Tiếng Việt
On June 29, 2025, the National Assembly passed Law No. 67/2025/QH15, amending and supplementing several provisions of the Law on Corporate Income Tax, which will officially come into force on October 1, 2025.
This amendment not only enhances tax transparency but also tightens the criteria for deductible expenses, broadens the scope of taxable income, and raises requirements for supporting documentation. Now is the critical time for businesses to comprehensively review their practices to avoid back taxes and penalties.
1. Elimination of Ineligible Expenses: Clear Boundaries, Stricter Penalties
According to Clause 2, Article 9 of Law No. 67/2025/QH15, from October 1, 2025, expenses are only deductible if they meet all three conditions:
– Directly serve business operations;
– Are supported by lawful invoices and documents;
– Are settled in compliance with payment regulations.
Non-deductible expenses include:
– Costs unrelated to business operations;
– Expenses lacking valid documentation or incorrect payment methods;
– Administrative fines;
– Costs already covered by other funding sources;
– Sponsorships not compliant with regulations or lacking proper acknowledgment;
– Capital contributions, investments, or dividend payments that do not generate taxable income;
– Expenses exceeding industry-specific limits or violating other laws.
The new law removes all “gray areas” in cost accounting – only legitimate, well-documented, and reasonable expenses will be deductible.
2. Expanded Taxable Income: Every Revenue Stream Must Be Reported
Clause 1, Article 4 of the amended law expands taxable income to include:
– Income from regular business operations;
– Profits from capital transfers, real estate, and asset rights;
– Interest income, dividends, exchange rate differences, and financial investments;
– Income from transferring or leasing intangible assets;
– Irregular income such as asset liquidation, recovered debts, donations, gifts, etc.
Businesses are required to declare all income accurately and provide supporting documents. Failure to do so means no tax exemptions.
3. New Corporate Income Tax Calculation Methods from October 1, 2025
According to Article 11, there are now two methods of calculating CIT:
(1) Taxable Income Method (common method):
Applicable to businesses that can determine revenue, expenses, and taxable income.
Formula:
CIT payable = Taxable income × Tax rate
(2) Revenue-Based Method (special cases):
Applicable as per government regulations to:
– Foreign businesses without a permanent establishment in Vietnam but generating income here (Clause 2, Article 2, Points c and d);
– Microenterprises with annual revenue under VND 3 billion but unable to determine expenses or taxable income (Clause 2, Article 10);
– Cooperatives, public service units, or similar organizations with business income but insufficient data to calculate costs or profits (Clause 1, Article 2, Points c, d, and đ).
4. Key Legal Provisions to Follow Starting Q4/2025
Businesses must carefully review these core legal documents:
– Law No. 67/2025/QH15 – Amending the CIT Law;
– Clause 1, Article 4: Taxable income;
– Clause 2, Article 9: Non-deductible expenses;
– Articles 18 & 19: Tax calculation and incentives (unchanged).
These provisions directly apply from Q4/2025 and will form the basis for tax audits and enforcement in the 2026 financial year.
5. LTS LAW as Your Tax Compliance Partner
With years of experience in corporate tax consulting, LTS LAW provides comprehensive solutions, including:
– Reviewing all cost structures and payment records;
– Guiding the preparation of valid documentation and proper income classification;
– Assisting in adjusting accounting, financing, marketing, and investment processes;
– Representing businesses during tax inspections or audits.
We specialize in supporting businesses in e-commerce, finance, real estate, education, healthcare, and large-scale manufacturing – sectors prone to complex tax documentation issues.
6. Take Action Now to Avoid Penalties and Loss of Tax Incentives
Don’t wait until year-end to review your expenses. Every mistake today could mean lost tax incentives or penalties tomorrow.
Free Consultation Hotline: 0902 798 066
Visit us at: https://lts.com.vn
