Official letter No. 57837/CTHN-TTHT dated November 25th, 2022 of the Department of Taxation of Ha Noi city regarding tax policies applicable to foreign contractors

According to opinions of the Department of Taxation of Ha Noi city, in case a foreign forwarding company earns incomes from provision of international transportation services from Vietnam to foreign countries on the basis of contracts signed with Vietnamese enterprises, it shall be responsible to perform withholding tax according to clause 1 Article 1 of Circular No. 103/2014/TT-BTC with the enterprise income tax (EIT) of 2% upon revenue (with regard to value added tax VAT, the international transport services shall be entitled to 0% VAT.

The Vietnamese party shall be responsible for withholding and paying withholding tax on behalf of the foreign party if the latter fails to meet any of the conditions to directly declare and pay tax according to Article 8 of Circular No. 103/2014/TT-BTC.