How to Overcome the Complexity of the Foreign Contractor Tax in Vietnam Best Practices, Technical & Practical pitfalls Legend Hotel Ho Chi Minh City 7 July 2011 Knowledge that works www.irvingseminar.com Introduction Supplies of goods, services and other income by enterprises without a presence in Vietnam are in nearly all cases subject to the so-called “Foreign Contractor Tax”. This tax collection system covers corporate income tax (“CIT”) and Value Added Tax, but also Personal Income Taxes on income derived by individuals. Engineering and construction projects carried out in Vietnam, supply of equipment and installation, but even loans and insurance arrangements will resort under this tax regime. In most cases, the payer of the income will as far as tax authorities are concerned be liable to deduct the tax at source, file a tax declaration and pay the tax. Although based on simple principles, the FCT is fairly complex in practice. Different tax rates and values apply to different business lines. The process of registration and tax filing, which has a significant effect on actual tax liabilities, is not always clear to the enterprises concerned who must register in which circumstances. Different rules may apply in case a “double taxation agreement” governs the income that is paid abroad. As a result, FCT issues are often highly frequent, important and difficult in the business of many enterprises. An incorrect understanding of the FCT liability may result in penalties, interests or in overpaying taxes that are actually not even due. Enterprises cannot always engage tax consultants for each and every payment. It is, of course, quite beneficial to enterprises that they dispose over a good understanding of how the FCT applies to the payments they make. In this detailed one day seminar, well-known experts of the advisory profession share their valued knowledge and practical experiences with the course registrants. A detailed course program has been designed to meet the needs of key staff of enterprises in this regard. The objective is to provide a detailed practical understanding of the application of the tax, so that registrants are able to determine the tax consequences of real-life cases in their enterprise. Key Points  Which withholding taxes apply to construction, installation and supply of services?  Split services from equipment or not? Pros and cons  How to obtain exemptions based on the double taxation agreement?  Pan Special issues for assigning staff and management fees  Onshore and offshore services: common pitfalls and how to avoid them  Does the FCT apply when the payment is made from abroad? Knowledge that works www.irvingseminar.com www.irvingseminar.com Program 08:15 Registration 09:00 - 10:00 Recent GDT interpretations on FCT 10:00 - 11:00 Problems related to expatriate employees of foreign contractors         Ruling overview and discussion GDT interpretation of permanent establishment Tax planning opportunities Baker & McKenzie Nguyen Thanh Vinh Tax Partner EP Legal Tony Nguyen Managing Director Registration and declaration requirements Who is exempt? Official development Aid project How to fix part non compliance DTA exemption in practice Refreshment 11:30 - 12:30 Payments for onshore and offshore services: pitfalls and tax planning     Which services are exempt of FCT What is use outside Vietnam How does the DTA impact onshore and offshore services Ernst & Young Huong Vu Tax Partner Consulting fees and supervision of construction and installation Lunch Break 14:00 - 15:30 Case studies on FCT      Deloitte Tom McClelland Tax Partner Franchising BOT Oilfield services Management consulting Leasing of equipment Refreshment 16:00 - 17:30 DTA     What to do if the GDT rejects your DTA exemption Practical experiences on DTA situations Mutual agreement procedures Documentation process: How to improve your position Knowledge that works DFDL Edwin Vanderbruggen Tax Partner www.irvingseminar.com Speakers & Panelists Speakers Nguyen Thanh Vinh Tax Partner Mr. Tony Nguyen Managing Director Ms.Huong Vu Tax Partner Ernst & Young Vietnam Mr. Tom McClelland Partner-Tax Partner Mr. Edwin Vanderbruggen Partner Head of Indochina Tax Practice Vinh practiced tax and consultancy work for two international accounting firms for eight years and worked as a compliance counsel for an international insurance company before joining the Ho Chi Minh City office of Baker & McKenzie. He focuses on tax advice and planning on corporate and individual tax issues, banking & finance, and other general corporate matters. Mr. Nguyen is a member of the Bar Association of Ho Chi Minh City. He holds a Bachelor of Arts degree in English from the University of Ho Chi Minh City and an LLB from the University of Law of Ho Chi Minh City Tony practices in the area of commercial transactions advice and common law on contracts with a heavy emphasis on international trade law, shipping law, marine insurance and offshore petroleum transactions. Prior to joining EPLegal in 2009 Tony had worked in legal and contract managerial positions in several giant oil and gas corporations such as PTSC, PVTrans and Cuu Long Joint Operating Company. Tony has legal and contracting experience through various projects related to drilling campaigns; oil and gas development and production operations; sales and purchasing and technical services contracts; chartering of vessels/FPSO/FSO; production services; and EPC/EPIC offshore construction contracts. Ms.Huong Vu is a Tax Partner of Ernst & Young Vietnam. She has 15 years experience in tax and accounting industries. She has actively involved in assisting a diverse range of clients on tax matters, including corporate taxation, value added tax, foreign contractor tax, foreign exchange and financial issues. Huong Vu is particularly in-depth understanding of local regulatory system and various tax and investment regulations. She has expertise in advising on indirect tax issues, including customs duty, value added tax, and special consumption tax. She is leading a team of dedicated indirect tax professionals to provide a seamless, consistent service throughout the country and deal effectively with cross border issues. Tom McClelland has over 17 years’ international tax experience including a total of six years in Vietnam, over a period beginning in 1998. In this time he has provided his multinational and local clients with the full range of tax consulting and compliance services. Tom specialises in the taxation of investment funds and real estate both in Vietnam and internationally.In Vietnam he has advised a large number of offshore and local funds on structuring their real estate investments and currently provides the full range of tax services to a number of foreign invested real estate projects. Tom holds a Masters in Finance from London University and an honours degree in law from Victoria University of Wellington. He is admitted as a Barrister and Solicitor of the High Court of New Zealand. Mr. Edwin A. Vanderbruggen has 17 years experience as a tax lawyer and academic. He advises multinational enterprises, governmental departments and international organizations in the field of international taxation, tax planning and on the public international law of trade & investment. Besides extensive tax consulting work for multinational enterprises he has regularly trained and assisted tax department officials in various countries, designed policy and drafted tax laws and regulations and has supplied expert testimony to tax courts. He has also trained and advised governmental agencies on international trade/ investment law and arbitration. Knowledge that works www.irvingseminar.com Registration Please register the following delegate (s) for the conference on: HOW TO OVERCOME THE COMPLEXITY OF THE FOREIGN CONTRACTOR TAX IN VIETNAM 1) Name: ______________________________ Position: _________________Email: _______________ 2) Name: ______________________________ Position: _________________Email: _______________ 3) Name: ______________________________ Position: _________________Email: _______________ 4) Name: ______________________________ Position: _________________Email: _______________ 5) Name: ______________________________ Position: _________________Email: _______________ Company: Address: City: Zip Code: Country: Tel: Fax: Email: Name & Title of Approving Manager: Signature of Approving Manager: Registration Date __ / __ / __ REGISTRATION FEES ADMINISTRATIVE DETAILS Fee for one delegate including a binder with all presentation material and a CD-Rom, lunch and refreshment METHOD OF PAYMENT: ( ) Bank Transfer to: Irving Seminar and Training Limited DBS Bank (Hong Kong) Multi Currency-Savings Account no. 788-152-957 Hong Kong Swift Code: DHBKHKHH (US 20$ will be charged for the transfer fee 1 Delegate 480 USD 3 EASY WAYS TO REGISTER OR ENQUIRE FOR NORMAL REGISTRATION Phone Tel TH: +66 (0) 2 651 2703 Tel VN: +84 (0) 902 501 577 In order to avoid any inconvenient circumstances to delegates at the conference, payment should reach us 5 days after the registration form is submitted or 48 hours prior to the event in case of last minute registration. For booking arrangements at the venue, cancellations can only be accepted until 5 working days before the day of the seminar. In that case we will provide a voucher. If you cannot attend the seminar without a valid cancellation we will send you the documentation by mail. E-Mail: [email protected] www.irvingseminar.com or visit our website at IRVING SEMINAR and TRAINING LTD. Unit 2503, Insurance Group Building, 141 Des Voeux Road Central, Hong Kong CONFERENCE DATE Ho Chi Minh City, Thursday 7 July 2011 09 :00 - 17:30 REQUIRIES Please contact our conference administrator at email: [email protected] If you need more information about the conference Knowledge that works INCORRECT MAIL INFORMATION It is possible that you will receive multiple mailings of this event or incorrect company details on the labels, for which we apologize. If this happens, please let us know so that we can update our database immediately. 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