LEGAL UPDATE: Did you know that if you use the services or purchase goods from foreign entities that are not licensed in Vietnam such foreign entities have to pay tax in Vietnam and that you may have to make such payment on the behalf of such service or goods providers? This tax is called foreign contractors’ tax. The term ‘foreign contractors’ is misleading, as the tax applies to all entities not licensed in Vietnam but provide goods and services in Vietnam (such as distribution, advertising, legal, etc.) and not just construction contractors. Thus, make sure tax is factored in the pricing of goods and services and whether it is included in the price or not and how it is to be paid and such terms are set out in the contract.

(Circular 103/2014/TBTC of the Ministry of Finance, valid 1 October 2014)