Decree No. 20/2025/ND-CP Amending and Supplementing Decree No. 132/2020/ND-CP for Enterprises with Related Party Transactions

DECREE

Amending and Supplementing a Number of Articles of Decree No. 132/2020/ND-CP dated November 05, 2020 of the Government on Tax Administration for Enterprises with Related Party Transactions

Pursuant to the Law on Organization of the Government dated June 19, 2015; Law on amending and supplementing a number of articles of the Law on Organization of the Government and the Law on Organization of Local Governments dated November 22, 2019;

Pursuant to the Law on Tax Administration dated June 13, 2019;

Pursuant to the Law on Corporate Income Tax dated June 03, 2008; Law on amending and supplementing a number of articles of the Law on Corporate Income Tax dated June 19, 2013;

Pursuant to the Law on Amending and Supplementing a Number of Articles of the Laws on Tax dated November 26, 2014;

Pursuant to the Law on Credit Institutions dated January 18, 2024;

At the proposal of the Minister of Finance;

The Government promulgates this Decree amending and supplementing a number of articles of Decree No. 132/2020/ND-CP dated November 05, 2020, of the Government on tax administration for enterprises with related-party transactions.

Article 1. Amending and Supplementing a Number of Articles of Decree No. 132/2020/ND-CP dated November 05, 2020, of the Government on Tax Administration for Enterprises with Related Party Transactions

1. Amend and supplement point d, point k and supplement point m of clause 2 Article 5 as follows:
2. a) Amend and supplement point d as follows:

“d) An enterprise guarantees or lends capital to another enterprise in any form (including loans from third parties secured by related party financial resources and transactions of a similar nature) provided that the total outstanding debt of the borrowing enterprise to the lending or guaranteeing enterprise is at least equal to 25% of the charter capital of the owner of the borrowing enterprise and accounts for more than 50% of the total outstanding debt of all medium and long-term debts of the borrowing enterprise. The provisions in point d of this clause do not apply to the following cases:

d.1) The guarantor or lender is an economic organization operating under the provisions of the Law on Credit Institutions and does not directly or indirectly manage, control, contribute capital, invest in the borrowing enterprise or the enterprise guaranteed under the provisions of points a, c, d, e, g, h, k, l and m of this clause.

d.2) The guarantor or lender is an economic organization operating under the provisions of the Law on Credit Institutions and the borrowing enterprise or the enterprise being guaranteed is not directly or indirectly subject to the same management, control, capital contribution, investment of another party as prescribed in points b, e and i of this clause.”

1. b) Amend and supplement point k as follows:

“k) Other cases where an enterprise (including branches with independent accounting that declare and pay corporate income tax) is subject to the management, control, and decision-making in practice regarding the production and business activities of another enterprise;”

1. c) Supplement point m as follows:

“m) A credit institution with a subsidiary, or with a controlling company or with an associate of the credit institution under the provisions of the Law on Credit Institutions and the amended, supplemented or replacement documents (if any);”

2. Amend and supplement clause 2 Article 21 as follows:

“2. The State Bank within its tasks and powers is responsible for:

Coordinating the provision of information and data on foreign loans and debt repayments of specific enterprises with related-party transactions based on the list requested by the Tax Authority, including data on loan amounts, interest rates, interest payment periods, principal repayments, actual capital withdrawals, debt repayments (principal, interest) and other related information (if any).

Coordinating the provision of information reported in accordance with the law on related persons of members of the Board of Directors, members of the Board of Members, members of the Supervisory Board, General Director (Director), Deputy General Director (Deputy Director) and equivalent titles as prescribed in the Charter of the credit institution; persons related to shareholders holding 01% or more of the charter capital of the credit institution; associates of the credit institution according to the management data information system of the State Bank when requested by the tax authority.”

Article 2. Replacing Appendix I – Information on Related Party Relationships and Transactions issued together with Decree No. 132/2020/ND-CP dated November 05, 2020 of the Government stipulating on tax administration for enterprises with related party transactions with Appendix I issued together with this Decree.

Article 3. Transitional provisions In the case that, in the corporate income tax period of 2020, 2021, 2022 and 2023, the borrowing enterprise only has a related relationship with the economic organization operating under the provisions of the Law on Credit Institutions specified in point d, clause 2, Article 5 of Decree No. 132/2020/ND-CP and the borrowing enterprise with the lender or guarantor is in the case specified in points d.1 and d.2, clause 2, Article 5 of Decree No. 132/2020/ND-CP, amended and supplemented in Article 1 of this Decree, has a related-party transaction within the scope of regulation in clause 2, Article 1 of Decree No. 132/2020/ND-CP and has interest expenses that are not deductible under the provisions of point a, clause 3, Article 16 of Decree No. 132/2020/ND-CP, then from the tax period of 2024, the following shall be implemented:

In the case that the enterprise does not have related-party transactions and does not generate related-party transactions under the provisions of Decree No. 132/2020/ND-CP and this Decree, the portion of interest expenses that is not deductible and has not been carried forward to subsequent tax periods up to the end of the tax period in 2023 shall be allocated equally and carried forward to subsequent tax periods for the remaining period according to the regulations on the period for carrying forward interest expenses at point b, clause 3, Article 16 of Decree No. 132/2020/ND-CP.

In the case that the enterprise has related-party transactions and generates related-party transactions under the provisions of Decree No. 132/2020/ND-CP and this Decree, the interest expenses that are not deductible and have not been carried forward to subsequent tax periods shall be implemented according to the provisions at point b, clause 3, Article 16 of Decree No. 132/2020/ND-CP.

Article 4. Organization of Implementation and Effectiveness

1. This Decree takes effect from March 27, 2025, and applies from the corporate income tax period of 2024.
2. Ministers, Heads of ministerial-level agencies, Heads of agencies attached to the Government, Chairmen/Chairwomen of People’s Committees of provinces and centrally-run cities and relevant organizations and individuals shall be responsible for the implementation of this Decree.

Download file: Decree 20/2025/ND-CP