Remitting profits to the overseas parent company - conditions, timing and documents

After a few years of operation, the parent company in Tokyo, Seoul or Singapore usually asks very specific questions: when can profits be remitted, how much, and what documents are needed? From 1 July 2026, these conditions are set out for the first time directly in a decree implementing the Law on Tax Administration: Article 27.6 of Decree 252/2026/ND-CP. The most notable point is the explicit rule on accumulated losses, a frequent reason why dividend plans slip.

Conditions for annual remittance

Under Article 27.6(a) of Decree 252/2026/ND-CP, a foreign investor may remit abroad each year the profits distributed or earned from its direct investment in Vietnam at the end of the financial year, after the Vietnamese company has:

• Fulfilled its financial obligations to the Vietnamese State as required by law.
• Submitted its audited financial statements and annual CIT finalization return to the managing tax office.
• Paid in full the taxes, other State revenues, late payment interest and administrative penalties that have fallen due.
• No outstanding tax debt at the time of remittance.

Point (c) of the same clause adds an important condition: the foreign investor may not remit the profits of a year if the company's financial statements for that year still show accumulated losses after loss carry-forward under CIT rules. Corporate law sets its own condition as well: under Article 69 of the Law on Enterprises 2020 (as amended by Law No. 76/2025/QH15), a multi-member limited liability company may distribute profits only when it is profitable, has met its tax and other financial obligations, and can still pay its debts as they fall due after the distribution.

Timing: annually and on exit

Decree 252/2026/ND-CP provides for only two remittance points: annually after the financial year ends and when the direct investment in Vietnam is terminated. There is no mechanism for interim remittances during the year, so companies should not plan quarterly or mid-year remittances. On termination (Article 27.6(b)), the company must settle all tax obligations under the Law on Tax Administration, including those not yet due, before remitting the remaining profit.

Tax on remitted profits

The profit remitted is after-tax profit, on which CIT has already been paid in Vietnam. For corporate foreign investors, there is currently no withholding tax when profits are remitted to the parent. For individual investors, income from capital investment is subject to 5% PIT: Article 22 of the Law on Personal Income Tax No. 109/2025/QH15 applies to non-residents and Article 12 to residents, and the distributing company must withhold the tax before payment. The parent's own tax position in its home country should be reviewed under that country's law and the relevant tax treaty.

Documents and practical procedure

1. Audited financial statements for the year of the distribution: mandatory for foreign-invested enterprises under Article 37 of the Law on Independent Audit No. 67/2011/QH12.
2. The filed CIT finalization return and tax payment receipts; check the tax account on the tax authority's system to confirm there is no debt, including small late payment interest amounts.
3. Profit distribution decision of the owner or resolution of the Members' Council or General Meeting of Shareholders, stating the amount and the profit year.
4. Notice to the tax authority: Article 5 of Circular 186/2010/TT-BTC requires notifying the managing tax office at least 7 working days before the transfer. Decree 252/2026/ND-CP does not mention this step; at the time of writing we have not seen a document clearly confirming its abolition, so companies should confirm with their tax office and their bank.
5. Bank documents: profits are remitted abroad through the direct investment capital account under SBV Circular 06/2019/TT-NHNN. Banks typically ask for the documents above together with evidence that the profit is lawful.

A practical note: if the amount remitted exceeds the distributable profit in the audited financial statements, or the transfer is made before the finalization is filed, the bank may refuse it or the tax authority may revisit it during an audit. The dividend plan should therefore be fixed together with the audit and finalization plan.

How Kaizen can help

Kaizen helps FDI companies review accumulated losses, outstanding tax obligations and the remittance document set before approaching the bank. Sign up for our free tax health check and we will identify early anything that could delay next year's profit remittance.