Business practicalities

Land and property rights

A valid address is required to establish a business in Vietnam. Office or factory space can be found independently or through a local real estate agent.

Under Vietnam’s Constitution, the state collectively owns and manages all land. As such, neither foreigners nor Vietnamese nationals can own land. However, the government grants land use and building rights to individuals and businesses in the form of land use rights certificates.

If land is unoccupied or not used according to the conditions set out in the land use rights certificate, the rights revert to the government. If investors do not use leased land within 12 months from the original investment schedule, the government is also entitled to reclaim the land. Investors can apply for an extension of up to 24 months.

A land use rights certificate proves that someone has land use rights and asset ownership. The certificate can be applied for at the Department of Natural Resources and Environment’s Land Registration Office and its branches.

Intellectual property (IP)

Vietnam’s legal framework supporting intellectual property (IP) rights is relatively strong. As a member of the World Trade Organisation, it has committed to common standards for the protection and enforcement of IP. It is a signatory to the Paris Convention, the Berne Convention, the Madrid Protocol and the Patent Cooperation Treaty. It has also upgraded IP protections to bring them in line with its obligations under the CPTPP.

The IP framework is coordinated by the National Office of Intellectual Property (NOIP). Under the authority of the Ministry of Science and Technology, it administers IP protections and conducts basic assessments to settle IP disputes.

There are six types of intellectual property in Vietnam: trademarks, patents, copyright, industrial designs, geographical indications and trade secrets. The following mechanisms are used for registering trademarks, patents and copyright:

Violation of IP and enforcement options: Despite a relatively strong IP protection framework, violations persist. Businesses seeking to enforce their IP rights in Vietnam have three options:

• Administrative action
• Civil court action
• Criminal prosecution

Most IP disputes are handled through administrative action. Government authorities can issue warnings, fines and the seize and destroy of counterfeit goods. Businesses should consult IP Australia for further advice.

Import duties and tariffs

Import duty rates come in three categories: Ordinary rates, preferential rates and special preferential rates.

• Ordinary rates apply to goods imported from countries outside the WTO This rate is the equivalent of the most-favoured nation (MFN) rate with a surcharge of 50 per cent.
• Preferential rates apply to goods from countries that have MFN status with Vietnam. MFN rates are applicable to goods imported from any WTO member state.
• Special preferential rates apply to goods from countries that have a preferential trade agreement with Australian businesses qualify for special preferential rates through the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA), the CPTPP and the Regional Comprehensive Economic Partnership (RCEP).

To find the tariff rate for specific goods, visit the Department of Foreign Affairs and Trade’s FTA Portal. The Customs Department of Vietnam is responsible for levying tariffs on imported goods.

Special Sales Tax (SST) applies to some products in addition to import duties. Value Added Tax (VAT) will also be applied to imported goods and services (unless exempt under the VAT regulations).

Calculations and payments

Vietnam follows the WTO Valuation Agreement on imported goods with certain variations. Import duty is calculated by multiplying the imported good’s dutiable value by the corresponding import duty rate. The dutiable value of imported goods is typically based on the cost, insurance and freight (CIF) level.

Import duties and taxes in Vietnam must be paid before customs clearance. Foreign businesses importing into Vietnam can register, declare and pay taxes through the web portal set up by the General Department of Taxation (GDT).

Exemptions

Import duty exemptions are provided for a range of goods, including:

• Machinery and equipment that are fixed assets of a company and are eligible for incentives.
• Raw materials and components that cannot be manufactured locally.
• Materials and equipment used for the production of export goods.

Export duties

Export duties are charged on only a few items – mainly natural resources such as sand, chalk, marble, granite, ore, crude oil, forest products and scrap metal. Rates vary from 0 up to 40 per cent.

Import and export regulations

The Ministry of Industry and Trade (MoIT) is responsible for regulating trade in Vietnam. It issues regulations, usually in the form of ‘circulars’, which provide the legal basis for what can be imported to or exported from Vietnam. The Customs Department of Vietnam enforces trade regulations.

Vietnam’s General Department of Taxation imposes a wide-ranging tax regime that includes income taxes (corporate and personal), turnover and indirect taxes (VAT and specific business tax), as well as property tax, stamp duty, excise, customs duties and municipal taxes.

This section provides an overview of the taxes Australian businesses can expect to face when operating in Vietnam. Not all applicable taxes are covered in this guide and the information provided is of a general nature. Businesses should seek professional tax advice for understanding the taxes specific to their activities.

Table 1: Overview of Vietnam’s taxes for businesses

Corporate Income Tax (CIT)

Businesses are subject to the tax rates imposed under the corporate income tax (CIT) law (Table 1). The standard CIT rate is 20 per cent. Companies incorporated in Vietnam are taxed on their worldwide income.

Foreign companies conducting business in Vietnam without establishing a local legal entity and/or receiving Vietnam-sourced income are considered foreign contractors. Foreign contractor income is subject to Foreign Contractor Tax, which includes Value Added Tax (VAT) and elements of CIT.

CIT rates of 10, 15 and 17 per cent apply to investments in key sectors and locations. New laws governing CIT come into effect on October 1, 2025. Changes include the formal inclusion of foreign enterprises supplying goods and services in Vietnam via e-commerce and digital technology platforms as CIT taxpayers. These platforms are now recognized as permanent establishments (PEs) in Vietnam, meaning income derived from Vietnamese users or markets is subject to local tax obligations. The new law also introduced tiered tax rates that vary by enterprise size, offering lower rates for smaller businesses. Priority sectors include education, healthcare, sport and culture, high technology, environmental protection, scientific research and technology development, infrastructure development, processing of agricultural products, software production and renewable energy. Priority locations are those in designated high-tech zones, industrial zones and socio-economic regions. Large investments in the manufacturing sector also receive preferential treatment.

Vietnam has signed double taxation avoidance agreements with more than 80 other countries, including Australia. These treaties eliminate double taxation by identifying exemptions or reducing liabilities in Vietnam for Australian businesses and residents.

Personal income tax

Individuals who meet one or more of the following criteria are classified as tax residents under Vietnamese law:

• Have been physically present in Vietnam for 183 days or more in either the calendar year or for 12 consecutive months from the first arrival date
• Have a permanent residence in Vietnam
• Have a leased house (or hotel room, guest house, location of office etc.) in Vietnam with a total term of 183 days or more in a tax year, and unable to prove tax residence in another country (by providing a foreign certificate of tax residency).

Personal income tax (PIT) applies to tax residents’ worldwide taxable personal income, regardless of whether it is paid or received domestically (Table 2).

For individuals not classified as tax residents, a flat PIT rate of 20 per cent applies to employment income from Vietnam. However, the double taxation agreement between Australia and Vietnam may affect this rate. 

On 22 July 2025, Vietnam’s Ministry of Finance released a draft Personal Income Tax Law.  Key proposals in the draft law include expanding taxable income to cover digital platforms, e-commerce, and digital assets; introducing exemptions for innovation, green technology, and skilled labour; applying a separate tax rate for digital services; simplifying the progressive tax table; and allowing deductions for medical and educational expenses. It is expected to be submitted to the National Assembly in October 2025.

Table 2: Personal income tax rates

Indirect taxes

Value added tax (VAT): VAT is a broadly based consumption tax applied to most goods and services bought and sold in Vietnam. All companies and individuals conducting business in Vietnam must pay VAT on applicable goods and services.

VAT is charged at three different rates:

• 0 per cent: Applies to exports and includes goods and services processed for export or in-country export (conditions apply).
• 5 per cent: Applies to essential goods and services (including books, unprocessed foodstuffs, various agricultural products and services, medicine and medical equipment and cultural, artistic and sport services, among others).
• 8 per cent: The standard VAT rate that applies to all other goods and services.

VAT is typically set at 10 per cent. It was reduced to 8 per cent in July 2023 and extended until June 30, 2025 as part of the government’s economic support measures.

Special Sales Tax (SST): Vietnam’s special sales tax applies to a range of luxury goods and non-essential items. It is sometimes referred to as a ‘sin’ tax or ‘luxury’ tax. It applies to a range of goods, including cigarettes, alcohol and luxury cars. Rates range from 7 to 75 per cent.

Natural resources tax: A natural resources tax applies to industries using or developing Vietnam’s natural resources. This includes metallic and non- metallic minerals, crude oil, natural gas, petroleum minerals, forest and aquatic products. Rates range from 1 to 40 per cent.

Property taxes: Foreign businesses pay rental fees for land use rights. Rates vary depending on location, connected infrastructure and the industrial sector in which the business is operating.

Land tax is charged to owners of non-agricultural property. Progressive tax rates range from 0.03 to 0.15 per cent based on land area and prescribed price per square metre.

Environment protection tax: A key pillar of Vietnam’s transition to a green economy, this tax is applied to the production and importation of goods that are deemed to cause negative environmental impacts, such as coal, petroleum and plastic bags. A 50% reduction of the tax continues through to December 2025 on gasoline, diesel, jet fuel , kerosene and lubricants.

Auditing and accountancy play a vital role in enhancing transparency and accountability in a business, especially one engaged in a foreign market. It increases business performance by identifying risks and highlighting areas for improvement.

Accounting standard

Local and foreign businesses are required to comply with the Vietnam Accounting Standard (VAS) when recording financial transactions. Australian businesses with Vietnamese operations often manage two accounting records, one based on VAS and the other on Australian Accounting Standards (AAS).

The Vietnam Ministry of Finance (MoF) is the standard-setting body. Vietnam is rolling out International Financial Reporting Standards (IFRS) as part of its efforts to improve comparability and transparency. A voluntary application period will apply until 2025, in which businesses can apply IFRS in preparation of consolidated financial statements. IFRS will become mandatory in 2026 for certain entities, particularly listed companies, large-scale foreign-invested enterprises and financial institutions.

Statutory audits

Annual financial statements of foreign-invested business entities must be audited by an independent auditor in Vietnam. Audits are performed according to the VAS and must be completed within 90 days of the end of the financial year.

Books and records

Accounting records should be in the Vietnamese language, although this can be combined with another commonly used foreign language like English.

The Vietnamese Dong (VND) should be used as the accounting currency. However, businesses that operate in a foreign currency can select that currency for their accounting records and financial statements. For statutory reporting, the foreign currency must be converted to the VND equivalent.

The Vietnamese financial year is the calendar year (1 January – 31 December). All companies must retain records used in the preparation of their accounting books for 10 years, and five years for other accounting documents.

Quality control

The independent audit oversight authority in Vietnam is the Accounting and Auditing Supervisory Department (AASD) of the MoF and the State Securities Commission (SSC).

The MoF is responsible for establishing quality assurance review systems for auditors in Vietnam. This process includes a self-assessment by audit firms of their systems of quality control relating to audits of financial statements, a review of quality control policies and procedures and an assessment of accounting and auditing compliance standards. MoF sets the criteria for judging whether a quality assurance review is successful.

There are no members of the International Forum of Independent Audit Regulators in Vietnam.

Doing business in Vietnam will often require employing local and foreign workers. Understanding Vietnam’s labour market regulations, recruitment methods and country-specific management styles is crucial to building and supporting an effective team.

Labour market

Skill level: The skill level of the Vietnamese workforce is increasing alongside growing rates of educational attainment. Although Vietnam achieves high levels of primary and secondary enrolment, skills shortages persist in key sectors.

Employment contracts: Businesses can hire workers on either employment or service contracts. Employment contracts are either fixed-term or ongoing. A service contract is an alternative form of employment designed to fill a specific and temporary skills gap. These are often used by foreign firms in

Vietnam, particularly in the gig economy. Rather than a salary, fees are paid for services rendered. Details like location, working hours and days of leave are more flexible and contracts typically do not include leave entitlements or insurance coverage.

Minimum wage: The 2024 monthly minimum wage for employees in all non-state-owned enterprises is based on geographic zones determined by the government.

For Vietnamese employees who work for foreign companies, wages are determined through negotiations between the two parties. Wages cannot be lower than the minimum monthly salary rates above.

Human resources and employment law: Vietnam continues to streamline its labour laws and policies to promote integration with global business practices. The Labour Code provides the legal framework for employers and employees with regards to working hours, labour agreements, social insurance, overtime, strikes and termination.

Working hours: The working hour limit is 48 hours per week. Normal working hours cannot exceed 8 hours per day without an overtime agreement.

Holidays: Workers employed for more than 12 months are entitled to 12 days of paid leave. For every five years of service this entitlement increases by one day. For workers employed for less than 12 months, annual leave is accrued on a pro-rata basis.

Overtime: Overtime is limited to 200 hours per year, or up to 300 hours per year under special circumstances. If an employer and employee agree on an overtime deal, overtime cannot exceed 40 hours per month and 300 hours per year.

Sick leave: Under the Labour Code, Vietnamese workers’ sick leave entitlements are determined by how long they have been contributing to the social insurance fund.

• An employee who has contributed to the social insurance fund for less than 15 years is entitled to 30 days per year.
• An employee who has contributed to the fund for between 15 and 30 years is entitled to 40 days per year.
• An employee who has contributed for 30 years or more is entitled to 60 days per year.

Social, health and unemployment insurance contributions: Social insurance (SI) and unemployment insurance (UI) contributions are applicable to Vietnamese employees only. Health insurance (HI) contributions are required for both Vietnamese and foreign employees on Vietnam employment contracts.

Ending employment: Employers and employees can unilaterally terminate an employment contract. Employers must give 120 days’ notice for ongoing or fixed-term contracts of more than 12 months.

For fixed-term contracts of less than 12 months, employers must give notice of at least one quarter of the term of the contract. Service contracts naturally end at the conclusion of the project but can also be terminated by the hiring party with 30 days’ notice.

Severance pay: If an employer terminates the employment of an employee who has been with the organisation for more than 12 months, severance pay must be provided. The minimum severance pay is half a month’s salary for each year of employment. In cases of employee misconduct or illegal activity, severance pay does not apply.

Recruiting staff

Online advertising: Online job advertisements are an effective way to access talent. There are a number of useful websites in Vietnam for online advertising:

• VietnamWorks is the most popular online job search portal. It can be accessed in both English and Vietnamese.
• CareerViet.vn is a popular job search site aimed at skilled professionals.
• Timviec365.vn is popular amongst employers for its free posting function.
• Vieclam24h.vn is a recruitment portal that advertises for lower to mid-level roles.
• LinkedIn usage continues to grow, with 13 per cent of Vietnamese internet users using the platform each month.

Executive search and recruitment: Executive search firms can provide tailored searches for more senior roles. International firms such as ADECCO, Harvey Nash, Talentnet and Robert Walters have offices in Vietnam.

Work permits: Vietnamese entities can recruit foreign workers to senior positions where local hires are not able to meet production and business

requirements. From July 2025, work permits will be issued, extended and revoked by provincial People’s Committees via Home Affairs. Permits are valid for three years and can be renewed. An applicant must be:

• At least 18 years of age.
• In good enough health to satisfy the job requirements.
• A manager, executive director or expert with technical skills and knowledge necessary for the job.
• Not have a criminal record or be subject to criminal prosecution.

The Vietnamese entity must publicly advertise for the position in a newspaper or online at least 30 days prior to recruiting the foreign employee. The advertisement should be included in the application for the work permit for the foreign employee.

Foreign companies establishing a presence in Vietnam will need a local bank account to conduct business.

Foreign companies may open accounts denominated in VND, USD and other foreign currencies. The Vietnamese banking sector includes domestic commercial banks, state-owned commercial banks, joint venture and wholly foreign-owned banks, foreign bank branches and cooperative banks.

To open a bank account in Vietnam, you will most likely need to visit a branch and present your passport as proof of identity. You will also need proof of employment in Vietnam. If you have a business in Vietnam, a business certificate will be required.

The three types of bank accounts available in Vietnam are:

• Normal local/foreign currency account. This is the most common type of bank account. Funds can be transferred into and out of this type of account, usually without a monthly limit. Accounts can usually be opened in either VND or USD.
• Deposit account. Deposit bank accounts are designed for taking deposits and accumulating savings over time.
• Offshore foreign currency account. This is a special type of account that may be useful for some businesses and individuals. In addition to meeting certain criteria, approval is required from the State Bank of Vietnam to open these accounts.

Foreign exchange controls

The VND is not freely convertible and cannot be remitted overseas. The Vietnamese Government has been implementing measures to gradually reduce the country’s dependence on the US Dollar. All buying, selling, lending and transfer of foreign currency must be made through banks and other financial institutions authorised by the State Bank of Vietnam. As a general rule, all monetary transactions in Vietnam must be undertaken in VND.

Foreign invested enterprises may, subject to certain conditions, buy foreign currency from banks to make foreign currency payments to overseas parties.

The outflow of foreign currency by transfer is only authorised for some transactions such as:

• Payments for imports and services from abroad
• Repayment of offshore loans and the payment of interest
• Transfers of profits and dividends
• Transfers of technology/royalties.

Foreign enterprises and foreigners working in Vietnam are permitted to transfer profits and income earned in Vietnam internationally. Remaining invested capital at the end of an investment project can also be transferred abroad. Supporting documents showing the legitimate purpose of transferring foreign currency abroad must be submitted to the remitting bank to purchase and remit foreign currency.

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