We already shared you the information of foreign contractor tax such as the concept, the tax payer, the exemption from foreign contractor tax, the identification of foreign contractor tax when arising foreign elements. A kind reminder, foreign contractor tax roughly is a tax collected from foreign organizations and individuals that do not register their business in Vietnam, but have benefits in land, sea, airspace, underground, cyberspace in the territory of Vietnam.

In business activities, most businesses encounter a case of sales but not receiving money. There are many reasons for not receiving money such as: disagreement between the seller and the buyer; the buyer has financial difficulties, runs away ,or goes bankrupt. In order to solve the above problem, according to international accounting and tax practices, the State allows enterprises to include in deductible expenses when calculating corporate income tax on irrecoverable receivable debts.

Foreign Contractor Tax is no longer new tax, but enterprises concurrently are always confused or cannot acknowledge whether they have incurred foreign contractor tax. We would like to share 2 topics for your reference: What is foreign contractor tax, and how to calculate foreign contractor tax?

One of the major requirements of the audited financial statements is that the certified financial statements are presented truly and fairly. In order to confirm that the financial statements give a true and fair view, standards of auditing not only require a review of the events that occurred during the fiscal year, but also require the auditor to consider the events occurring between the end of the reporting period and the date when the financial statements are authoried for issue.

If I think about the word "tax", I will immediately think of the amount to be paid. However, the value-added tax has a tax rate of zero percent (0%) applied to exported goods and services. So, what does zero rate (0%) for VAT mean? Firstly, ceding the right to tax value added to the place of final consumption. This is consistent with the nature and international practice of value added tax. Secondly, to encourage exports and create conditions for domestic enterprises to compete on price with other countries. Thirdly, enterprises trading in goods and services subject to zero rate (0%) may deduct or refund input value-added tax. This is the content increasing internal financial resources for domestic companies.