A business bank account is extremely important and necessary. Because, all transactions related to electronic tax payment, purchase and sale of goods/services with invoices over VND 20,000,000, or cross-border transactions must be paid through the company’s bank account. So how to open a business bank account for an FDI company? The following article of LTS LAW will update details about the process as well as the procedure for opening a business account for an FDI company.
Why is it necessary to open a business bank account for a foreign-invested company?
Why is it necessary to open a business bank account for a foreign-invested company?
Upon company registration, a foreign-invested company has a lot of post-licensing procedures that need to be done. In which, opening a business account is a necessary thing for an FDI company. An FDI company needs to open a business bank account in order to make the following transactions:
- Fulfilling financial or tax obligations towards the State.
- Receiving capital contribution from foreign investors and local investors.
- Receiving payments or making payments to clients/ partners or suppliers.
- Proving the validity of invoices for purchase of goods and services with a payment value of over VND 20 million.
- Making cross-border transactions.
- Being more convenient in all transactions with clients, contributing to saving time.
- Showing professionalism in the operation of FDI companies.
What types of business bank accounts are required for foreign-invested companies?
What types of business bank accounts are required for foreign-invested companies?
In order to make investments in Vietnam, foreign-invested companies are allowed to open the following types of accounts to make revenue and expenditure transactions:
Direct investment capital account
Under Clause 1, Article 5 of Circular 06/2019/TT-NHNN guiding foreign exchange management for foreign direct investment activities in Vietnam, the users of the direct investment capital account include FDI enterprises.
Enterprises must open a direct investment capital account in foreign currencies at an authorized bank to make lawful revenue and expenditure transactions in foreign currencies related to foreign direct investment activities in Vietnam.
Corresponding to the type of foreign currency in which investment capital is contributed, an enterprise may only open one direct investment capital account in such foreign currency at an authorized bank.
In the case of investing in Vietnam dong, the enterprise may open a direct investment capital account in Vietnam dong at an authorized bank where the foreign currency direct investment capital account has been opened to make lawful revenue and expenditure transactions in foreign currencies related to foreign direct investment activities in Vietnam.
Payment account
Under Clause 6, Article 1 of Circular 02/2019/TT-NHNN, the objects allowed to open a payment account in Vietnam dong or foreign currencies include “Organizations established and operating legally under the provisions of Vietnamese law, including legal entities, private enterprises, business households, and other organizations are allowed to open payment accounts at banks, foreign bank branches in accordance with the provisions of law”.
The legal representative or authorized representative (collectively referred to as the legal representative) of the organization opening payment accounts on behalf of such organization to perform transactions related to the payment account within the scope of representatives, such as using payment accounts to deposit and withdraw cash and request payment service providers to provide payment services via the account, namely providing payment means, making check payment services, payment orders, collection of payment, collection orders, bank cards, letters of credit, money transfer, collection-on-behalf-of, payment-on-behalf-of, and other value-added services in accordance with applicable laws.
Instructions on how to open a business bank account for a FDI company
Instructions on how to open a business bank account for a FDI company
Each bank shall have its own requirements for bank account registration procedures for FDI enterprises. Normally, the process of opening a business account for an FDI company is basically as follows:
The process of opening a business account for an FDI enterprise
Step 1: Select a bank to open an account.
Step 2: Prepare all documents for opening a business account, including:
- An application form for opening an account according to the bank’s form (can be downloaded from the bank’s website or collected directly at the bank’s branch or transaction office);
- Decide on appointment of chief accountant or person in charge of accounting.
- Certified copy of Enterprise Registration Certificate;
- Certified copy of Investment Registration Certificate;
- A valid copy of the company’s Charter;
- A valid copy of the parent company profile if the shareholder is an organization.
- 1 certified copy of a valid ID card/passport of a legal representative/account holder and chief accountant/person in charge of accounting.
- 1 certified copy of the person authorized to transact at the bank (if any).
Step 3: After preparing all necessary documents, an account opening representative shall sign and stamp the company to send to the bank. Most banks in Vietnam require an account opening representative to be present in Vietnam to open a business bank account.
Step 4: The bank shall conduct the appraisal of the application and open a bank account.
Procedures for notifying the enterprise’s bank account to the tax authority
According to the previous regulations, within 10 days of opening a business account, enterprises are required to carry out the procedures for notifying the business bank account to the Department of Planning and Investment to control transactions.
However, according to regulations, from 01 May 2021, the company is not required to carry out the procedure for notifying the bank account with the Department of Planning and Investment. Instead, the company shall notify the local tax authority of the company’s account number information under the form 08-MST issued together with Circular 105/2022/TT-BTC dated 03 December 2020 of the Ministry of Finance.
| Form No.: 08-MST (Issued together with Circular 105/2020/TT-BTC dated 03 December 2020 of the Ministry of Finance) |
SOCIALIST REPUBLIC OF VIETNAM
Independence – Freedom – Happiness
—————
DECLARATION
ADJUSTMENTS AND ADDITIONS OF TAX REGISTRATION INFORMATION
| □ Enterprises, cooperatives | □ Organizations | □ Business households, business individuals | □ Individuals | □ Others |
- Taxpayer’s name:
- Tax code:
- Head office address:
- Tax agent information (if any):
4a. Name:
4b. Tax code:
4c. Tax agency contract: No. date
Additional registration, change of tax registration criteria is as follows:
| Indicators (1) | Old registration information (2) | New registration information (3) |
| I- Adjustment of registered information: |
| |
| II- Addition of information: Notice of bank account | STK: 12345XXXXX at Bank XXXX |
The taxpayer hereby undertakes that the above declared information is completely accurate and is responsible before the law for the declared information.
| TAX AGENT STAFF Full name: ……. Practicing certificate No: …….. | …, day: …./…../…………… TAXPAYER or LEGAL REPRESENTATIVE OF TAXPAYER Sign, full name and stamp (if any) ) |
Consulting services for setting up an FDI company, and opening a business bank account without the presence of a Director in Vietnam of LTS LAW
Consulting services for setting up an FDI company, and opening a business bank account without the presence of a Director in Vietnam of LTS LAW
LTS LAW is currently one of the units specializing in providing consulting services to establish foreign-invested enterprises in Ho Chi Minh City in particular and Vietnam in general. With long-term experience in the market along with a team of experienced lawyers, LTS LAW has successfully supported many domestic and foreign businesses in all matters of legal advice and companies/enterprises establishment, accounting services, and taxes, … especially LTS LAW can support foreign-invested companies to open a business bank account in Vietnam without the presence of director/legal representative in Vietnam.
When choosing to use LTS LAW’s services, all legal difficulties related to enterprises shall be solved quickly, minimizing risks, and enterprises can be completely assured to focus and develop business activities. LTS LAW’s consulting service on FDI company establishment as well as bank account opening is the solution for all companies/ enterprises today, especially FDI enterprises that do not have much experience in opening a company in Vietnam.
The above is information related to the procedure of opening a business account for a foreign-invested company in Vietnam. If you are facing difficulties or need more advice on consulting services on business establishment procedures and how to open a business bank account for FDI companies, etc., please contact LTS LAW immediately for support from the most professional team of lawyers!
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