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blue-check Conditions for accounting Covid-19 quarantine – related expenses paid for foreign experts

Official letter No. 5032/TCT-CS dated November 26th, 2020 of the General Department of Taxation regarding determination of deductible expenses and personal income tax (PIT) on Covid-19 quarantine - related expenses of foreign experts
Posted: 7/12/2020 9:45:48 AM | Latest updated: 2/8/2022 2:07:26 PM (GMT+7) | LuatVietnam: 5104 | Vietlaw: 487
VietlawOnline

With regard to expenses involved in quarantine at hotels incurred by foreign experts, the General Department of Taxation notes that they shall be only included in deductible expenses if in the labor contracts indicating the agreement on which enterprise shall pay house rents and there are adequate invoices, payment documents.

Particularly, expenses of Covid-19 testing is considered to be welfare expenditures and shall be included in deductible expenses if the expenditures meet the regulations at point 2.30 Clause 2 Article 6 of Circular No. 78/2014/TT-BTCstatus2 (amended at Article 4 of Circular No. 96/2015/TT-BTCstatus2 ).

Expenses involved in quarantine for Covid-19 prevention and control paid by the enterprise on behalf of the foreign experts are considered to be benefits of the foreign experts, they shall be subject to PIT according to point dd.7 Clause 2 Article 2 of Circular No. 111/2013/TT-BTCstatus2 .

With regarding expenditures on purchasing air tickets for foreign experts to make business trips, conditions for accounting of such expenditures shall comply with point 2.9 Clause 2 Article 6 of Circular No. 78/2014/TT-BTCstatus2 (amended at Article 4 of Circular No. 96/2015/TT-BTCstatus2 ).

Notes
Based on Article 1 of Official letter No. 7038/VPCP-KTTH dated August 24th, 2020, if foreign experts wish to undergo medical quarantine at hotels, they have to themselves pay involved expenses such as expenses of meals, accommodation according to prices decided by such hotels. Concurrently, they also have to pay costs of Covid-19 testing according to prices decided by testing agencies.
Ms Phuong Thao (VietlawOnline.com)
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Published Vietlaw's Newsletter No. 487

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