Decree No. 320/2025/ND-CP, which provides guidance to Vietnam’s new Corporate Income Tax (CIT) Law, has come into effect on 15 December 2025. These new regulations introduce significant changes to the taxation of capital gains from share or capital transfers made by foreign investors. Specifically, the current 20% CIT on net gains will be replaced by a deemed tax rate of 2% on gross proceeds from the transfer of capital contributions in limited liability companies or from the sale of shares in non-public joint-stock companies.
Importantly, the new rules apply to both direct transfers of shares in Vietnamese companies and indirect transfers involving offshore entities that hold Vietnamese subsidiaries.
The decree further clarifies that certain internal restructuring transactions will fall outside the scope of capital gains taxation, particularly transactions involving an internal group restructuring, provided that such restructuring does not result in a change of the ultimate parent company of the parties that directly or indirectly hold ownership interests in a Vietnamese enterprise following the restructuring, and does not generate any income.
Note that Decree 320/2025/ND-CP does not yet include the updated tax declaration form for applying the new 2% deemed rate. Taxpayers may need to await further guidance, likely to be provided in the upcoming circular to be issued by the Ministry of Finance, on the specific tax filing template.
The information provided here is for information purposes only and is not intended to constitute legal advice. Legal advice should be obtained from qualified legal counsel for all specific situations.
