According to the Circular No. 66/2010 / TT-BTC, from 2016 onwards; Based on current regulations in Decree No. 20/2017 / ND-CP dated April 22, 2010 and February 24, 2017, from 2017 onwards
Pursuant to the provisions of the Circular No. 66/2010 / TT-BTC, applied from 2016 onwards; Based on the current regulations in Decree No. 20/2017 / ND-CP dated April 22, 2017 and February 24, 2017, applying from 2017 onwards, guiding the determination of market prices in delivery business translation between parties with affiliated relations, all production and business organizations (business and production) of goods and services (DN) performing business transactions with "parties with related relationships" ( Associated transactions are obliged to declare and determine the corporate income tax obligations in Vietnam. Associated transactions include transactions of buying, selling, exchanging, renting, leasing, transferring, or transferring goods and services in the course of business between "affiliated parties".
Typically, two businesses in a tax period with a business transaction in one of the following cases are identified as affiliated parties:
a) One enterprise directly or indirectly holds at least 20% of investment capital of the owner of the other enterprise- applied for year 2016 and from year 2017 is 25%;
b) From 2016 onwards, an enterprise provides directly or indirectly more than 50% of the total value of input materials, supplies or products (excluding depreciation expenses for fixed assets). ) to use for production and business of output products of another enterprise; From 2017 onwards, according to Decree 20, this requirement has been removed, but authorities have added definition: (1) One or more businesses are under the control of an individual through this individual's contributed capital entering that enterprise or directly participating in running a business; and (2) An actual business is governed by and controlled by other businesses. Although it is not clear whether these additional requirements may be considered to be the same or replace the above requirements, we should pay attention and wait for more detailed instructions.
c) From 2016 onwards, an enterprise directly or indirectly controls over 50% of the consumption of products (calculated by each type of product) of another enterprise. From 2017 onwards, according to Decree 20, this requirement has been removed, but authorities have added definition: (1) One or more businesses are under the control of an individual through this individual's contributed capital. entering that enterprise or directly participating in running a business; and (2) An actual business is governed by and controlled by other businesses. Although it is not yet clear whether these additions will be considered to be the same or replace the requirement, we should pay attention and wait for more detailed instructions;
d) From 2016 onwards, two businesses have business cooperation agreements on a contract basis. From 2017 onwards, according to Decree 20, this requirement has been removed, but authorities have added definition: (1) One or more businesses are under the control of an individual through this individual's contributed capital. entering that enterprise or directly participating in running a business; and (2) An actual business is governed by and controlled by other businesses. Although it is not yet clear whether these additions will be considered or replaced, we should pay attention and wait for more detailed instructions;
e) Enterprises determined to have associated transactions must make reports according to the form set by the Ministry of Finance and send them to functional agencies according to regulations. In case, the company does not declare or declare but does not declare it in accordance with regulations and does not have explanatory documents to protect its report is correct and at market prices, then the tax authority have the right to determine the price used to declare and calculate tax, to determine taxable income or payable enterprise income tax for enterprises with associated transactions. In addition, enterprises may be sanctioned for violations of tax and tax evasion procedures and tax fraud according to the Law on Tax Administration.