Set up a software company in Vietnam

In the context of strong digital transformation, the software industry has become one of the fields with top development potential in Vietnam. Establishing a software company not only opens up attractive business opportunities but also contributes to promoting technology application in all areas of life. However, for a software enterprise to be established and operate legally, individuals and organizations need to fully meet the conditions according to the provisions of law. In the article below, Viet An Law will provide you with legal issues revolving around the conditions for setting up a software company in Vietnam.

What is a software product? Types of software products

Based on Clause 1, Article 3 of Decree 71/2007/ND-CP, a software product is software and accompanying documentation produced and displayed or stored in any physical form, which can be bought, sold, or transferred to other subjects for exploitation and use.

Software industry activity is the activity of designing, producing, and supplying software products and services, including the production of packaged software; production of software to order; production of embedded software; software outsourcing activities; and activities of providing and performing software services.

Types of software products include:

• System software.
• Application software.
• Utility software.
• Tool software.
• Other software.

Market access conditions for foreign investors

Market access conditions for foreign investors

For software services, Vietnam has made commitments in the Schedule of Specific Commitments in Services in the WTO under CPC codes 841 – 845 and CPC 849 (Computer and related services).

Accordingly, for cross-border supply and consumption abroad modes, this service is not restricted in Vietnam.

For the commercial presence mode, conditions include:

• Within 2 years from the date of WTO accession, 100% foreign-invested enterprises are only allowed to provide services to foreign-invested enterprises in Vietnam.
• After 2009, foreign persons are allowed to establish branches, and the head of the branch must be a permanent resident in Vietnam.

Regarding investment forms, foreign investors can proceed to establish a company with foreign investment capital under 2 forms:

• Direct investment: Foreign investors establish a company with foreign capital, with no limit on the percentage of capital. This form must meet the conditions in Article 22 of the Law on Investment 2020.
• Indirect investment: Foreign investors invest in the form of capital contribution, purchase of shares, or purchase of capital contributions in an economic organization trading in software services. Conditions for foreign investors to establish an enterprise under this form are prescribed in Clause 2, Article 24 of the Law on Investment 2020.

Conditions for establishing a software company for Vietnamese capital

Conditions for establishing a software company for Vietnamese capital

Conditions for establishing a company

In general, software production and business is not a conditional business line. Therefore, the process of establishing a software company is not too complicated; it is only necessary to meet the conditions for business registration.

Conditions on registering suitable business lines

Enterprises must register business lines suitable for the software field. Some business line codes that can be registered include:

• Code 4651: Wholesale of computers, peripheral equipment and software.
• Code 5829: Other software publishing.
• Code 6211: Development of video games, video game software and video game software tools.
• Code 6219: Other computer programming.
• Code 6220: Computer consultancy and computer facilities management activities.
• Code 6290: Other computer service and information technology activities.
• Code 6310: Data processing, hosting and related activities.
• Code 6390: Other information service activities (Web portals).

If trading in business lines related to software for camouflage, recording, positioning, or video recording equipment, the enterprise needs to apply for a license for satisfaction of security and order conditions to be allowed to operate.

Conditions on company name

• The company name must ensure at least two components: Type of enterprise and Proper name of the company.
• The company name can be in Vietnamese or a foreign language. If the name is in a foreign language, the name sign must be printed smaller than the Vietnamese name at the headquarters, branches, business locations, and on transaction papers, documents, and publications issued by the company.
• The company name must not be identical or confusingly similar to companies already registered on the national business registration portal.

Conditions on business operation address

• The enterprise must have a legal business operation address. This means having a valid certificate of ownership or land use rights, or a valid land/office lease contract according to regulations.
• The company address must be located within the territory of Vietnam, with clear and accurate house number, alley, district, city, etc.
• Do not use a fake address as the address for the software company.

Conditions on business owners

The business owner must ensure full civil capacity, health, and be a legal citizen, not falling into the subjects restricted from establishing a software enterprise.

Conditions on tax conditions

Corporate Income Tax (CIT)

Enterprises producing software enjoy corporate income tax incentives with the following roadmap:

• From year 1 to year 4: Exempt from corporate income tax.
• From year 5 to year 13 (next 9 years): 50% reduction of CIT at the tax rate of 10% (Pay 5%).
• From year 14 to year 15 (tax rate of 10% for 15 years): Tax rate of 10%.
• From year 16 onwards: Pay normal CIT.
• Note: Enterprises trading (buying and selling) software are not entitled to the above corporate income tax incentives.

Value Added Tax (VAT) Computer software, including software products and software services according to the law, is a non-taxable object for VAT. Therefore, software enterprises do not have to pay this tax.

Software company establishment registration dossier

Based on Articles 19, 20, 21, and 22 of the Enterprise Law 2020, amending and supplementing the Enterprise Law 2025, No. 76/2025/QH15.

The enterprise prepares a full enterprise registration dossier including:

• Application for enterprise registration (Depending on the type of enterprise, there will be different forms).
• Company Charter.
• List of members for Limited Liability Companies or Partnerships; List of founding shareholders and list of shareholders being foreign investors for Joint Stock Companies.
• List of beneficial owners of the enterprise (if any).
• Copies of valid personal legal papers.
• Letter of authorization for Viet An Law.

Within a period of 03 working days from the date of receiving a valid dossier, the Competent Authority will issue the Business Registration Certificate to the enterprise.

Note: Some provinces and cities such as Hanoi and Ho Chi Minh City will not issue paper business registration certificates and replace them with electronic versions with digital signatures; other provinces still issue paper versions as before. Enterprises can contact Viet An Law for the fastest and most accurate information updates.

The above is the advice of Viet An Law on the conditions for setting up a software company in Vietnam. Customers wishing for advice on related procedures, please contact Viet An Law Firm for the best support!