Official Dispatch No. 2735/CTBNI-TTHT dated September 12, 2022 of the Tax Department of Bac Ninh province guiding the policy on contractor tax and personal income tax for sales brokerage services abroad
FCT obligations: In Clause 4, Article 2 of Circular 103/2014/TT-BTC dated August 6, 2014 of the Ministry of Finance stipulates:
“Article 2. Entities not regulated by this Circular
…
- Any foreign entity that provides any of the services below for Vietnamese entities, provided the services are provided overseas:
…
– Trade promotion and investment encouragement;
– Brokering goods sale and services provision overseas…;”
Based on the above provisions, in case the Company hires overseas organizations and individuals to provide brokerage services for sales of goods, trade promotion, etc. outside Vietnam , the above activities are not subject to declaration and payment of contractor tax (FCT).
PIT obligation: In case the Company incurred expenditures for foreign individuals to carry out the following activities: enquiring the market, looking for customers, promoting sales activities… of the Company outside the territory of Vietnam, the above expenditures for foreign individuals are subject to PIT. The Company is responsible for deducting personal income tax and paying it into the State Budget before paying income to individuals according to regulations.
