How to remit profits from Vietnam? It is a big concern for foreign investors who have establish a foreign invested enterprise in Vietnam. A brief introduction to the profits remittance in Vietnam is presented below for your reference.
When can profits be remitted out?
The foreign shareholders of a foreign invested enterprise are permitted to remit out their distributed profits after the end of each financial year or upon termination of their investment in Vietnam. If the foreign invested enterprise has accumulated losses, it is not allowed to distribute profits and remit out the profits or dividends to the foreign shareholders.
Are there any taxes imposed on profits remittance?
According to the relevant laws and regulations of Vietnam, no tax is imposed on profits or dividends remitted overseas to corporate shareholders. However, profits or dividends remitted overseas to individual shareholders are subject to a 5% withholding tax unless the rate is reduced under an applicable tax treaty.
Are there any limitson the frequency of profits remittance?
According to the relevant laws and regulations of Vietnam, the profits of a foreign invested enterprise may only be remitted out once per year.
What are the requirements for profits remittance??
Prior to remitting profits or dividends to its foreign shareholders, a foreign invested enterprise in Vietnam shall meet the following conditions:
complete and settle all tax obligations within 90 days after the end of the financial year;
complete and submit the audited financial statements within 90 days after the end of the financial year;
notify the tax bureau of the profits remittance plan at least 7 working days in advance;
transfer funds to foreign currency account and apply for remittance.
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Disclaimer
All information in this article is only for the purpose of information sharing, instead of professional suggestion. Kaizen will not assume any responsibility for loss or damage.
Foreign invested enterprises (FIEs) registered in Vietnam are required to submit reports on investment activities to the relevant investment registration authorities on periodic basis in accordance with the Law on Investment of Vietnam and other laws and regulations.
A foreign invested company shall be dissolved under the following circumstances:The operation period specified in the company's charter expires without a decision on extension;The dissolution is decided by the shareholders of the company;The company fails to maintain statutory minimum number of members for six consecutive months without conversion;
A Foreigner has to apply for and obtain a valid work permit in order to work legally in the territory of Vietnam, except for the specific circumstances of work permit exemption as indicated by law. The foreigner is required to apply for a work visa or a temporary residence card to reside in Vietnam legally after obtaining a work permit. Foreigners with a temporary residence card can enter and exit Vietnam without a visa within the valid terms of their temporary residence card.
Foreign investors may enter the Vietnam market through an equity acquisition of an existing Vietnamese enterprise (hereinafter referred to as “foreign equity acquisition”) in addition to setting up a foreign invested enterprise in Vietnam directly. Currently, Vietnam has not yet enacted any special laws or regulations on foreign equity acquisition.
