Latest CIT rate in 2022

1. What is corporate income tax?

⛳ Corporate income tax is a direct tax, levied directly on the taxable income of an enterprise, including: Income from production and trading activities of goods or services, and other incomes as prescribed under the law.

⛳ The CIT rate is understood as the tax payable per unit of goods or taxable income. Tax rate (%) is calculated on a unit of goods, taxable income, or is fixed by the state for each specific type of goods or service.

️⛳ Formula for calculating CIT:

CIT payable = Taxable income x CIT rate

Taxable incomes = Income taxes - Tax-free income + Carry forward losses

2. The objects that must pay CIT:

Pursuant to Circular No. 78/2014/TT-BTC, guiding the implementation of Decree 218/2013/ND-CP dated December 26, 2013, of the Government, subjects to pay corporate income tax include:

✔ Enterprises established in accordance with the provisions of Vietnamese law,

✔ Foreign enterprises, that have a permanent establishment (or not) in Vietnam,

✔ Organizations established under the Law on Cooperatives;

✔ Non-business units established in accordance with Vietnamese law;

✔ Other organizations are doing business and have income.

3. CIT rates:

⏭️ Pursuant to Article 10 of the Law on CIT, the CIT rate of 20% is applicable to enterprises not eligible for tax incentives, mining a number of precious and rare minerals.

⏭️ Pursuant to Clause 3, Article 11 of Circular No. 78/2014, the CIT rate of 32% - 50% applies to:

✔ Oil and gas prospection, exploration, and production activities in Vietnam.

✔ Based on the exploitation location, mining conditions, and my reserves, enterprises having investment projects in oil and gas prospection, exploitation shall determine the specific tax rates for each project and each facility. business.

⏭️ The CIT rate of 50% applies to activities of prospecting, exploration, and exploitation of mines of precious and rare natural resources (including: platinum, gold, silver, tin, wonfram, antimony, precious stones, rare earth excluding petroleum).

⏭️ The CIT rate of 40% applies to rare and precious resource mines with 70% of the allocated area or more located in areas with extremely difficult socio-economic conditions on the list of priority areas. corporate income tax incentives.

4. CIT rate incentives:

  Pursuant to Article 19 of Circular No. 78/2014/TT-BTC as amended and supplemented by Article 11 of Circular 96/2015/TT-BTC, the preferential tax rates are prescribed as follows:

💢 The preferential tax rate is 10% for 10 years

✔ Income of enterprises from implementing new investment projects in areas with extremely difficult socio-economic conditions.

✔ Income of enterprises from implementing new investment projects in the following fields:

▪️ Scientific research and technology development.

▪️ High-tech applications on the list of high technologies are prioritized for development investment in accordance with the Law on High Technology.

▪️  High-tech incubation, high-tech enterprise incubation.

▪️ Venture investment for a high-tech development is on the list of high-tech prioritized for development in accordance with the law on high technology…

✔ Income of enterprises from implementing new investment projects in the field of environmental protection.

✔ High-tech enterprises, high-tech agricultural enterprises…

💢 Preferential tax rate of 10% during the operation period

✔ The enterprise's income is from socialization activities in the fields of education - training, vocational training, healthcare, culture, sport and environment, judicial assessment.

✔ The income portion of the Publisher's publishing activities.

✔ Income from printing press activities.

✔ The enterprise's income from the implementation of investment projects - social housing business for sale, lease, or lease-purchase.

✔ Income of enterprises from planting, tending, and protecting forests; income from cultivation, animal husbandry, farming, and processing of agricultural and aquatic products in difficult socio-economic areas...

✔ The income of cooperatives operating in the fields of agriculture, forestry, fishery, and salt production are not located in difficult socio-economic areas and in extremely difficult socio-economic areas.

💢 Preferential tax rate 17% for 10 years

✔ Income of enterprises from implementing new investment projects in areas with difficult socio-economic conditions.

✔ Income of enterprises from implementing new investment projects: production of high-grade steel; produce energy-saving products; manufacturing machinery and equipment for agricultural, forestry, fishery, and salt production; produce irrigation equipment…

💢 Preferential tax rate of 17% during the operation period:

✔ Applicable to People's Credit Funds, Cooperative Banks, and Microfinance Institutions.

💢 15% preferential tax rate

✔ Tax rate of 15% on incomes of enterprises from cultivation, husbandry, and processing in the field of agriculture and fisheries in areas not in areas with difficult socio-economic conditions or areas with favorable conditions especially difficult socio-economic difficulties.

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