In the draft decree detailing a number of articles of the Law on Corporate Income Tax that is being consulted, the Ministry of Finance proposes regulations on corporate income tax exemption for enterprises converted from business households and individuals.
This Ministry stated that the Law on Corporate Income Tax stipulates that newly established enterprises from business households will be exempted from corporate income tax for two consecutive years from the time taxable income arises.
To implement the above regulations, the Ministry proposes to apply a policy of corporate income tax exemption for the first 2 years for newly established enterprises from business households, including individual businesses converting to enterprises, on condition that they meet the contents specified in Clause 2 and Clause 3, Article 10 of the guiding Decree.
The corporate income tax exemption period is calculated continuously from the first year the enterprise generates taxable income. In case there is no taxable income in the first 3 years, from the first year of revenue, the tax exemption period is calculated from the 4th year.
If in the first tax period, the period of tax-exempt production and business activities is less than 12 months, the enterprise can choose to apply tax exemption immediately in that tax period or register with the tax authority to transfer the tax exemption starting time to the next tax period.
In case an enterprise chooses the tax exemption period from the next tax period, it must still determine and pay the tax payable in the first tax period in accordance with regulations.
After the tax exemption period as prescribed above, if an enterprise implements an investment project in a tax-incentive industry, trade or location, it will continue to enjoy corresponding preferential policies such as preferential tax rates or tax exemption or reduction as prescribed by law.
At the end of the tax exemption and tax incentives period, if any, the enterprise will apply the corporate income tax rate according to current general regulations.
The Ministry of Finance proposes regulations on tax exemption for enterprises converted from households and individual businesses (Photo: Manh Quan).
The Ministry of Finance noted that to be exempted from corporate income tax, business households or individual businesses must ensure that they have registered and operated in accordance with legal regulations, and have had a minimum of 12 months of continuous production and business operations up to the time of being granted the first business registration certificate.
Newly established enterprises enjoying tax exemption and tax incentives must be enterprises registering for the first time.
This policy does not apply to newly established enterprises where the legal representative, unless he/she is not a capital contributor, general partner, or the person with the highest capital contribution ratio, has participated in business activities in similar roles at another enterprise that is in operation or has been dissolved within 12 months from the date of establishment of the new enterprise.
Source: https://dantri.com.vn/kinh-doanh/ho-kinh-doanh-chuyen-len-doanh-nghiep-co-the-duoc-mien-thue-2-nam-20250715161938624.htm
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