PACKAGE PAYMENTS FOR STATIONERY, WORKING-TRIP EXPENSES, TELEPHONE, CLOTHES

PACKAGE PAYMENTS FOR STATIONERY, WORKING-TRIP EXPENSES, TELEPHONE, CLOTHES

Package payments for stationery, working-trip expenses, telephone are not calculated as taxable income according to point đ.4, clause 2, article 2 of circular 111/2013/TT-BTC dated August 15, 2013.

Package payments for stationery, working-trip expenses, telephone, clothes, etc., which are higher than the levels prescribed by current regulations of the State. These package payments are not calculated as taxable income in the following cases:

- For cadres, civil servants and employees working in administrative and non-business agencies, Party agencies, mass organizations, societies and associations: The package payment levels comply with written guidance of the Ministry of Finance.

- For employees of business organizations and representative offices: The package payment levels comply with the levels for determination of enterprise income tax-liable income specified in documents guiding the Law on Enterprise Income Tax.

- For employees of international organizations and representative offices of foreign organizations: The package payment levels comply with regulations of such international organizations and representative offices.

Regulations guiding the implementation of the Corporate income tax

1. Package payment for working-trip expenses

According article 4 of circular 96/2015/TT-BTC dated June 22, 2015 guiding deductible expenses when calculating taxable income.

"...Allowance for employees on business trips, allowance for travelling and accommodation of employees on business trips will be deductible expenses when calculating taxable income if they have adequate invoices. If the enterprise pays for the traveling, accommodation, and allowance of employees on business trips in accordance with its financial regulations or rules, such amounts will be deductible.

..."

According the regulations above: package payment of working-trip expenses in accordance with its financial regulations or rules:

- Corporate income tax: package payment for working-trip expenses in accordance the company's regulations will be deductible expenses when calculating taxable income.

- Personal income tax: package payment of working-trip expenses in accordance of the company's regulations.

   => If the package payment is within the levels of the company's regulations then it is not calculated as taxable income.

   => If the package payment is higher than the levels of the company's regulations then the excess is subject to calculated as taxable income.

2. Package payments for telephone, stationery

According article 4 of circular 96/2015/TT-BTC dated June 22, 2015 guiding deductible expenses when calculating taxable income.

"... Wages, bonuses for employees that are not specified about eligibility conditions and benefit levels in one of the following documents: employment contract, collective bargaining agreement, financial regulation of the company, general company, corporation; reward scheme issue by the President of the Board of Directors, General Director or Director in accordance with the financial regulation of the company or general company.

..."

According the regulations above, package payment for telephone, stationery are specified about eligibility conditions and benefit levels in employment contract or financial regulation of the company.

- Corporate income tax: it is considered a salary expenses and will be deductible expenses when calculating taxable income.

- Personal income tax: package payment for telephone, stationery in accordance of the company's regulation.

  => If the package payment is within the levels of the company's regulations then it is not calculated as taxable income.

    => If the package payment is higher than the levels of the company's regulations then the excess is subject to calculated as taxable income.

Note: Currently, There is no regulation the maximum and minimum of package payment for working-trip expenses, telephone, stationery. Enterprises base on the actual situation to make appropriate and reasonable regulations and rules.

3. Package payment for clothes

According article 4 of circular 96/2015/TT-BTC dated June 22, 2015 guiding deductible expenses when calculating taxable income.

"... In-kind expenditure on employees' clothing without invoices. Monetary expenditure on employees' clothing that exceeds VND 5 million/person/year.

..."

According the regulations above, monetary expenditure on employees' clothing that does not exceed VND 5 million/person/year.

- Corporate income tax: will be deductible expenses when calculating taxable income.

- Personal income tax: monetary expenditure on employees' clothing is limited and not exceed VND 5 million/person/year.

   => If monetary payment must not exceed VND 5 million/person/year then it is not calculated as taxable income.

   => If monetary payment exceed VND 5 million/person/year then the excess is subject to calculated as taxable income.