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What is the profit transferred abroad?
Pursuant to Article 2 of Circular 186/2010/TT-BTC, profits transferred abroad include:
– Profits of foreign investors transferred from Vietnam to abroad are lawful profits shared or obtained from direct investment activities in Vietnam under the Law on Investment, after fully fulfilling financial obligations to the Vietnamese State as prescribed.
– Profits transferred from Vietnam to abroad can be in cash or in kind.
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Time to transfer profits abroad
According to Article 4 of Circular 186/2010/TT-BTC, the time of transferring profits abroad is as follows:
– Transfer profits abroad annually.
The foreign investor shall be entitled to annually transfer the book of profits shared or earned from direct investment activities in Vietnam abroad at the end of the fiscal year, after the enterprise in which the foreign investor participates in investment has fulfilled its financial obligations to the State of Vietnam in accordance with law, submitted audited financial statements and fiscal year corporate income tax finalization declaration to the tax administration agency directly.
– Transfer profits abroad at the end of direct investment activities in Vietnam.
Foreign investors may transfer profits abroad upon completion of direct investment activities in Vietnam after the enterprise in which the foreign investor participates in investment has fulfilled its financial obligations to the Vietnamese State in accordance with law, have submitted audited financial statements and corporate income tax finalization declarations to the directly hired management agency and fully fulfilled obligations as prescribed by the Law on Tax Administration 2019.
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Conditions for transferring profits abroad
When transferring profits abroad, investors need to comply with the following conditions:
– Fulfill all financial obligations to Vietnam countries, including fulfilling obligations as prescribed by the Law on Tax Administration in case of termination of investment projects;
– Submitted audited financial statements and corporate income tax finalization declaration for fiscal year;
– No more accumulated losses after transferring losses according to regulations.
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Notice of transfer of profits abroad
At least 07 working days before transferring profits abroad, the foreign investor shall directly or authorize the enterprise in which the foreign investor participates in investment to notify the transfer of profits abroad according to the form and send it to the tax authority directly managing the enterprise in which the foreign investor invests.
The contents of the notification form for transfer of profits abroad should provide complete, accurate and detailed the following information:
– Foreign investor (name, nationality);
– Foreign investor enterprises participating in capital investment;
– Registration of profits transferred abroad by investors;
– The amount of profit offered to be transferred abroad;
– The investor’s commitment to the information in the notification form is completely true. If it is false, it will be solely responsible in accordance with the provisions of law.
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Dossiers of profit transfer abroad
– Notification of profit transfer according to the form issued together with Circular 186/2010.TT-BTC;
– Power of attorney of the foreign investor for the invested enterprise to submit the application;
– Other attached documents on determining the amount of profit transferred abroad, specifically:
- For limited companies: The decision to transfer profits abroad of the invested enterprise.
- For joint-stock companies: Resolution of the General Meeting of Shareholders on the implementation of dividend payment.
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