Decree No. 132/2020/ND-CP dated November 5th, 2020 of the Government on prescribing tax administration for enterprises having related-party transactions

Under this Decree, the maximum limit on loan interest costs is still remained unchanged at 30% as that regulated at Decree No. 68/2020/ND-CP .

Regarding the concept of “related-party transaction”, in addition to the definitions at Decree No. 20/2017/ND-CP , there is a new definition in this Decree. Accordingly, if an enterprise performs the disposition or acquisition transaction in at least 25% of its equity or lends at least 10% of its equity to a person that is controlling the enterprise, the transaction is also considered to be a related-party transaction.

Enterprises engaged in related party transactions under this Decree shall be responsible for declaring information about their interrelationships or intra-group relationships and related party transactions by using the Forms given in Appendix I, II and III to this Decree, and submitting their completed forms together with the corporate income tax finalization returns.

This Decree shall enter into force on December 20, 2020 and take effect from the corporate income tax term of 2020.

To replace Decree No. 20/2017/ND-CP dated February 24, 2017 and Decree No. 68/2020/ND-CP dated June 24, 2020.