Question 1

What is Foreign Contractor Tax (FCT - Thuế Nha Thầu) in Vietnam under Circular 103/2014/TT-BTC?

Accepted Answer

FCT applies to foreign organizations and individuals doing business in Vietnam or earning income from contracts with Vietnamese entities, comprising VAT and CIT components.

Question 2

What are the deemed FCT tax rates for services and goods supplied in Vietnam?

Accepted Answer

Deemed rates on gross revenue: Construction/services (5% VAT + 5% CIT); Goods supplied with installation services (3% VAT + 1% CIT); Software licensing (exempt VAT + 10% CIT).

Question 3

What is the difference between Net and Gross contract terms for FCT?

Accepted Answer

Under Net contracts, the Vietnamese party absorbs the FCT tax cost and grosses up the contract value. Under Gross contracts, FCT is deducted from the remittance to the foreign contractor.

Question 4

How do Double Tax Treaties (DTT) affect Foreign Contractor Tax in Vietnam?

Accepted Answer

A foreign contractor may claim exemption from the CIT portion of FCT if they qualify under a valid DTT and do not have a permanent establishment in Vietnam.

Question 5

When must the Vietnamese contracting party withhold and remit FCT to the tax department?

Accepted Answer

The Vietnamese party must declare and remit withheld FCT within 10 days of making payment to the foreign contractor or on a monthly/quarterly schedule.

Vietnam Foreign Contractor Tax (FCT) Calculator

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📊 Bảng Tra Cứu Quy Chuẩn Phap Lý Việt Nam (Thuế, BHXH & Lao Động)

Engr. Muhammad Shahzad