In this article
When a foreign investor sells its capital contribution in a Vietnamese company, the accountant's first questions are usually: who must file the tax, where, and on what amount? Tax on capital transfers by foreign investors is closely tied to the change-of-members file, the DICA and a cost basis recorded years earlier. ACCA Consulting Vietnam walks through a hypothetical case so you can see each step.
1. Who files tax on a foreign investor's capital transfer?
A foreign corporate seller usually has no tax code and no operations in Vietnam. Current regulations therefore assign responsibility for filing and paying on its behalf to a party in Vietnam, most commonly the Vietnamese company in which the foreign investor holds capital (the company whose capital is transferred), or the buyer if it is a Vietnamese organization, depending on the case. Before signing the contract, the parties should clearly agree who will file and record this in the contract.
| Seller | Buyer | Points to check |
|---|---|---|
| Foreign organization | Vietnamese organization/individual | Filing party, filing deadline, payment documents |
| Foreign organization | Another foreign organization | The Vietnamese company usually has to file on the seller's behalf even though it receives no money |
| Foreign individual | Any | Personal income tax (PIT/TNCN) on capital transfers under the current tariff |
| Foreign organization with a permanent establishment | Any | May be accounted for as income of the permanent establishment |
Because the Vietnamese company may have to file for a transaction in which it receives no money directly, the accountant should ask the seller early for the contract, cost basis documents and payment documents.
2. Worked example: calculating the gain on transfer
Illustrative example: Parent company A (foreign) contributed VND 8 billion to Company X in Ho Chi Minh City, holding 40%. This year A sells its entire stake to Company B for VND 12 billion (approximately USD 470,600 at a reference rate of VND 25,500/USD). Directly related advisory and legal costs are VND 300 million.
Illustrative example in VND million. Gain = transfer price − cost basis − transfer costs. The method for calculating tax on capital transfers by foreign corporate investors must be checked against the 2025 Law on Corporate Income Tax and current guidance.
View as table
| Transfer price | 12,000 million VND |
| Cost basis of the capital contribution | 8,000 million VND |
| Transfer costs | 300 million VND |
| Indicative gain | 3,700 million VND |
The method for determining the tax payable when a foreign organization transfers capital (whether on the gain or on the transfer proceeds, and the applicable rate) has been revised under the 2025 Law on Corporate Income Tax (CIT/TNDN) and its implementing guidance. This article therefore does not give an indicative tax figure; before signing the contract, both parties should ask an adviser to calculate it under the rules in force at the time of transfer.
The cost basis is a frequent point of dispute
- The cost basis must be documented: DICA statements for the capital transfer, the capital contribution certificate, and any earlier contract for purchasing the stake.
- Capital contributed in foreign currency: agree how it is converted into VND in accordance with the regulations, rather than using an arbitrary exchange rate.
- Transfer costs must be directly related and supported by valid invoices and documents.
3. Order of procedures when a foreign investor transfers capital
- 1Check conditions
Check whether a foreign buyer needs to complete the procedure for registering a capital contribution or share purchase.
- 2Sign the contract
State the price, currency, payment deadline and the party responsible for filing the tax.
- 3Payment
Pay through the appropriate account; transactions involving foreign investors usually go through the DICA.
- 4File and pay tax
The party responsible for filing on the seller's behalf submits the return and pays the tax by the statutory deadline.
- 5Update the licences
Amend the Enterprise Registration Certificate (ERC) and adjust the Investment Registration Certificate (IRC) if the investor changes.
- 6Update the records
Company X updates its register of members and the details of capital contributed by each owner.
In many cases the registration authority requires or refers to the completion of tax obligations when processing a change of members. See amending the IRC to learn when both certificates must be amended.
4. Common risks and how to avoid them
- Is the transfer price too low compared with book value or market value?
- Are the buyer and seller related parties?
- Does the contract clearly state the filing party and the obligation to provide documents?
- Does a double taxation agreement apply, and what documents are needed?
- Does the payment schedule match the filing deadline, to avoid late-payment interest of 0.03% per day?
FAQ
Does the Vietnamese company have to file on the seller's behalf if it receives no money?
It may. Where both parties are overseas, the regulations usually assign the filing to the Vietnamese company whose capital is transferred. Check in advance and ask the parties to provide the documents.
Do we need to file if the transfer is at a loss?
It is still advisable to file so there is a record showing that no tax arises, especially when the licences need to be updated. A low transfer price must also be explainable.
Can a tax treaty be used to obtain an exemption?
Some treaties contain provisions on income from the alienation of property. Applying them requires a notification file as prescribed and a case-by-case review of each treaty.
Run a tax estimate before signing the transfer contract
ACCA Consulting Vietnam provides accounting services in Ho Chi Minh City for FDI companies, helping prepare cost basis documents and the filing calendar. Get advice.
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