Vietnam MOF Clarifies Taxation of Foreign Businesses Performing Software Maintenance Services

The Vietnamese Ministry of Finance July 25 clarified the taxation of foreign businesses carrying out software maintenance services through the internet without a permanent establishment in Vietnam. The clarification explained that foreign businesses earning income or performing business in Vietnam are subject to a foreign contractor tax that is divided into VAT and corporate income tax (CIT). The clarification further explained that the software maintenance services: 1) aren’t subject to VAT; but 2) are subject to 5 percent CIT on taxable turnover. [Vietnam, Government Portal, 07/25/19]

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