With year end approaching, companies should be preparing for their annual tax compliance. The annual corporate income tax and transfer pricing returns must be submitted by 31 March 2015, with penalties applying for late submission and interest for late payment.
The tax regulations are constantly changing and so is the interpretation and application by the tax authorities. In 2014, many new CIT regulations have been issued, adding to the already complex and difficult to interpret rules. This presents a challenging environment for companies, which have to stay abreast of developments and determine the impact for their business in order to self assess their tax status.
A new transfer pricing declaration form, Form 03-7/TNDN (“Form 3”), will apply for 2014, with enhanced disclosure requirements, specifically requesting taxpayers to selfassess whether the pricing of their related party transactions is arm’s length. In order to accurately complete the form, taxpayers will need to have conducted some analysis in advance of completing the form (that they could produce to the tax authorities upon request). Form 3 places a greater burden on taxpayers to self assess (and voluntarily selfcorrect) their transfer prices and also represents part of the increase in transfer pricing enforcement activities, and the accuracy of the declarations made is critical.
Companies need to understand the significance of these changes and need to ensure tax filings are correct and effective tax rates ar effectively managed. PwC Vietnam would be pleased to assist your company in preparing or reviewing the 2014 corporate income tax and transfer pricing returns. Please contact us if you wish to discuss further.