Establish a company in Vietnam

Establishing a company is the initial procedure for entrepreneurs to step into the market. Accordingly, for a company to come into existence, it is necessary to follow the procedures for obtaining a Enteprise Registration Certificate and comply with relevant legal and accounting procedures. With nearly 20 years of experience in providing legal advice for business entities and commercial operations, along with a team of lawyers, tax experts, and certified accountants possessing in-depth knowledge and extensive experience, Viet An Law Firm has assisted thousands of aspiring entrepreneurs in establishing enterprises each year. We take pride in being the most professional law firm providing company establishment services with the most reasonable costs and the shortest processing time in all 63 provinces and municipalities throughout the country.

Why is it necessary to engage a reputable law firm to assist with company formation procedures?

Businesses strive to find a reputable law firm to support them in establishing their companies for the following reasons:

• A reputable law firm provides comprehensive advice on all issues arising during the establishment and operation of a business, going beyond the mere assistance in obtaining business licenses and registering with the company.
• A reputable law firm, with experienced and specialized lawyers, along with a team of certified accounting consultants, provides valuable guidance to businesses regarding post-company formation tasks and ongoing operations. This ensures that the business does not encounter difficulties, including potential violations resulting from the failure to fulfill obligations as stipulated. In worse cases, businesses may face suspension of their Enteprise Registration numbers by regulatory authorities or tax penalties due to non-compliance, sometimes due to their lack of understanding of the regulations.
• When businesses select a reputable law firm specializing in business advisory and related legal services, fees are always transparent and specified in the legal service contract. Consequently, there are no additional hidden fees (sometimes intentionally divided) to lure customers. For example, an advertised package price of 500,000 VND for comprehensive company formation does not include statutory fees, stamp fees, publication fees, or other expenses. Businesses end up paying significantly more than initially expected.
• By using the services of a reputable law firm, customers also receive free assistance in various other business-related areas and legal scenarios, ensuring maximum protection of their rights and interests.
• When establishing a company through a reputable law firm, businesses receive professional services in accordance with the advisory contract, with reasonable and often more cost-effective fees compared to consulting firms without legal expertise.
• Entrepreneurs in need of company formation should not hesitate to contact Viet An Law Firm for comprehensive advice and support throughout the company establishment process.

When should a company be established?

If businesses have activities related to the following, it is advisable to establish a company:

• There is a demand from many customers for VAT invoices for their business transactions, allowing for an input tax deduction.
• Partners, suppliers, and customers require contracts to be signed with a legal entity.
• Clear and formal accounting of business operations is necessary to ensure compliance and profitability according to regulations.

In practice, establishing a company is more advantageous for the company owner compared to other forms of business entities due to its clarity. Especially when the company is not yet profitable, it is exempt from certain taxes (except for the business license fee from the second year onwards), and value-added tax (VAT) is collected and remitted in place of the authority. The company has the right to carry forward losses continuously for up to five years. The most challenging aspect of a company is tax declaration and reporting. However, with our tax and accounting services available at a modest cost, companies can confidently manage their tax reporting activities (without the need to hire independent accountants who may lack experience and incur unnecessary expenses).

Requirements for Company Establishment

The requirements for establishing a company are relatively straightforward:

• Being at least 18 years old.
• Not being prohibited from establishing a business entity.

It is noted that you can establish a company in any province or municipality without restrictions on registering residency or permanent address.

Except for certain special cases, the law does not limit the number of companies an individual can establish. Therefore, if you are ready to embark on entrepreneurship, do not hesitate to contact Viet An Law Firm for support and advice further solution.

Required Documents for Company Establishment

Frequently asked questions from our clients regarding company formation revolve around the necessary documents and information. According to the provisions of Vietnamese Law on Enterprises 2020 and Decree No. 01/2021/ND-CP on Enteprise Registration, the following information and documents need to be prepared to apply for a enterprise registration certificate:

• Notarized copies of the national identification card, citizen identification card, or valid passport of the company’s founding members, shareholders, and legal representatives (in the case of a legal representative who is hired and not a shareholder or member of the company).
• Relevant information regarding the company’s name, address, capital, business sectors, etc. This information will enable Viet An Law Firm to provide specific advice and draft the necessary documents on behalf of our clients for the company formation process.
• The most important documents are copies of the national identification card/citizen identification card/passport of the company’s members, founding shareholders, and legal representative.
• Documents related to the company’s head office, such as lease contracts, loan agreements, or ownership rights of the premises owned by the business owner, or other legally valid documents equivalent to the right to use land, buildings, or offices for rent (These documents are to be kept at the company for inspection purposes during the operation and are not required to be submitted during the company formation process).

Based on the information provided by our clients, Viet An Law Firm will provide detailed advice and comprehensive support for all the necessary procedures for company formation, as well as guidance on post-incorporation procedures and fulfillment of conditions for conducting business activities in accordance with the regulations.

For further information, kindly refer to article: Establishing a company in Vietnam – Detailed procedures of Viet An Law or contact us as below information.

Comparison of Common Types of Companies

In order for our esteemed clients to make an decision on the appropriate type of company, Viet An Law Firm has prepared a comparison chart of the main types of companies commonly established in practice. This will assist aspiring entrepreneurs in selecting the most suitable option for their endeavors.

Procedures for establishing a company

For the foreign investors, the initial step to set up a bussiness in Vietnam is obtaining Investment Registration Certificate. Kindly refer to the attached link of our website to further understanding.

In order to successfully establish a company and ensure compliance with legal requirements, the procedures for establishing a company should be carried out in the following steps:

• Step 1: Preparation of company establishment documents
• Step 2: Submission of company establishment documents and payment of enteprise information disclosure fees
• Step 3: Enteprise Registration Certificate Issuance
• Step 4: Company Seal Engraving (Circular seal)
• Step 5: Completion of service delivery and guidance on post-company establishment procedures for Customers
• Step 6: Support and consultation on legal matters related to company operations and tax declaration as requested by customers
• Step 7: Application for operational licenses for the company

For detailed procedure and some key considerations when establishing a company in Vietnam, kindly refer to article: Establishing a company in Vietnam – Detailed procedures of Viet An Law.

Types of basic taxes that a company required to pay in Vietnam

• License fee (based on registered capital): Registered capital below 10 billion VND, business shall pay 2 million VND per year. While registered capital of 10 billion VND, above license fee will increase to 3 million VND per year.
• Value Added Tax (based on the company’s output and input balance).
• Corporate Income Tax (payable only when the company makes a profit, at a rate of 20% of the company’s profit).
• Export and Import Taxes (if engaged in import and export activities).
• Natural Resource Tax (if using natural resources).
• Special Consumption Tax (if engaged in restricted business sectors).

To more detail on this topic, please refer to the article: Types of basic taxes that a company required to pay in Vietnam of Viet An Law.

Procedures after company establishment

What should businesses do after receiving their Enteprise Registration Certification? The procedures to be carried out and the deadlines to comply with, as stipulated in the Law on Enterprises 2020, after obtaining Enteprise Registration Certification are as follows:

• Opening a company bank account
• Registering a digital signature for electronic tax filing and online tax reporting
• Declaration and payment of business license fee
• Creating signage and displaying company signage at the head office
• Obtaining an electronic signature for electronic tax filing
• Requesting the issuance of electronic invoices

Starting from the initial advisory steps and obtaining the Enteprise Registration Certificate, to tax-related matters and accounting, businesses can make use of the relevant services provided by Viet An Law Firm.

For your information, please refer to the article: Things enterprises have to do after establishing in Vietnam of Viet An Law.

The reasons why customers should choose to use the business establishment/service of Viet An Law Firm are as follows

Viet An Law Firm was established in 2007 and has since established companies and provided legal advice to tens of thousands of domestic and international clients. The range of advisory services offered by Viet An Law Firm is diverse and always prioritizes the interests of clients. For nearly 20 years, Viet An Law Firm has been chosen by numerous customers due to its reputable services that align with our guiding principle: “Find Viet An Law. Find Answers.”

Types of companies commonly established by Viet An Law Firm for clients:

– Sole proprietorship

– Private enterprise

– Single-member Limited Liability Company

– Multiple member Limited Liability Company

– Joint Stock Company (JSC)

– Partnership

– Foreign-invested companies

– Offshore companies

– State-owned company establishment

– Joint venture

Top 10 provinces and cities with the largest number of established companies:

– Establishing companies in Hanoi

– Establishing companies in Ho Chi Minh City

– Establishing companies in Da Nang

– Establishing companies in Binh Duong

– Establishing companies in Dak Lak

– Establishing companies in Thua Thien Hue

– Establishing companies in Nam Dinh

– Establishing companies in Ha Nam

– Establishing companies in Bac Ninh

– Establishing companies in Bac Giang

Frequently asked questions when going through the company establishment procedures:

Viet An Law Firm receives many questions related to business establishment. Below are the commonly asked questions during the process of legal consultancy for business:

Is it possible to choose the display date on the Enteprise Registration?

Companies can choose the submission date to display as the registration date on the Enteprise Registration Certificate. However, this date cannot fall on holidays or weekends. The selection of the date is not 100% accurate and carries certain risks. If you wish to choose a specific date, you can contact Viet An Law Firm for the best advice and support.

Where do establishment company dossiers submit?

If establishing an individual business household, Clients can submit at the People’s Committee of the District where the business household is located. When establishing a company, you submit it at the Enterprise Registration Office – Department of Planning and Investment where its head office located.

Does establishing a company require permanent residence?

The establishment of a company is not based on the permanent residence of the founder, but the start-up can establish a company in any province as demand.

How much capital is required to establish a company?

• According to the current Enterprise Law provisions, the determination of capital amount is at the discretion of the enterprise. The enterprise is responsible for declaring and bearing the liability for the charter capital of the company.
• Certain industries that have prescribed capital requirements must register the capital amount according to legal regulations. However, there is no need to prove the source of capital. It is sufficient to ensure responsibility for the declared capital and have enough capital reserved as required by specific industries.

Can an apartment building be registered as the company’s head office?

According to current legal provisions, apartment buildings and collective housing are not eligible to be registered as the company’s head office, as well as the address of its branches, representative offices, or business locations of the company.

Basic taxes that must be declared and paid after the establishment of a company are as follows:

• Fixed capital-based business license fee (companies established in 2023 are exempt from this tax).
• VAT (usually 10%), which is only applicable if the company generates output exceeding input.
• Corporate Income Tax: typically 20% of profits, payable only if the company is profitable.

If a company has no revenue or expenses, does it still need to declare and pay taxes?

After the establishment of a company, if there is no revenue or expenses, the company is not required to pay taxes (except for the business license fee in subsequent years). However, on a quarterly basis, the company still needs to declare taxes as follows:

• For VAT declaration: Even if the company has no input and output invoices, it still needs to submit the VAT declaration on time.
• For reporting the use of invoices: The company still needs to declare even if it has not issued any VAT invoices (if the company has completed the procedures for invoice issuance notification).
• For year-end fiscal report: The company should note that even if there is no business activity, it still needs to prepare and submit year-end financial reports for the operating year.

The result of Viet An service on company establishment procedure

The results that customers receive when using the company establishment services of Viet An Law Firm are based on the contractual service packages. Therefore, each customer’s outcomes depend on the agreed-upon tasks between both parties. The following are typical results that customers usually obtain after utilizing the company establishment services at Viet An Law Firm:

• Enteprise Registration Certificate, which also serves as the tax identification number.
• Company seal.
• Internal corporate documents.
• Company charter.
• Guidance on post-establishment procedures, such as opening bank accounts, invoice printing, and advice on registering digital signatures for online tax submission.
• Consultation on tax declaration procedures, tax filing, tax payment, and social insurance contributions.
• Post-establishment services, including assistance with bank accounts, tax profile setup, tax method registration, initial tax declaration, and VAT invoice printing.
• Support for tax declaration throughout the company’s operation.
• Comprehensive tax accounting services.
• Website development consultation, logo and trademark, licensing, and ensuring business operations comply with legal requirements after company establishment.

If you have any questions or concerns about these legal matters or any other issues related to the sequence of procedures and steps required company establishment, please don’t hesitate to contact Viet An Law Firm at the following phone number: (+84) 9 61 67 55 66 or email: info@luatvietan.vn