After successfully registering a business, the company needs to complete several necessary procedures to officially begin operations. Expertis provides business owners with a list of the latest legal tasks to be done after establishing a new business.
1. Engraving a stamp
Businesses have the right to decide on the type, quantity, form, and content of the seals for the business, its branches, representative offices, and other units.
Businesses choose a legally licensed seal engraving service and have their seal engraved. Upon completion, the seal engraving service will provide a Seal Engraving Confirmation Certificate.
Remember to keep the Seal Confirmation Certificate to present to the bank where you opened your account upon request.
2. Opening a bank account
After receiving the Business Registration Certificate, the business needs to contact commercial banks or branches of foreign banks in Vietnam to open a payment account for the business.
Within 10 days of opening a bank account, the business must notify the Business Registration Office – Department of Planning and Investment that issued the Business Registration Certificate. (According to the streamlined one-stop process, bank accounts no longer need to be notified to the directly managing tax authority.)
From May 1st, 2021, bank account information will no longer be submitted to the Department of Planning and Investment; instead, procedures will follow the guidance of the Tax Authority.
For businesses with foreign capital, whether through direct or indirect foreign investment, or the transfer of capital to foreigners, opening a bank account is governed by specific regulations and is of significant importance, impacting the entire investment process. EXPERTIS will provide detailed support for this procedure.
3. Display the business sign.
Signs can be made in horizontal or vertical format, with the following size limitations:
- For horizontal signs, the maximum height is 02 meters (m), and the length must not exceed the width of the building's facade;
- For vertical signs, the maximum width is 01 meter (m), and the maximum height is 04 meters (m), but it must not exceed the height of the building floor where the sign is placed.
Signs must not obstruct emergency exits or fire escapes; they must not encroach on sidewalks or roadways, or affect public traffic.
Businesses need to pay attention to this point: not displaying the company name at the head office, branches, or representative offices is a minor offense but carries a heavy penalty: Failure to display the company name at the head office, branches, or representative offices will result in a fine of 10-15 million VND.
See more: Important information and regulations regarding company signage.
4. Filing and submitting initial tax returns.
Currently, under the one-stop shop system, businesses only need to provide initial tax registration information in the business establishment registration form at the Business Registration Office - Department of Planning and Investment; businesses are issued a tax identification number at the time of business registration.
Within 30 days of receiving the Business Registration Certificate, in order to complete the initial tax registration procedures, the business must contact the direct tax authority to make the following initial tax declarations:
4.1. Business License Tax Declaration
a. Exemption from business license fees in the first year of establishment or commencement of production and business activities.
From February 25, 2020, newly established businesses (issued with a new tax code and new business registration number) are exempt from business license fees for the first year of establishment (from January 1 to December 31). During the exemption period, if a business establishes branches, representative offices, or business locations (hereinafter referred to as Subsidiary Units), these subsidiary units are also exempt from business license fees for the same period that the business is exempt.
However, newly established businesses are still responsible for declaring business license fees to the directly managing Tax Office. (Submit the declaration form with a payment amount of 0 VND).
In cases where a business has subsidiary units operating in different provinces, those subsidiary units must declare and pay business license fees directly to the Tax Department managing them.
b. Deadline for filing business license tax returns
Businesses and their subsidiaries declare business license fees once when they first start operating, no later than the last day of the month in which they begin production and business activities. In the case of newly established businesses that have not yet started production and business activities, they must declare business license fees within 30 days from the date of issuance of the Business Registration Certificate or the Business Operation Registration Certificate.
c. The business license tax rates for subsequent years are as follows:
- Organizations with registered capital or investment capital Over 10 billion VND: 3.000.000 VND/year;
- Organizations with registered capital or investment capital For revenue of 10 billion VND or less: 2.000.000 VND/year;
- Branches, business locations: 1.000.000 VND / year.
- The representative office engages in production and business activities: 1.000.000 VND / year.
4.2. Appointment of Chief Accountant, Person in Charge of Accounting
At this point, the business director needs to decide how to organize their accounting department. Accounting regulations require businesses to appoint a Chief Accountant to be in charge of accounting.
Businesses need to issue a decision appointing an accountant and submit it to the relevant tax authority.
4.3. Registering the VAT declaration method
There are two methods for calculating value-added tax (hereinafter referred to as VAT), namely:
- The direct calculation method includes: calculating by multiplying a percentage of revenue and calculating by multiplying VAT by the VAT rate (only applicable to the purchase, sale, and processing of gold, silver, and precious stones).
- Tax deduction method.
Newly established businesses are subject to the direct method of calculation, which is a percentage multiplied by revenue.
However, businesses may voluntarily apply the tax deduction method in the following cases:
+ Newly established businesses resulting from investment projects of existing businesses pay value-added tax using the deduction method.
+ Newly established businesses that make investments, purchases, or receive capital contributions in the form of fixed assets, machinery, equipment, tools, or have a lease agreement for business premises.
5. Purchase an electronic digital signature.
Digital signatures are one of the important electronic tools in today's digital age, primarily used for electronically submitting declarations, tax returns, and tax payments.
Businesses must choose and purchase digital signatures to carry out tax declaration and payment procedures.
6. Process the invoice issuance.
From November 1st, 2020, businesses, economic organizations, other organizations, households, and individual business owners must register to use electronic invoices.
To issue electronic invoices, businesses must follow these steps:
- Choose a provider of electronic invoices.
- Digital signature.
- Implement administrative procedures for issuing electronic invoices in accordance with regulations.
7. Establish a register of members and shareholders.
Businesses must establish a register of members for limited liability companies with two members, and a register of shareholders for joint-stock companies, immediately after receiving the business registration certificate and store it at the company's head office.
8. Complete the initial employment procedures.
8.1. Establish a Labor Management Register
Within 30 days of commencing operations, businesses must establish a Labor Management Register at their headquarters, branches, and representative offices.
Businesses are responsible for recording and entering complete information about employees when the employment contract is in effect and updating the information in the Labor Management Register whenever there are changes.
8.2. Notification regarding the number of employees working at the newly established enterprise.
Within 30 days of its establishment, the enterprise is responsible for submitting the Initial Notification of the Number of Employees Working at the Unit (Form No. 28 issued with Circular 28/2015/TT-BLDTBXH) to the Employment Service Center where the enterprise is located.
9. Complete the procedures when hiring workers.
9.1. Developing Salary Scales and Salary Tables
Businesses must establish their own salary scales and wage tables. This serves as the basis for recruitment, employment, negotiating salary levels in labor contracts, and paying wages to employees.
Businesses must base their salary levels for each job title, position, and job group on the current regional minimum wage, ensuring compliance with legal principles.
9.2. Developing Labor Regulations
Businesses employing 10 or more workers must have written labor regulations.
Within 10 days of issuing the Labor Regulations, the enterprise must submit one set of registration documents for the Labor Regulations to the Department of Labor, War Invalids and Social Affairs (hereinafter referred to as the Department of LIS) where the enterprise is headquartered.
9.3. Establishing a Trade Union
When workers wish to establish a trade union within an enterprise (hereinafter referred to as the Trade Union), they must first organize a Steering Committee for the establishment of the Trade Union within the enterprise (hereinafter referred to as the Steering Committee) and should contact the nearest higher-level trade union for guidance, assistance, and support in establishing the Trade Union.
The conditions for establishing a trade union are that there must be at least 05 members of the Vietnam Trade Union; or, at least 05 workers must submit voluntary applications to join the Vietnam Trade Union.
10. Complete capital contribution.
10.1. Capital contribution to Vietnamese enterprises
For types of companies such as limited liability companies and joint-stock companies, members and shareholders must fulfill their capital contribution commitments within the stipulated period of 90 days from the date of issuance of the business registration certificate.
In case of any changes regarding capital contributions and the deadline for capital contribution commitments, the enterprise must follow the procedures for adjusting and reducing its charter capital as prescribed.
10.2. Capital contribution to enterprises with foreign investment.
Foreign-invested enterprises must contribute capital within the timeframe committed in their Investment Registration Certificate. Violating this timeframe can lead to several problems, such as:
- After the capital contribution commitment date, even if the capital contribution is transferred to the bank, it will not be recorded and must be returned to the foreign country.
- It is no longer possible to contribute capital, and procedures for adjusting the Investment Certificate must be carried out, resulting in penalties for violating the capital contribution deadline and business interruption.
Organizations and individuals contributing capital must contribute to the correct entity; they are not allowed to contribute on behalf of or through another entity.
The contributed capital must be transferred to a legally opened direct investment capital account at a bank authorized to open investment accounts.
11. Complete the necessary procedures if your business is in a conditional industry.
For industries and business activities subject to conditional investment, investors must meet the investment and business conditions as prescribed by law.
Investment and business conditions are the conditions that individuals and organizations must meet when carrying out investment and business activities in industries or professions subject to conditional investment and business regulations.