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THE MINISTRY OF
FINANCE OF VIETNAM
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SOCIALIST
REPUBLIC OF VIETNAM
Independence - Freedom - Happiness
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No.:
67/2022/TT-BTC
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Hanoi, November
07, 2022
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CIRCULAR
GUIDELINES ON TAX OBLIGATIONS INCURRED UPON CONTRIBUTION AND USE OF
FUNDS FOR SCIENCE AND TECHNOLOGY DEVELOPMENT IN ENTERPRISES
Pursuant to the Law on Tax
Administration No. 38/2019/QH14 dated June 13, 2019;
Pursuant to the Law on
Corporate Income Tax No. 14/2008/QH12; the Law No. 32/2013/QH13 providing
amendments to the Law on Corporate Income Tax; the Law No. 71/2014/QH13
providing amendments to tax laws;
Pursuant to the Resolution No.
43/2022/QH15 dated January 11, 2022 of the National Assembly on fiscal and
monetary policies for supporting Socio-economic recovery and development
program;
Pursuant to the Government’s
Decree No. 126/2020/ND-CP dated October 19, 2020 on elaboration of the Law on
Tax Administration;
Pursuant to the Government’s
Decree No. 218/2013/ND-CP dated December 26, 2013 elaborating and providing
guidelines for implementation of the Law on Corporate Income Tax;
Pursuant to the Government's
Decree No. 95/2014/ND-CP dated October 17, 2014 prescribing investment and
financial mechanisms for science and technology activities;
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Pursuant to the Government’s
Decree No. 87/2017/ND-CP dated July 26, 2017 defining functions, tasks, powers
and organizational structure of the Ministry of Finance of Vietnam;
At the request of the Director
General of the General Department of Taxation;
The Minister of Finance of
Vietnam promulgates a Circular providing guidelines on tax obligations incurred
upon contribution to and use of Funds for Science and Technology Development in
enterprises.
Article 1.
Scope and regulated entities
1. Scope: This Circular provides
guidelines on tax obligations incurred upon contribution to and use of Funds
for Science and Technology Development in enterprises (hereinafter referred to
as “Funds”).
2. This Circular applies to:
Enterprises that are established and operating in accordance with regulations
of law of Vietnam (hereinafter referred to as “enterprises”), regulatory
authorities, and other relevant organizations and individuals.
Article 2.
Contribution to Funds
1. Each enterprise shall annually
make contribution as a percentage (%) of its income subject to corporate income
tax (CIT) to the Fund as prescribed in Clause 1 Article 17 of the Law on
corporate income tax No. 14/2008/QH12, Clause 1 Article 18 of the Government’s
Decree No. 218/2013/ND-CP dated December 26, 2013, and Clauses 1, 2 Article 9
of the Government’s Decree No. 95/2014/ND-CP dated October 17, 2014. To be
specific:
a) A state-owned enterprise shall
make a contribution equaling 3% - 10% of its income subject to CIT in the tax
period. The specific contribution amount shall be subject to the enterprise’s
capacity and planned funding for science and technology activities;
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2. Contributions to the Fund shall
be determined in each CIT period and deducted from taxable income upon
determination of CIT amount payable by the enterprise in the tax period.
Article 3. Rules
for using the Fund
1. The Fund of an enterprise shall
be used for financing its science and technology research and development
activities and other tasks to be financed by the Fund as prescribed by law.
2. Any payments using the Fund
must be supported by adequate invoices and receipts as prescribed. With regard
to payments made using the Fund without invoices or receipts as prescribed, the
enterprise is required to fulfill obligations to state budget as prescribed in
Clause 1 Article 4 of this Circular.
3. An enterprise is not allowed to
include the following amounts in its deductible expenses upon determination of
CIT in the tax period, including payments made using the Fund and late payment
fines and/or interests on CIT amounts payable determined according to the
provisions of Clauses 1, 2 Article 4 of this Circular.
4. The Fund shall be used
following the first in first out principle.
5. If an enterprise needs to
overspend the Fund in a year on science and technology tasks, it shall include
spending amounts in its deductible expenses upon determination of CIT in the
tax period or use the planned contributions to the Fund for subsequent years
for covering the insufficient amount as prescribed in Clause 7 Article 10 of
the Government’s Decree No. 95/2014/ND-CP dated October 17, 2014.
Article 4. Tax
obligations incurred in case of misused, unused or underused Fund
1. Tax obligations incurred in
case of misused Fund
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2. Tax obligations incurred in
case of unused or underused Fund
a) Within 05 (five) years from the
establishment of the Fund as prescribed in Article 2 of this Circular, if none
or less than 70% of the amounts annually contributed to the Fund has been used,
the enterprise shall incur the CIT on unused amounts and interests on such CIT
amount payable. Interests charged on the CIT amount payable shall be determined
according to the provisions of Point b Clause 2 of this Article.
In case of transfer between Funds,
the 05-year period regarding the amount transferred to the Fund of an
enterprise shall start from the CIT period in which money is transferred to the
enterprise’s Fund.
b) Interests shall be charged on
the CIT amount payable on the unused amounts of the Fund at the interest rate
of 1-year treasury bonds in effect upon the payment of such CIT amount for a
period of 02 years as prescribed in Clause 2 Article 17 of the Law on corporate
income tax No. 14/2008/QH12.
c) The used amounts of the Fund
include: payments properly made using the Fund which have been recorded as
prescribed; the sums advanced which are supported by adequate invoices and
receipts but yet to be recorded for performing the Fund’s activities; amounts
transferred from the Fund of a corporation to its affiliates, or from a parent
company to its subsidiaries or vice versa; and amounts paid to the National
Foundation for Science and Technology Development or to the relevant
ministerial or provincial Fund for science and technology development (if any)
in accordance with regulations of the Ministry of Science and Technology of
Vietnam.
Transfer of money between Funds of
a parent company or corporation and its subsidiaries or affiliates shall only
apply to subsidiaries or affiliates of which 100% of charter capital is held by
the parent company or corporation, and is not applied in the following cases:
- Transfer of money from a
foreign-invested enterprise to its parent company located abroad;
- Transfer of money from a parent
company located in Vietnam to its subsidiaries located abroad.
3. If both the receiving
enterprise and the transferring enterprise are not eligible to CIT incentives,
the CIT rate used for calculating the CIT amount payable shall be the one
applied to the enterprise in each tax period upon contribution to its Fund or
at the time of transfer of money between their Funds.
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a) If an enterprise makes
contribution to its Fund while it is enjoying CIT incentives (preferential CIT
rate, tax exemption or tax reduction), and misuses or uses none or less than
70% of the amounts contributed to its Fund during the period of enjoyment of
CIT incentives, the CIT amount payable shall be calculated at the preferential
CIT rate applied upon its contribution to the Fund.
b) If an enterprise makes
contribution to its Fund while it is enjoying CIT incentives, has received
money from the Fund of another enterprise (transferring enterprise), and
misuses or uses none or less than 70% of the sum of amounts contributed to its
Fund and received amounts, the CIT amount payable shall be calculated as
follows:
- With regard to amounts
contributed by the enterprise to its Fund, the CIT amount payable shall be
calculated at the preferential CIT rate applied upon its contribution to such
Fund.
- With regard to amounts received
from another enterprise, the CIT amount payable shall be calculated as follows:
+ If the transferring enterprise
is not eligible to CIT incentives at the time of transfer, the CIT amount
payable shall be calculated at the normal CIT rate.
+ If the transferring enterprise
is enjoying CIT incentives at the time of transfer, the CIT amount payable
shall be calculated at the preferential CIT rate applied to the transferring
enterprise at the time of transfer.
The unused or misused portion of
received amounts shall be determined according to the proportion of such
received amounts to the Fund balance (i.e. the sum of amounts contributed by
the enterprise to the Fund and received amounts).
5. Each enterprise shall itself
calculate, declare and pay CIT amount payable on misused or unused amounts of
its Fund, and assume legal responsibility in accordance with regulations of the
Law on tax administration.
Article 5.
Management of assets created using the Fund
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a) Fixed assets created to serve
the enterprise’s science and technology activities;
b) Machinery and equipment
purchased with transferred technologies as prescribed in Article 7 of the Law
on Technology Transfer in order to partially or entirely replace the
enterprise’s technologies in use with more advanced ones with the aims of
enhancing productivity and quality of products or developing new products
according to Point c Clause 3 Article 10 of the Government’s Decree No.
95/2014/ND-CP dated October 17, 2014;
c) Machinery and equipment
purchased to serve technology innovation or directly serve the enterprise’s
business in 02 years (2022 and 2023) as prescribed in Point b Clause 3 Article
3 of the National Assembly’s Resolution No. 43/2022/QH15 dated January 11,
2022.
2. Costs of repair or renovation
of fixed assets which have been created using the enterprise’s Fund shall be
also covered by such Fund.
3. If fixed assets which have been
created using the Fund to serve the enterprise’s science and technology
activities are yet to be fully depreciated but are transferred to serve the
enterprise’s business operations, their residual values shall be recorded as
other incomes and depreciated as deductible expenses upon determination of
taxable income.
4. If fixed assets which have been
created using the Fund to serve both science and technology activities and
business operations of the enterprise are yet to be fully depreciated, they
shall be managed in accordance with the Ministry of Finance of Vietnam’s
regulations on management, use and depreciation of fixed assets, and the
enterprise shall not include depreciation of such fixed assets in its
deductible expenses upon determination of taxable income.
5. If fixed assets which have been
created as a result of the enterprise’s science and technology activities are
transferred to serve the enterprise’s business operations, their values shall
be recorded as other incomes and depreciated as deductible expenses upon
determination of taxable income.
6. If fixed assets purchased using
the enterprise’s Fund are transferred, the enterprise shall determine the
residual values of such assets to record an increase or decrease in its Fund
upon transfer of such assets.
7. If fixed assets which are used
for the enterprise’s business operations are transferred to serve its science
and technology activities, their residual values shall be determined to be
recorded as expenses on purchase of fixed assets using the Fund, and shall be
managed according to Clause 1 of this Article.
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9. Other assets shall be managed
and properly used for defined purposes as prescribed.
Article 6.
Management of Funds in case of enterprise restructuring
1. If a new enterprise is
established after the enterprise restructuring in accordance with regulations
of the law of Vietnam, this new enterprise shall inherit, manage and use the
Fund(s) of the former enterprise(s).
2. If the enterprise restructuring
is not subject to the provisions of Clause 1 of this Article, the enterprise(s)
existing after the restructuring shall inherit, manage and use the Fund(s) of
the enterprise(s) existing before the restructuring. Assignment of such Funds
shall be subject to decision of relevant enterprise(s) and must be notified to
tax authorities.
Article 7.
Reporting on contribution, transfer and use of Funds
1. Each enterprise shall make
annual report on contribution to, transfer and use of its Fund using Form No.
03-6/TNDN enclosed with the Circular No. 80/2021/TT-BTC dated September 29,
2021 of the Ministry of Finance of Vietnam.
2. In case of transfer of Funds
between the enterprises as prescribed in Point c Clause 2 Article 4 of this
Circular, the receiving enterprise shall make reports on receipt and use of
transferred money.
3. Reports on contribution,
transfer and use of Funds shall be submitted to the competent authorities
mentioned in Clauses 1, 4 Article 11 of the Government’s Decree No.
95/2014/ND-CP dated October 17, 2014. Such reports shall be submitted within
the same time limit with annual CIT finalization forms.
Article 8.
Effect and implementation
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2. Articles 4, 12, 13, 14, 16, and
17 of the Joint Circular No. 12/2016/TTLT-BKHCN-BTC dated June 28, 2016 of the
Ministry of Science and Technology of Vietnam and the Ministry of Finance of
Vietnam are abrogated.
3. Spending contents and
guidelines for use of Funds and transfer of Funds for science and technology
development of enterprises to the National Foundation for Science and
Technology Development or ministerial or provincial Funds for science and
technology development shall comply with prevailing legislative documents on
science and technology, and regulations adopted by the Ministry of Science and
Technology of Vietnam.
4. If any legislative documents
referred to in this Circular are amended or superseded, the new ones shall
apply.
5. Difficulties that arise during
the implementation of this Circular should be promptly reported to the Ministry
of Finance of Vietnam for consideration./.
PP. MINISTER
DEPUTY MINISTER
Cao Anh Tuan