On November 05, 11, the Government issued Decree 2020/132 / ND-CP on tax administration applicable to enterprises with associated transactions.
Accordingly, compared with the provisions of Clause 2, Article 5 of Decree 20/2017 / ND-CP, related parties are allowed to add the following subjects:
- Two businesses are run or controlled by personnel, finance and business operations by individuals in one of the relationships:
+ Step-father, step-mother, father-in-law, father-in-law;
+ Stepchild of husband or wife, daughter-in-law, son-in-law.
- An enterprise that has the following transactions with the person operating and controlling the enterprise or with an individual in a relationship as prescribed at Point g, Clause 2, Article 5 of Decree 132:
+ Transaction of capital transfer or transfer of contributed capital of at least 25% of contributed capital of the enterprise's owner in the tax period;
+ Transaction of borrowing, lending at least 10% of equity of the owner at the time of transaction arising in the tax period.
With this new additional regulation, the number of businesses identified as having an associated transaction will be much more than in the past as the above transactions are quite common.
To learn more about the tax administration regulations for associated businesses and what your business will take in 2020, please read the full article below.