and 20 of this Decree.

Upon expiration of the tax exemption period and tax incentive period (if any) specified in this clause, the enterprise applies the corporate income tax rate specified in Clauses 2 and 3, Article 11 of this Decree;

+ Household businesses and individual businesses specified in this clause must meet the condition of having registered and operated under law and having continuous production and business for at least 12 months up to the date of first issuance of the Enterprise Registration Certificate;

+ Newly established enterprises entitled to tax exemption and incentives under this clause are enterprises registering business for the first time, excluding cases where the newly established enterprise’s legal representative (except where the legal representative is not a capital-contributing member), general partner, or largest capital contributor has participated in business as a legal representative, general partner, or largest capital contributor in enterprises that are operating or have been dissolved for less than 12 months from the time of dissolution of the old enterprise to the establishment of the new enterprise.

• Public science and technology organizations and public higher education institutions operating on a non-profit basis are exempt from tax as follows:

+ Public science and technology organizations under laws on science, technology, and innovation operating on a non-profit basis are exempt from tax on income from scientific research, technology development, and income from providing science, technology, and innovation services;

+ Public higher education institutions under the Law on Higher Education operating on a non-profit basis are exempt from tax on revenue specified in Article 64 of the Law on Higher Education 2012 (as amended and supplemented at Clause 32, Article 1 of the Law Amending and Supplementing Certain Articles of the Law on Higher Education 2018).

Legal basis: Article 21 of Decree 320/ND-CP

7.5.  Conditions for applying corporate income tax incentives

Conditions for applying corporate income tax incentives are implemented under Article 18 of the Corporate Income Tax Law.

• During the period of enjoying corporate income tax incentives, if the enterprise conducts multiple production and business activities, the enterprise must separately account for income from production and business activities eligible for tax incentives under Articles 4, 19, 20, and 21 of this Decree from income from production and business activities not eligible for tax incentives.

+ Where in a tax period the enterprise does not separately account for income from production and business activities eligible for tax incentives and income from production and business activities not eligible for tax incentives, the income from tax-incentivized production and business activities is determined as: total taxable income multiplied by the percentage (%) of revenue or deductible expenses from tax-incentivized production and business activities to total revenue or total deductible expenses of the enterprise in the tax period;

+ Where revenue or deductible expenses cannot be separately accounted for, such revenue or deductible expenses are determined based on the ratio of revenue or deductible expenses from tax-incentivized production and business activities to total revenue or deductible expenses of the enterprise.

• At the same time, if an enterprise is entitled to different levels of tax incentives for the same income, the enterprise may choose to apply the most favorable tax incentive level:

+ Where an enterprise is during the period of enjoying corporate income tax incentives and chooses to switch to tax incentives under another criterion with more favorable incentives, the previously enjoyed incentive period (years of tax exemption, tax reduction, and preferential tax rates applied) must be deducted;

+ Where an enterprise has exhausted corporate income tax incentives under corporate income tax regulations and is issued a High-Tech Enterprise Certificate, High-Tech Agricultural Enterprise Certificate, Science and Technology Enterprise Certificate, High-Tech Application Project Certificate, or Supporting Industrial Product Manufacturing Project Incentive Confirmation, it is entitled to incentives for the remaining period. The remaining incentive period is determined as the incentive level applicable to high-tech enterprises, high-tech agricultural enterprises, science and technology enterprises, high-tech application projects, supporting industrial product manufacturing projects minus the previously enjoyed incentive period under corporate income tax law (years of tax exemption, tax reduction, and preferential tax rates applied);

+ Where an enterprise has income in agriculture, forestry, fishery, or salt production that also meets conditions under other incentivized sectors or areas and the enterprise chooses incentives under other sectors or areas, upon expiration of the incentive period under other sectors or areas (including tax exemption, tax reduction, and preferential tax rates), it may switch to the preferential tax rate or tax exemption applicable to agriculture, forestry, fishery, and salt production under this Decree;

+ Where an enterprise has chosen incentives under points a, b, and c, Clause 2, Article 23 of this Decree 320, it applies the chosen incentive level for the entire remaining incentive period; after the choice is made, the enterprise may not switch to incentives under other criteria.

• Application of corporate income tax incentives based on geographic area criteria:

+ An enterprise with a manufacturing investment project enjoying tax incentives based on geographic area criteria that generates income from supplying products and goods produced by the project outside the project location is also entitled to tax incentives for such income;

+ Investment projects in commerce and services in corporate income tax incentive areas (including economic zones, high-tech zones, high-tech agricultural zones, concentrated digital technology zones) are only entitled to incentives for project income arising in the project location.

An enterprise with an investment project in transportation business entitled to corporate income tax incentives due to meeting geographic area conditions is entitled to corporate income tax incentives for income from transportation services based on the project location in the tax-incentive area and having a departure or destination point in the project location.

• An enterprise with an investment project is entitled to corporate income tax incentives under corporate income tax law at the time of licensing or issuance of the Investment Registration Certificate or investment approval under investment law. Where corporate income tax law changes and the enterprise meets incentive conditions under the newly amended law, the enterprise may choose to enjoy preferential tax rates and tax exemption/reduction periods under the law at the time of licensing, Investment Registration Certificate issuance, investment approval, or under the newly amended law for the remaining period from the 2025 tax year.

Where an enterprise has an investment project not eligible for incentives under corporate income tax regulations before the effective date of this Decree but is eligible for incentives under this Decree, it may apply incentives under this Decree for the remaining period from the 2025 tax year.

• Tax-exempt and incentivized income in agriculture, forestry, fishery, and salt production under this Decree includes income from liquidating assets that are agricultural, forestry, fishery, or salt products, and income from selling scrap and by-products that are agricultural, forestry, fishery, or salt products.
• Where an enterprise’s new investment project in the first year generating revenue and income eligible for tax incentives has a period of less than 12 months, the enterprise may choose to enjoy tax incentives (tax rates, tax exemption and reduction periods) for the investment project from the tax period when revenue and income arise, or register with the tax authority to start enjoying tax incentives from the following tax period. Where the enterprise registers the tax incentive period for the new investment project for the following tax period, it must determine the tax payable from this investment project for the first year with revenue and income for payment to the state budget as prescribed.

+ Where a high-tech enterprise, high-tech agricultural enterprise, or science and technology enterprise in the first tax period with revenue or in the first tax period with income has revenue or income eligible for tax incentives for less than 12 months, the enterprise may choose to enjoy tax incentives (tax rates, tax exemption and reduction periods) from that first tax period, or register with the tax authority to start enjoying tax incentives from the following tax period. Where the enterprise registers the tax incentive period for the following tax period, it must determine the tax payable for the first tax period for payment to the state budget as prescribed.

+ Where an enterprise changes the corporate income tax period (including changing from a calendar year to a fiscal year or vice versa), the corporate income tax period of the conversion year shall not exceed 12 months. An enterprise during the period of enjoying corporate income tax incentives that converts the tax period may choose to: enjoy incentives in the tax period conversion year, or pay tax at the non-preferential rate for the conversion year and enjoy tax incentives in the following year.

• An enterprise established or an enterprise with an investment project from merger, consolidation, division, separation, change of ownership, or conversion of enterprise type is responsible for fulfilling corporate income tax obligations (including fines if any) and is entitled to inherit corporate income tax incentives (including losses not yet carried forward) of the enterprise or investment project before the conversion, division, separation, merger, or consolidation if it continues to meet corporate income tax incentive conditions and loss carryforward conditions as prescribed.
• Corporate income tax incentives for new investment projects:

+ New investment projects eligible for corporate income tax incentives under Articles 19 and 20 of this Decree must be issued an Investment Registration Certificate by competent State agencies or have investment policy approval under investment law or investment permission under specialized laws.

For investment projects not required to obtain an Investment Registration Certificate, investment policy approval under investment law, or investment permission under specialized laws, the determination of a new investment project is based on the Enterprise’s Investment Project Implementation Report under investment law submitted to the investment registration agency;

+ New investment projects eligible for corporate income tax incentives as new investments do not include the following cases:

Investment projects formed from: merger, consolidation, division, separation, conversion of enterprise type under law.

Investment projects formed from change of ownership (including cases of implementing a new investment project but inheriting assets, business location, and business lines of the old enterprise to continue production and business; purchasing an operating investment project);

+ For enterprises enjoying corporate income tax incentives as newly established enterprises from investment projects, the tax incentives only apply to income from production and business activities meeting investment incentive conditions stated in the Enterprise Registration Certificate or the first Investment Certificate of the enterprise. For enterprises in operation with changes to the Enterprise Registration Certificate or Investment Certificate that do not affect meeting the tax incentive conditions of that project, the enterprise continues to enjoy tax incentives for the remaining period or expansion investment incentives if meeting incentive conditions as prescribed;

+ For investment projects issued an Investment Registration Certificate or permitted to invest under investment law where the initial investment registration dossier submitted to the investment licensing agency has registered investment capital, investment phases with implementation schedules, where subsequent phases are actually implemented and are considered component projects of the initially licensed investment project if implemented on schedule (except for force majeure, difficulties due to objective reasons in site clearance, administrative procedures of State agencies, natural disasters, fires, or other force majeure difficulties), the component projects of the initial investment project are entitled to tax incentives for the remaining period of the initial investment project calculated from the time the component project has income eligible for incentives.

During the implementation of component projects by phases as above, if the investor is permitted by the State investment management agency to extend the project under investment law and the enterprise implements within the extended deadline, it is also entitled to tax incentives as prescribed above.

• The 15% and 17% tax rates specified in Clauses 2 and 3, Article 11 and tax incentives under Articles 4, 19, 20, and 21 of this Decree do not apply to:

+ Income from capital transfer, transfer of capital contribution rights; income from real estate transfer, except income from social housing construction investment specified at point s, Clause 2, Article 18 of this Decree; income from transfer of investment projects (except mineral processing project transfers), transfer of rights to participate in investment projects, transfer of rights to explore, exploit, and process minerals; income from production and business activities outside Vietnam;

+ Income from exploration, prospecting, and exploitation of oil and gas and other rare resources, and income from mineral exploration and exploitation;

+ Income from production and business of online electronic games; income from production and business of goods and services subject to special consumption tax under the Law on Special Consumption Tax, except automobile, aircraft, helicopter, glider, yacht manufacturing and assembly projects, and oil refining projects;

+ Other income specified in Clause 3, Article 3 of this Decree not related to tax-incentivized production and business activities.

This provision applies to cases of implementing investment projects meeting sector incentive conditions specified in Clause 2 and geographic area incentive conditions specified in Clause 3, Article 18 of this Decree;

+ Other cases as guided by the Minister of Finance.

• During the period of enjoying corporate income tax incentives, if in a tax period the enterprise does not meet one of the tax incentive conditions specified in Clauses 1, 3, 4, 5, 6, 8, 12, and 14, Article 4, Clauses 2 and 3, Article 11, Articles 18, 19, 20, 21, and this Article, that tax period is not eligible for tax incentives and must pay tax at the 20% rate (for cases enjoying incentives under sector and area conditions specified in Articles 18, 19, and 20 of this Decree, that year is also counted toward the registered incentive period).

For investment projects specified at points g and h, Clause 1, Article 18, points c and d, Clause 6, Article 19 of this Decree, where after 3 years (5 years for projects at point g) from the date of investment licensing (excluding delays due to objective reasons in site clearance, State administrative procedures, natural disasters, enemy sabotage, fires, or other force majeure difficulties approved by the Investment Certificate-issuing agency and reported to the Prime Minister for approval) or the 4th year from the year with revenue (6th year for projects at point g) and the enterprise’s investment project does not meet the conditions at points g and h, Clause 1, Article 18, points c and d, Clause 6, Article 19 of this Decree, it is not entitled to corporate income tax incentives, and the enterprise must declare and pay the corporate income tax declared as enjoying incentives in previous years (if any) under law and shall not be considered as making incorrect declarations under tax administration law. During the period of enjoying corporate income tax incentives, if in any tax year the enterprise does not meet one of the tax incentive conditions specified at points g and h, Clause 1, Article 18 of this Decree, that year the enterprise is not entitled to corporate income tax incentives.

• High-tech enterprises, high-tech agricultural enterprises, and science and technology enterprises are entitled to corporate income tax incentives for income from high-tech activities, high-tech application, scientific research and technology development results, and income directly related to high-tech activities, high-tech application, and scientific research and technology development results.

Legal basis: Article 23 of Decree 320/ND-CP

8.  Rules on Loss Determination and Loss Carryforward

• Loss incurred in a tax period is the negative difference in taxable income not including losses carried forward from previous years.
• After tax finalization, if an enterprise incurs a loss, it shall carry forward the entire loss continuously to taxable income in subsequent years. The loss carryforward period is calculated continuously for no more than 5 years from the year following the year in which the loss was incurred.
• Enterprises temporarily carry forward losses to quarterly income when determining provisional quarterly tax and officially carry forward when filing the annual tax finalization return. Loss carryforward in specific cases is as follows:

+ An enterprise with losses between quarters in the same year may offset the loss of the previous quarter against subsequent quarters of that year. When finalizing corporate income tax, the enterprise determines the annual loss and carries forward the entire loss continuously to taxable income in subsequent years as prescribed above;

+ The enterprise self-determines the loss to be deducted from taxable income under this Decree. Where additional losses are incurred during the loss carryforward period, such additional losses (excluding losses carried forward from previous periods) shall be carried forward entirely and continuously for no more than 5 years from the year following the year in which such loss was incurred.

Where the competent inspection or audit authority determines the loss eligible for carryforward differently from the enterprise’s self-determination, the loss eligible for carryforward is determined according to the inspection or audit conclusion but must ensure entire and continuous carryforward for no more than 5 years from the year following the year of loss as prescribed;

After 5 years from the year following the year of loss, if the loss has not been fully carried forward, it shall not be carried forward to income of subsequent years.

• An enterprise with losses from the transfer of mineral exploration or exploitation projects; transfer of rights to participate in mineral exploration, exploitation, or processing projects; or transfer of mineral exploration, exploitation, or processing rights may carry forward such losses to taxable income of that activity in subsequent years. The loss carryforward period is calculated continuously for no more than 5 years from the year following the year in which the loss was incurred.
• An enterprise undergoing enterprise type conversion, ownership change, merger, consolidation, division, or separation that has losses after completing tax finalization as prescribed must track such losses in detail by the year of occurrence and offset them against the income of the same year of the enterprise after conversion, merger, or consolidation, or continue to carry forward such losses to subsequent years of the enterprise after conversion, merger, or consolidation, to ensure the principle that loss carryforward is calculated continuously for no more than 5 years from the year following the year of loss and as prescribed in Clause 4, Article 25 of this Decree.

Losses of the enterprise incurred before division or separation into other enterprises that are still within the loss carryforward period as prescribed shall be allocated to the enterprises after division or separation in proportion to the equity capital being divided or separated.

Legal basis: Article 7 of Decree 320/ND-CP

9.  Transitional Provisions

• An enterprise with a new investment project before the effective date of the Corporate Income Tax Law that is still within the corporate income tax incentive period, including cases where the new investment project has not yet enjoyed incentives under corporate income tax regulations before the effective date of this Decree, shall be entitled to incentives for the remaining period under regulations in effect at the time of issuance of the Investment Registration Certificate or investment policy approval under investment law or investment permission under specialized laws; where the incentive level under this Decree is higher than the current incentive level, the enterprise may switch to incentives under this Decree for the remaining period. The remaining period specified at this point is calculated from the 2025 tax period.
• An enterprise with an expansion investment project that was issued or adjusted an Investment Registration Certificate or investment policy approval or the Enterprise’s Investment Project Implementation Report under investment law submitted to the investment registration agency or investment permission under specialized laws (hereinafter referred to as investment permission) before the effective date of the Corporate Income Tax Law that is still within the corporate income tax incentive period, including cases where the expansion investment project was issued or adjusted an Investment Registration Certificate or investment permission but has not yet enjoyed incentives under corporate income tax regulations before the effective date of this Decree, shall be entitled to incentives for the remaining period under regulations in effect at the time of issuance or adjustment of the Investment Registration Certificate or investment permission; where the incentive level under this Decree is higher than the current incentive level (including cases eligible but not yet enjoying incentives), the enterprise may switch to incentives under this Decree for the remaining period. The remaining period specified at this point is calculated from the 2025 tax period.

Where an enterprise has an expansion investment project that was issued or adjusted an Investment Registration Certificate or investment policy approval or investment permission before the effective date of the Corporate Income Tax Law, the determination of incentives and the timing for calculating tax incentives for expansion investment shall be implemented under regulations in effect at the time of issuance or adjustment of the Investment Registration Certificate or investment policy approval or investment permission.

• An enterprise with income from activities eligible for incentives under corporate income tax regulations before the effective date of the Corporate Income Tax Law (excluding investment projects specified in Clauses 1 and 2 of this Article) where such income is not eligible for tax incentives under the Corporate Income Tax Law shall not enjoy tax incentives from the effective date of the Corporate Income Tax Law.
• An enterprise with losses incurred before the effective date of this Decree (including losses from real estate transfer, investment project transfer, and transfer of rights to participate in investment projects) that are still within the loss carryforward period as prescribed may continue to carry forward such losses under this Decree for the remaining period. Losses from real estate transfer, investment project transfer, and transfer of rights to participate in investment projects from previous periods shall not be carried forward against profits from production and business activities eligible for tax incentives.

Legal basis: Article 25 of Decree 320/ND-CP

10.  Effective Date

• This Decree takes effect from the date of signing and applies from the 2025 corporate income tax period. The determination of the applicable time in specific cases is as follows:

– Enterprises may choose to apply the provisions on revenue, expenses, tax incentives, tax exemption, tax reduction, and loss carryforward under this Decree from the beginning of the 2025 tax period or from the effective date of the Corporate Income Tax Law or from the effective date of this Decree; where the enterprise’s 2025 tax period begins after the effective date of the Corporate Income Tax Law, the application shall be from the effective date of the Corporate Income Tax Law or from the effective date of this Decree;

– Provisions on non-cash payment documents at point c, Clause 1, Article 9 and provisions on capital transfer at point i, Clause 3, Article 12 of this Decree shall apply from the effective date of this Decree.

• This Decree replaces:

– Decree No. 218/2013/ND-CP dated December 26, 2013 of the Government providing detailed regulations and guidance on implementation of certain articles of the Corporate Income Tax Law;

– Decree No. 91/2014/ND-CP dated October 1, 2014 of the Government amending and supplementing certain articles of tax-related Decrees;

– Decree No. 12/2015/ND-CP dated February 12, 2015 of the Government providing detailed implementation of the Law Amending and Supplementing Certain Articles of Tax Laws and amending and supplementing certain articles of tax-related Decrees;

– Decree No. 57/2021/ND-CP dated June 4, 2021 of the Government adding point g, Clause 2, Article 20 of Decree No. 218/2013/ND-CP on corporate income tax incentives for supporting industrial product manufacturing projects.

• Where legal documents referenced in this Decree are amended, supplemented, or replaced, the amended, supplemented, or replaced documents shall apply.

Legal basis: Article 24 of Decree 320/ND-CP

11.  Significance of Decree 320 for Enterprises

Decree 320/2025/ND-CP serves as an important legal basis for:

• Enterprises to review all currently applied CIT policies;
• Assessing tax risks during inspection and audit periods;
• Providing explanations and working with tax authorities;
• Serving as a basis in tax disputes, complaints, and administrative litigation.

12.  Conclusion

With the issuance of Decree 320/2025/ND-CP, the Corporate Income Tax legal framework has been standardized in the direction of:

• Transparency;
• Consistency;
• Alignment with the economic substance of transactions.

Enterprises need to thoroughly study and correctly apply the provisions of Decree 320 to ensure compliance with tax law and minimize risks during tax inspection and audit processes.