According to Decree No. 320/2025/ND-CP (effective from December 15, 2025), there are significant adjustments regarding the determination of deductible expenses for Corporate Income Tax (CIT) purposes, particularly concerning the non-cash payment threshold.
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1. General Conditions for Determining Deductible Expenses
To be recognized as a deductible expense when determining CIT taxable income, an enterprise must simultaneously satisfy three prerequisite conditions:
- Actual Incurrence: The expense must directly relate to the enterprise’s production and business activities or other duties as prescribed by law.
- Supporting Documents: Sufficient legitimate invoices and supporting documents must be maintained.
- Payment Method: For transactions involving the purchase of goods, services, and other payments with a value of VND 5 million or more per occurrence, the enterprise must possess non-cash payment vouchers.
2. Mandatory Regulations for Salary and Wage Expenses
At the 2025 Dialogue Conference between the Ministry of Finance and Taxpayers, the Tax Department emphasized the application of non-cash payment regulations for labor costs as follows:
- Scope of Application: Salary and wage payments to employees are subject to the non-cash payment threshold regulations under Decree No. 320/2025/ND-CP.
- Value Threshold: In cases where salary or wage payments to an employee amount to VND 5 million or more per occurrence, if the enterprise uses cash or payments in-kind, the entire amount of such expense will be deemed non-deductible.
- Compliance Requirement: Enterprises must conduct payments via non-cash methods in accordance with Value Added Tax (VAT) regulations to ensure the eligibility to CIT deduction.
