The following information provides an important update on business license fee rates as stipulated in Decree No. 22/2020/NĐ-CP dated February 24, 2020, which amends and supplements certain provisions of Decree No. 139/2016/NĐ-CP dated October 4, 2016.
1. Business License Fee Rates for Organizations Engaged in Production and Business Activities
According to Article 4, the applicable business license fee rates are as follows:
- Organizations with charter capital or investment capital exceeding VND 10 billion: VND 3,000,000/year.
- Organizations with charter capital or investment capital of VND 10 billion or less: VND 2,000,000/year.
- Branches, representative offices, business locations, public service units, and other economic organizations: VND 1,000,000/year.
The applicable fee is determined based on:
- The charter capital recorded in the Enterprise Registration Certificate.
- The investment capital recorded in the Investment Registration Certificate, in cases where there is no charter capital.
2. Business License Fee Rates for Individuals and Household Businesses
The applicable fee is determined based on annual revenue:
- Revenue exceeding VND 500 million/year: VND 1,000,000/year.
- Revenue from over VND 300 million to VND 500 million/year: VND 500,000/year.
- Revenue from over VND 100 million to VND 300 million/year: VND 300,000/year.
The revenue used to determine the applicable fee is based on guidelines issued by the Ministry of Finance.
3. Regulations on Exemptions and Reductions of Business License Fees
- Small and medium-sized enterprises (SMEs) converted from household businesses, including their branches, representative offices, and business locations:
- After the business license fee exemption period expires (starting from the fourth year of operation):
- If the business starts operations in the first half of the year: Full annual fee applies.
- If the business starts operations in the second half of the year: 50% of the annual fee applies.
- After the business license fee exemption period expires (starting from the fourth year of operation):
- Households, individuals, and groups of individuals that have ceased operations and later resumed business:
- If resuming business in the first half of the year: Full annual fee applies.
- If resuming business in the second half of the year: 50% of the annual fee applies.
- Organizations and individuals that fail to declare their business license fees:
- Must pay the full annual fee, regardless of when the omission is discovered.
4. Regulations on Changes in Charter Capital or Investment Capital
- If an organization changes its charter capital or investment capital, the applicable business license fee is based on the capital amount recorded in the previous year.
- If the charter capital or investment capital is denominated in a foreign currency, it must be converted into Vietnamese Dong (VND) based on the buying exchange rate of the commercial bank or financial institution where the taxpayer maintains their account.
5. Regulations on Temporary Suspension of Business Activities
- A taxpayer that submits a written notification of temporary business suspension to the tax authorities before the deadline (January 30 each year) and has not yet paid the business license fee is exempt from the fee for the suspension year.
- If these conditions are not met, the taxpayer is required to pay the full annual business license fee.
6. Conclusion
The updated Business License Fee regulations in Vietnam outline specific rates based on charter or investment capital, annual revenue, and business type. We assist business owners, especially those involved in FDI activities, in ensuring compliance with these regulations to avoid legal risks and optimize business operations.
At PLF Law Firm
We assist clients in understanding these exemptions, to ensure compliance with tax regulations. This is one of our responsibilities in Corporate and Tax Advisory services, to help you effectively manage taxes. From tax planning at every stage to identifying tax risks to optimizing ROI through personalized tax solutions, our lawyers help your business save more costs in the short, mid, and long-term.
If you need further assistance with the procedures for business license fee exemptions, don’t hesitate to contact PLF Law Firm today via email at inquiry@plf.vn or +84913 902 906 or Zalo | Viber | WhatsApp to receive a free 30-Initial Minute Consultation.
Article completion date: January 27th, 2025.
Ms. Le Vo
