Detailed Guide on Profit Repatriation: Conditions, Procedures & Key Notes

Three Key Conditions for Repatriating Profits from Vietnam

To obtain approval from the tax authority and commercial bank for repatriating profits abroad, a foreign-invested enterprise (FDI company) must fully satisfy the three mandatory conditions below:

1. The Fiscal Year Must Be Completed

Profit repatriation is only allowed for the profits of the previous fiscal year, after the company has completed submission of its audited Financial Statements and Corporate Income Tax (CIT) finalization return for that year.

Note: Mid-year profit repatriation (before the fiscal year ends) is not permitted.

2. No Accumulated Losses

This is the most critical condition. Profits can only be transferred abroad after all accumulated losses from previous years have been fully offset in accordance with Vietnamese tax regulations.
In short, the enterprise must be genuinely profitable and have no remaining losses on record.

3. Corporate Income Tax Obligations Must Be Fully Settled

To remit profits abroad, the enterprise must prove it has fulfilled all Corporate Income Tax (CIT) obligations related to the profits being transferred.
This is verified through the CIT finalization return and valid tax payment receipts.

5-Step Procedure for Transferring Profits Abroad

Once the above conditions are met, the FDI company must follow the standard 5-step process below to complete the profit remittance legally:

Step 1: Complete Financial Statements and Independent Audit

• Finalize the company’s annual financial statements.

• Engage a licensed independent audit firm in Vietnam to perform the audit.
  The audited report serves as the legal basis for determining the distributable profit amount.

Step 2: File CIT Finalization with the Tax Authority

• Submit the audited financial statements and CIT finalization return to the managing tax office.

• Complete any tax payments based on the finalized assessment.

Step 3: Issue the Official Profit Distribution Resolution

• The Members’ Council (for LLCs) or General Meeting of Shareholders (for JSCs) must issue an official Resolution on profit distribution, clearly stating the amount to be repatriated.

Step 4: Submit a Profit Repatriation Notice to the Tax Authority

• Send the official “Notification of Profit Repatriation Abroad” (as per the prescribed form) to the managing tax authority before executing the transfer.
  This allows the authority to review and verify the company’s eligibility.

Step 5: Prepare Documents and Execute the Transfer via Bank

• Prepare all required documents as requested by the commercial bank where the Direct Investment Capital Account (DICA) is opened.

• Execute the profit remittance transaction through that bank.

In summary:
By strictly following this 5-step profit repatriation process — from auditing and tax finalization to board resolution, tax notification, and bank transfer — foreign investors can ensure their profit remittance from Vietnam is smooth, compliant, and risk-free.