Official letter No. 66297/CT-TTHT dated July 16th 2020 issued by Hanoi Tax Department about The CIT policy on expenses for prevention of Covid-19 pandemic.
According to this Official letter, in case the Company pays for the expenses of masks, anti-bacteria water, and protective accessories for employees to prevent Covid-19 infection, then:
- For PIT purpose: these expenses are not subjected to PIT (regardless expense serve for the general or specific employee);
- For CIT purpose: these expense considered as deductible expense when determine CIT taxable income in accordance with Article 4 of Circular 96/2015/TT-BTC.
This Official Letter replaces Official Letter No. 44403/CT-TTHT dated June 1st 2020, earlier, Hanoi Tax Department have guided for these above expenses spent on specific employee would be subjected for PIT purpose, at once, these expenses are treated as welfare expense and not exceed 1 month’s average salary actual paid in the year.
Besides, Ministry of Finance is in the process of preparing a Decree to guide deductible expenses for expenses related to prevention, sponsorship and support to prevent the pandemic.
Please kindly find detail in the attached file.