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For a foreign business, doing business in Vietnam on its own account normally means owning a Vietnamese company: a legal entity registered by a provincial Department of Finance that can hire staff, sign local contracts and invoice customers in dong. Manufacturers use one to run a plant, software and service firms to employ engineers and serve local clients, and traders to import and distribute, where their business lines are open to foreign capital.
The usual vehicle is a limited liability company owned by the foreign parent or founder. Groups that want a regional holding company may place it elsewhere, for example in Singapore, and hold the Vietnamese company underneath; this guide covers the Vietnamese company itself.
| Form | Statute | Typical use by foreign investors |
|---|---|---|
| Limited liability company, one owner | Law on Enterprises 2020 | Wholly owned subsidiary of a foreign parent or a single founder |
| Limited liability company, 2 to 50 members | Law on Enterprises 2020 | Joint venture with a Vietnamese or foreign partner |
| Joint stock company, 3 or more shareholders | Law on Enterprises 2020 | Companies raising equity or preparing to list |
| Branch | Commercial Law 2005, Decree 07/2016/ND-CP | Foreign traders with at least five years of operation, in sectors where branches may trade |
| Representative office | Commercial Law 2005, Decree 07/2016/ND-CP | Liaison and market research, without profit-generating business |
A foreign-owned company of any of the three corporate types also needs an investment registration certificate for its project. The order of the filings, the documents and the capital rules are explained on company formation in Vietnam.
| Tax | Position in 2026 |
|---|---|
| Corporate income tax | 20%, under the Law on Corporate Income Tax No. 67/2025/QH15, applied from the 2025 tax year |
| Smaller companies | 15% where the previous year’s revenue was at most VND 3 billion, 17% up to VND 50 billion, unless related parties disqualify the company |
| Incentives | Preferential 10% or 17% rates and tax holidays for encouraged sectors and locations; a three-year exemption for new small and medium-sized enterprises |
| VAT | 10% standard, 5% and 0% reduced rates; most 10% supplies taxed at 8% from 1 July 2025 to 31 December 2026 |
| Dividends paid abroad | No withholding tax for corporate shareholders; 5% for individuals |
| Interest and royalties to non-residents | 5% and 10% for companies, subject to the roughly 80 tax treaties |
| Business licence tax | No longer collected from 1 January 2026 |
| Large multinational groups | 15% minimum effective rate through an income inclusion rule and a domestic top-up tax, from fiscal years starting on 1 January 2024, for groups with revenue of at least 750 million euros |
The 8% VAT rate does not cover telecommunications, banking, securities, insurance, real estate business, metal products, most mining products or goods under special consumption tax, which stay at 10%. The reduction runs to 31 December 2026 unless it is extended. Payments to foreign suppliers can also attract foreign contractor tax, a combination of corporate income tax and VAT withheld by the Vietnamese payer.
Foreign investors start from equal treatment. The Law on Investment No. 143/2025/QH15 gives them the same market access as Vietnamese investors except in the business lines the Government lists as restricted, either closed for now or open on conditions such as a cap on the foreign share or a required form of investment. In every other line a foreign owner may hold the whole company. A Vietnamese citizen holding capital in their own name on behalf of a foreigner is not a lawful substitute: Decree 296/2026/ND-CP prohibits it.
Owners may live anywhere, but management has a local anchor: the company must always have at least one legal representative residing in Vietnam. Since 1 July 2025 every company must also collect, update and keep information on its beneficial owners, meaning, under Decree 296/2026/ND-CP, individuals holding 25% or more of the capital or votes directly or indirectly, otherwise those who control it, and give it to the authorities on request.
Foreign money enters a Vietnamese company through an investment capital account at an authorised bank, under State Bank of Vietnam Circular 38/2026/TT-NHNN, which replaced the 2019 rules on 18 August 2026 and allows the account to be opened before the investment certificate is issued. Opening the company’s accounts brings the legal representative to the bank, which meets that person and checks biometric data when an account is opened at the counter (Circular 25/2025/TT-NHNN). Each bank applies its own review of owners and activity. The steps and what banks ask for are covered on bank account opening for Vietnam companies.
Form a new company when you want to choose the name, business lines and capital yourself, when your plan is an investment project such as a factory or a site that will need an investment registration certificate in any case, or when the three-year tax exemption for new small companies is worth having. The two orders of registration are set out on company formation in Vietnam.
Buy a ready-made company when an existing registration in suitable business lines is what you need. Vietnamese law issues no investment certificate for buying capital in a company; a foreign buyer going above 50% registers the purchase with the investment authority instead, under the same market access conditions. The transfer is explained on ready-made shelf companies in Vietnam, and the idea in general in our guide to off-the-shelf companies.
We form new Vietnamese companies and supply ready-made ones, draw up the investment, formation and transfer papers, prepare the filings with the investment and business registers and help put together the bank application. Where we have a working contact at a suitable bank we can introduce you; the bank takes its own decision.
The VAT Law No. 48/2024/QH15 sets three rates: 10% as the standard, 5% for listed essentials such as clean water, medicines and many farm products, and 0% for exports. A National Assembly resolution cuts most 10% supplies to 8% from 1 July 2025 to 31 December 2026, but not telecoms, finance, insurance, real estate or goods under special consumption tax.
The standard corporate income tax rate is 20%. The 2025 law kept it and added 15% for companies whose previous-year revenue was at most VND 3 billion and 17% for revenue up to VND 50 billion. Oil and gas pays 25% to 50%, and encouraged sectors and locations can obtain 10% or 17% for set periods with tax holidays.
Not for 2026 onwards. Article 10(7) of Resolution 198/2025/QH15 ends the collection and payment of the business licence levy, known as môn bài, from 1 January 2026. Amounts that fell due for 2025 and earlier years are not cancelled, so a company bought or reviewed now should show that its earlier years were settled.
Vietnam levies no withholding tax on dividends paid to corporate shareholders, resident or not; individual shareholders bear 5%, which a treaty may reduce for non-residents. Interest paid to a foreign company bears 5% and royalties 10%, both subject to the applicable tax treaty.
Yes, to large groups only. Vietnam applies an income inclusion rule and a qualified domestic minimum top-up tax at 15% for fiscal years beginning on or after 1 January 2024, covering groups with consolidated revenue of at least 750 million euros in two of the four preceding years. It has not adopted the undertaxed profits rule.
Comparing Vietnam with other places for your next company? Tell us the activity and how the shares would be held, and we will say whether the business lines are open to foreign capital and whether a ready-made Vietnamese company is available now. Telegram and WhatsApp reach us at +48 663 247 166.