Updates on Vietnamese tax policies for businesses

Startups are an inevitable trend in the world, especially in the context of innovation and sustainable development being increasingly emphasized. Therefore, in Vietnam and many countries around the world, governments have issued many practical programs to support startups. In this article, S4B Vietnam will review some Updates on Vietnamese tax policies for businesses from the government such as taxes, cash subsidies, … or indirectly through infrastructure investment, providing funding to operate startup incubators.

1. Preferential tax policies

Depending on the time, Vietnam’s tax laws & regulations will offer incentives with different goals such as attracting foreign capital, promoting the development of priority areas, creating job opportunities, increasing domestic products, promoting exports, or developing science and technology, etc. Some typical policies include:

1.1 Incentives on corporate income tax rates

Currently, corporate income tax is a direct tax on the finances of startups, so the State’s support is mainly this tax. Pursuant to Clause 1, Article 13 of the Law on Corporate Income Tax 2008 (amended and supplemented in 2013 and 2014), start-up enterprises can apply a preferential tax rate of 10% for a period of 15 years, typically in the following fields:

  • Scientific research and technology development
  • Application of high technology, construction and business of incubators, venture investment for development in the priority list as prescribed by the Law on High Technology;
  • Production of software products.

Updates on Vietnamese tax policies for businesses

1.2 Incentives on exemption and reduction of corporate income tax

In addition, if income is classified in the above fields, innovative start-up enterprises can be exempted from tax for 4 years and have 50% of the tax payable reduced in the next 9 years according to Clause 1, Article 14 of the Law on Corporate Income Tax 2008 (amended and supplemented in 2013 and 2014).

In addition, in Clause 3, Article 18 of the Law on Support for Small and Medium Enterprises 2017, innovative startup investors are exempted from and have their income tax reduced for a limited period from investments in startups as prescribed. However, the law has not yet specified this, so the actual benefits are still limited.

With the tax incentive policy for innovative startups, although in the short term it will reduce budget revenue, in the long term it will help startups improve their accumulation and competitiveness, thereby promoting economic development and creating other “spillover effects” for the economy.

2. Cash subsidies and related costs

The Vietnamese Government has recently issued Decree No. 80/2021/ND-CP, according to Article 22 of the Decree, small and medium-sized enterprises and creative startups in industry-specific accounting regulations in Vietnam (e.g., manufacturing, F&B, startups) will be supported with many costs and fees, such as:

  • Support 100% of the cost of using equipment at technical facilities, incubators, and co-working areas, but not exceeding 20 million VND/year/enterprise
  • Support up to 50% of the cost of renting premises at incubators and co-working areas, but not exceeding 5 million VND/month/enterprise. The maximum support period is 3 years from the date the enterprise signs the premises lease contract. Support 100% of the value of consulting contracts for management and development of products and services protected by intellectual property rights domestically, but not exceeding 50 million VND/contract/year/enterprise
  • Support up to 50% of the value of consulting contracts for establishing, transferring, exploiting and protecting intellectual property rights abroad, but not exceeding 50 million VND/contract/year/enterprise. Support up to 50% of the cost of testing new products at units and organizations testing goods products but not exceeding 30 million VND/year/enterprise
  • Support up to 50% of the value of consulting contracts to complete new products, new services, new business models, new technologies but not exceeding 50 million VND/contract/year/enterprise” – the Decree clearly states.
  • In addition, support up to 50% of the cost of participating in domestic specialized training courses for enterprise students on product development and construction; product commercialization… but not exceeding 5 million VND/student/year and not exceeding 3 students/enterprise/year…

Industry-specific accounting regulations in Vietnam (e.g., manufacturing, F&B, startups)

3. Financial support fund

In Vietnam, a typical example is the Youth Startup Support Fund managed by the Ho Chi Minh City Youth Union and operated by the Youth Startup Support Center. The main purpose is to encourage entrepreneurship among young people, with a total capital of 100 billion VND.

Above article is the common tax and accounting penalties in Vietnam. We hope we have bring readers with good information and helpful advice. Understanding these Updates on Vietnamese tax policies for businesses is crucial for businesses and individuals operating in Vietnam to stay compliant with local regulations and avoid unnecessary financial risks. If you have any questions or require assistance with Vietnam’s tax laws & regulations matters, feel free to reach out to our team.

>>>Read more: Accounting services in Vietnam 2025

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