Pursuant to Circular No. 219/2013/TT-BTC dated December 31, 2013 of the Ministry of Finance guiding on value added tax;
Pursuant to Circular No. 103/2014/TT-BTC dated August 6, 2014 of the Ministry of Finance guiding the implementation of tax obligations applicable to foreign organizations and individuals doing business in Vietnam or earning income in Vietnam (referred to as contractor tax):
+ Clause 2.a, Article 12 stipulates: the rate (%) of VAT calculated on taxable revenue for income from services is 5%.
+ Clause 2.a Article 13 stipulates: the rate (%) of CIT calculated on taxable revenue for income from services is 5%, the rate (%) of CIT calculated on taxable revenue for royalties is 10%.
Pursuant to the above provisions, in case the Company signs a contract with a foreign organization for the foreign organization to provide the service of transmission charges, fees for using the Email system and fees for using the corporate governance system (calculated on the number of users), etc., when paying money to the foreign organization, the Company is responsible for calculating, withholding, declaring and paying contractor tax, specifically as follows:
* For the fee for using the corporate governance system (ERP, BPC…), the fee for using corporation’s Email (EMAIL & EPORTAL):
– VAT: Not subject to VAT;
– CIT = Revenue subject to CIT x 10 %.
* For transmission charges (IPVPN) and line support charges (WANSUPP):
– VAT = Revenue subject to VAT x 5 %;
– CIT = Revenue subject to CIT x 5 %.