Official letter No. 4445/TCT-DNL dated November 12th, 2018 of the General Department of Taxation regarding value – added tax (VAT) upon transfer of activities of the retail banking business
According to the General Department of Taxation’s opinions, the transfer of activities of the retail banking business is not the activity of capital transfer and therefore it shall not be exempt from VAT according to point d Clause 8 Article 4 of Circular No. 219/2013/TT-BTC . read more
However, taking the particularity of this transaction into account, it is not the activities of goods sale and purchase, service provision, thus it is required to consider factors constituting the actual situation under the contract in order to apply VAT. In particular:
- Assets and capital sources directly related to credit provision services shall not be subject to VAT.
- Fixed assets, tool, office repair costs, prepaid office rents which the bank can record separately on the financial statement after the transfer are not directly related to the activity of credit provision, they shall be subject to 10% VAT.
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