Chapter IV
INCOME FROM CAPITAL AND SECURITIES TRANSFER
Article 14. Income from capital transfer
1. Scope of application:
Income from capital transfer of an enterprise is the income from the transfer of part or all of the capital that the enterprise has invested in one or multiple organizations and individuals (including selling the entire enterprise). The time of capital transfer is the time of transferring the capital ownership.
The enterprise transferring capital and receiving assets or other financial interests (shares, fund certificates…) in stead of cash, and earning income, is subject to enterprise income tax. The value of assets, shares, fund certificates… is calculated based on their market prices at the receiving time.
2. Basis for tax calculation:
a) The chargeable income from capital transfer is calculated as follows:
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Chargeable income
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=
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Transfer price
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-
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Purchase price of the capital transferred
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-
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Transfer cost
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Including:
- The transfer price is the total actual value collected by the transferring party under the transfer contract.
In case the capital transfer contract requires payment in installments or deferred payment, the revenue of the transfer contract shall not include the installment interest or deferred payment interest according to the contractual period.
If the transfer contract does not specify the transfer price, or the tax authorities have grounds to conclude that the price is not conformable with the market price, the tax authorities are entitled to inspect and fix the transfer price. When an enterprises transfers part of the contributed capital of which the transfer price is not conformable with the market price, tax authorities are entitled to set the entire value of the enterprise at the transferring time to recalculate the transfer price proportionally to the contributed capital transferred.
The transfer price is fix based on the investigation documents of tax authorities, or on the capital transfer prices in other cases at the same time, of the same economic organization, or on the similar transfer contracts at the transferring time. If the transfer price fixed by the tax authorities is not conformable, is shall be calculated based on the valuation of competent professional valuation organizations at the transferring time as prescribed.
- The purchase price of the capital transferred is calculated in each particular case as follows:
+ If the contributed capital is transferred to establish new enterprises, the purchase price is the value of the contributed capital based on the accounting documents at the transferring time, and certified by the contributing parties or cooperation parties, or based on the audit results from an independent audit company regarding 100%-capitalized enterprises.
+ If the capital is repurchased, the purchase price is the capital value at the purchasing time. The purchase price is calculated based on the contributed capital purchase contract and the payment receipts.
For enterprises practicing accounting in foreign currency (approved by the Ministry of Finance) that transfer the contributed capital in foreign currency, the transfer price and the purchase price of the capital transferred is calculated in foreign currency; for enterprises practicing accounting in VND that transfer the contributed capital in foreign currency, the transfer price must be calculated in VND according to the average exchange rates of the inter-bank foreign currency market announced by the State bank of Vietnam at the transferring time.
- The transfer cost is the actual expenses on the transfer with valid receipts and invoices. The original receipts of transfer cost arising abroad must be certified by an independent audit company or notarization agency in the country in which the cost arises. The receipts must be translated into Vietnamese (certified by competent representatives).
The transfer cost includes: the expense on the legal procedures necessary for the transfer, the fees and charges payable when implementing the transfer procedures; the expenses on the transaction, negotiation and conclusion of the transfer contract, and other expenses proved in writing.
Example 12. Enterprise A contributes 400 billion VND, including 320 billion VND of the workshop value, and 80 billion VND in cash to establish a joint venture enterprise that produces toilet-paper. Then enterprise A transfers such contributed capital to enterprise B for 550 billion VND. The contributed capital of enterprise A at the transferring time in the accounting book is 400 billion, the expenses on the capital transfer is 70 billion VND. The chargeable income from the capital transfer in this case is 80 billion VND (550 - 400 - 70).
b) The income from capital transfer is consider other income and shall be included in the taxable income when calculating enterprise income tax.
c) The tax applicable to foreign organizations doing business in Vietnam, or earning income in Vietnam, not operating under the Law on investment, the Law on Enterprise (hereinafter referred to as foreign contractors) that transfer capital, shall be declared and paid as follows:
The organizations and individuals receiving the capital transfer are responsible for calculating, declaring, deducting and pay the enterprise income tax amount payable on behalf of the foreign organizations. If the capital transfer receiver is also a foreign organization not operating under the Law on investment, the Law on Enterprise, the enterprise established under the Vietnam’s law invested by such foreign organizations are responsible for declaring and paying the enterprise income tax amount payable on their behalf.
The tax declaration and payment are done as prescribed in the legal documents on tax administration.
Article 15. Income from securities transfer
1. Scope of application:
Income from securities transfer of enterprises is the income from the transfer of shares, bonds, fund certificates and other kinds of securities as prescribed.
In case a joint-stock company issues more shares to mobilize capital, the difference between the issue price and the face value is not subject to enterprise income tax.
If a joint-stock company earns income by swapping their shares while dividing, separating, merging and consolidating, such income is subject to enterprise income tax.
The enterprise transferring securities and receiving assets or other financial interests (shares, fund certificates…) in stead of cash, and earning income, is subject to enterprise income tax. The value of assets, shares, fund certificates… is calculated based on their sale prices at the receiving time.
2. Basis for tax calculation:
Chargeable income from securities transfer in the period is equals (=) the securities sale price minus (-) the purchase price of the securities transferred, minus (-) the expenses on the transfer.
- The securities sale price is calculated as follows:
+ For listed securities and unlisted securities of public companies registered for trading at Securities trading centers, the securities sale price is the actual securities sale price (order matching price of agreed price) according to the announcement of the Stock Exchange or Securities trading center.
+ For securities of the companies outside the cases above, the securities sale price is the transfer price in the transfer contract.
- The securities purchase price is calculated as follows:
+ For listed securities and unlisted securities of public companies registered for trading at Securities trading centers, the securities purchase price is the actual securities purchase price (order matching price of agreed price) according to the announcement of the Stock Exchange or Securities trading center.
+ For securities purchased from auctions, the securities purchase price is the price on the announcement of the auction winner made by the organization holding the share auction, and on the payment bill.
+ For securities outside the cases above, the securities purchase price is the transfer price in the transfer contract.
- The transfer cost is the actual expenses on the transfer with valid receipts and invoices.
The transfer cost includes: the expense on the legal procedures necessary for the transfer, the fees and charges payable when implementing the transfer procedures; the expenses on securities depository as prescribed by the State Securities Commission and the receipts of the securities company; the expenses on the securities entrusting based on the receipts of the entrusted unit. the expenses on transaction, negotiation and conclusion of the transfer contract, and other expenses proved in writing.
The income from securities transfer is considered other income and shall be included in the taxable income when calculating enterprise income tax.
Tìm kiếm
Thông tư 123/2012/TT-BTC (Bản Word)