Vietnam’s Global Minimum Tax implementation: Overall and key points of Decree 236/2025/ND-CP

Vietnam has formally adopted Decree 236/2025/ND-CP, aligning with the OECD’s Pillar Two Global Minimum Tax framework. This legislation introduces new compliance obligations for multinational enterprises operating in the country, effective October 15, 2025. This legislation brings the country into alignment with international standards, implementing the OECD’s ambitious 15% minimum tax framework that targets the world’s largest companies. Decree 236 introduces specific compliance obligations across registration, filing, and payment procedures. Understanding these requirements ensures timely and accurate compliance while minimizing penalty risk.

Key takeaways

• Decree 236/2025/ND-CP implements Vietnam’s Global Minimum Tax effective October 15, 2025, targeting multinational groups with EUR 750 million revenue and implementing Global Minimum Tax with transitional simplified ETR safe harbors of 15% (FY 2024), 16% (FY 2025), and 17% (FY 2026), in line with the 15% minimum tax framework.
• Vietnam adopts OECD Pillar Two framework with Qualified Domestic Minimum Top-up Tax prioritizing domestic collection over foreign jurisdiction rules.
• Safe harbor provisions can reduce top-up tax to zero where either (i) de minimis thresholds are met (revenue < EUR 10 million and profit before tax < EUR 1 million or loss), or (ii) simplified ETR is at least 15% (FY 2024), 16% (FY 2025), or 17% (FY 2026).
• Multinational enterprises must notify the Filing CE and in-scope CEs within 30 days after fiscal year-end and complete GMT tax registration within 90 days; GMT and IIR returns are filed 12–18 months after fiscal year-end, depending on the provision type.

Vietnam’s strategic adoption of OECD Pillar Two framework

Understanding transitional qualified status

Vietnam achieved transitional qualified status on August 18, 2025, confirming that its QDMTT and IIR frameworks meet OECD standards. This recognition allows Vietnamese tax authorities to collect top-up tax with priority over foreign jurisdictions and provides MNEs with compliance certainty.

For multinational enterprises, Vietnam’s qualified status delivers practical advantages: streamlined filing procedures requiring consolidated data only once; reduced risk of conflicting audit assessments across jurisdictions; predictable enforcement timelines aligned with OECD guidance.

Vietnam’s achievement marks the culmination of extensive consultation processes. The OECD assessed Vietnam’s legislation against rigorous compliance metrics, evaluating technical provisions, administrative procedures, and enforcement capabilities.

Vietnam’s compliance with OECD Pillar Two framework

Vietnam’s implementation demonstrates sophisticated alignment with OECD standards. The framework integrates QDMTT mechanics within existing corporate income tax procedures, establishes clear registration and filing workflows, and commits to multilateral reporting—characteristics that reflect both technical competence and pragmatic design.

The OECD specifically recognized Vietnam’s Qualified Domestic Minimum Top-up Tax (QDMTT) mechanism. This domestic collection system prevents foreign jurisdictions from imposing Income Inclusion Rules (IIR) on Vietnamese operations meeting effective tax rate thresholds.

Vietnam’s compliance documentation demonstrates sophisticated understanding of international tax coordination. The decree incorporates safe harbor provisions, ordering rules, and transitional measures that exceed minimum OECD requirements.

Note: Vietnam has implemented QDMTT provisions under Decree 236/2025/ND-CP. OECD transitional qualified status recognition is subject to OECD Inclusive Framework assessment procedures.

Legislative journey from Resolution 107/2023/QH15 to Decree 236/2025/ND-CP

Legislative Foundation (November 29, 2023): Resolution 107/2023/QH15 established the statutory authority for Vietnam’s GMT implementation, setting the foundation for 18 months of regulatory refinement before Decree 236’s practical application in October 2025

The drafting process incorporated feedback from Vietnam’s business community and international partners. Notable refinements addressed initial concerns about compliance timelines for groups with complex consolidation structures, resulting in extended registration deadlines (90 days) and transitional penalty relief for minor documentation gaps.

Scope of application: Multinational enterprise groups subject to Global Minimum Tax

Decree 236 establishes a dual-mechanism approach combining QDMTT and IIR systems, ensuring comprehensive coverage while preventing double taxation.

The QDMTT mechanism operates as Vietnam’s primary enforcement tool. When Vietnamese constituent entities meet effective tax rate thresholds, Vietnam collects domestic top-up tax rather than allowing foreign parent jurisdictions to impose IIR charges.

The IIR system applies when Vietnamese parent entities hold constituent entities in low-tax jurisdictions. Vietnam imposes top-up tax on foreign operations that fail to meet minimum tax rate requirements.

General provisions and core framework

Key Definitions and Scope:

• Constituent Entities: All entities included in consolidated financial statements of Ultimate Parent Entity (UPE)
• Ultimate Parent Entity: Holding company at apex of MNE group ownership structure
• Filing CE: Designated constituent entity responsible for group compliance obligations
• Revenue Threshold: EUR 750 million consolidated revenue in at least two of four preceding fiscal years

Under Decree 236, several foundational definitions establish how multinational enterprises fall within Vietnam’s global minimum tax framework.

The Regulatory Scope requires groups exceeding EUR 750 million in consolidated revenue during two of four preceding fiscal years to participate. This foundational guideline ensures consistent application across various business structures.

Testing periods span four years, allowing temporary fluctuations below the threshold. Consolidation follows accounting standards used in Ultimate Parent Entity financial statements. The QDMTT and IIR systems work together, with domestic charges taking priority over international rules, creating thorough coverage while preventing double taxation scenarios.

Exclusion from QDMTT for MNEs in the initial phase

Vietnam provides transitional relief for qualifying MNEs during initial implementation:

Eligibility Criteria:

• Initial phase exclusion: MNE groups with constituent entities in no more than six jurisdictions and total book value of tangible assets of all CEs in other jurisdictions not exceeding USD 50 million

The initial phase exclusion covers fiscal years 2024–2028 for MNE groups meeting criteria (six or fewer jurisdictions, USD 50M tangible assets ceiling). After FY2028, all qualifying MNEs must apply full QDMTT compliance without transition relief.

To maintain initial phase exclusion, MNE groups must annually submit supporting documentation—business plans, capital deployment schedules, and operational milestones. Vietnamese tax authorities conduct periodic reviews to verify that groups have established genuine economic substance and are progressing toward scale-appropriate GMT compliance.

QDMTT safe harbor provisions

Safe harbors offer immediate relief without complex calculations—a critical advantage for smaller multinational groups during the transitional period (through June 30, 2028). Qualifying entities can elect simplified compliance by meeting one of three conditions:

Calculation Methodology:

• De minimis test: Constituent entities with revenue less than EUR 10 million and total profit before tax less than EUR 1 million (or loss) in that jurisdiction
• Simplified ETR test: Entities meeting 15% effective tax rate through standardized calculation
• Transitional safe harbor: Temporary relief during initial three-year implementation period

Safe harbor elections require annual confirmation and supporting documentation. MNEs must demonstrate continued eligibility through financial statements, tax returns, and country-by-country reports.

This approach cuts compliance costs significantly. Vietnam aligns safe harbor eligibility with OECD standards, ensuring that if your subsidiary qualifies in one jurisdiction, you don’t face conflicting audit assessments or double taxation elsewhere—practical certainty for cross-border operations.

The safe harbor provisions offer multinational enterprises a streamlined pathway to demonstrate QDMTT compliance without complex calculations. Companies meeting International Standards can elect this simplified approach by filing specific documentation with Vietnamese tax authorities before the prescribed deadline. The Election Process requires submitting Country-by-Country Reports, transfer pricing documentation, and qualifying income calculations using prescribed formulas.

Effective compliance depends on accurate documentation and calculation rigor. While large MNEs with established transfer pricing and consolidation procedures adapt readily, smaller multinational groups should prioritize early registration and engage specialized advisors to validate ETR methodologies and safe harbor eligibility before filing deadlines.

IIR Top-up tax ordering rule

Vietnam’s ordering rules establish clear priority sequences for top-up tax collection:

Priority Sequence:

1. QDMTT collection: Vietnam collects on Vietnamese constituent entities meeting jurisdiction-specific requirements
2. Primary IIR: Ultimate Parent Entity jurisdiction collects on all other low-tax operations
3. Secondary IIR: Intermediate holding companies collect remaining amounts through ownership chain
4. Undertaxed Profits Rule (UTPR): Remaining group members allocate uncollected amounts through denial of deductions or equivalent adjustments

The allocation methodology prevents double taxation while ensuring comprehensive coverage. Credit mechanisms offset amounts collected by multiple jurisdictions to maintain the 15% minimum effective tax rate objective.

Coordination procedures require information sharing between Vietnamese tax authorities and foreign counterparts. This collaboration ensures consistent application and prevents disputes over allocation responsibilities.

How Vietnam’s financial accounting standards are affected by Decree 236

Decree 236 introduces significant modifications to Vietnamese Accounting Standards (VAS) for GMT compliance. These changes ensure consistency between financial reporting and tax calculation methodologies.

The modifications primarily affect consolidation procedures, equity accounting methods, and foreign currency translation requirements. Vietnamese entities must implement GloBE-specific adjustments while maintaining compliance with existing accounting standards.

Modifications to Consolidated financial reporting

Key Accounting Changes:

• Equity method adjustments: Modified treatment of associated companies and joint ventures for GloBE inclusion
• Foreign currency standardization: Mandatory use of functional currency with specified translation methods
• Consolidation scope: Expanded inclusion criteria for investment entities and special purpose vehicles
• Timing adjustments: Alignment of recognition periods between financial and tax calculations

The equity accounting modifications require Vietnamese entities to recalculate investment income using GloBE-specific methodologies. This ensures consistent treatment across all constituent entities within MNE groups.

Foreign currency translation follows standardized rates and methodologies prescribed by OECD guidance. Vietnamese entities must maintain parallel calculations using both Vietnamese GAAP and GloBE requirements.

Consolidation scope adjustments particularly affect financial services and real estate investment groups. These sectors often utilize complex structures requiring careful analysis under expanded inclusion criteria.

QDMTT amount determination and Zero-tax scenarios

Zero-Tax Determination Circumstances:

• Loss positions: Net operating losses eliminate top-up tax liability for current period
• Carry-forward utilization: Prior period losses offset current year positive adjustments
• Safe harbor qualification: Entities meeting simplified ETR tests avoid detailed calculations
• De minimis thresholds: Small operations below materiality limits receive automatic relief

The treatment of losses requires careful tracking across multiple fiscal years. Vietnamese entities must maintain detailed records of loss origins, utilization patterns, and carry-forward availability.

Your QDMTT calculations must tie directly to your Country-by-Country Report (CbCR). Vietnamese authorities systematically cross-check both filings; discrepancies trigger audit flags. Maintaining aligned documentation across CbCR and QDMTT returns—a single source of truth—prevents compliance surprises.

Financial statement documentation and variance reconciliation

Mandatory Documentation Requirements:

• Calculation worksheets: Detailed supporting schedules for all GloBE adjustments and determinations
• Variance reconciliations: Explanations of differences between financial statement and tax calculations
• Supporting evidence: Source documents, contracts, and legal agreements substantiating positions
• Audit trails: Complete documentation chains enabling independent verification

The documentation requirements create comprehensive audit trails for Vietnamese tax authorities and external auditors. This transparency facilitates efficient examination procedures and reduces compliance disputes.

Quarterly reporting alignment ensures consistency throughout fiscal years. Vietnamese entities must maintain running calculations and periodic reconciliations to identify issues before final reporting deadlines.

Tax registration, filing procedures, and compliance requirements

Vietnam’s Global Minimum Tax requires multinational companies to follow detailed registration and filing rules, which include specific deadlines, necessary documents, and compliance steps within set administrative guidelines.

Note: FYE = Fiscal Year-End

Notification on the appointment of Filing CE and In-Scope CEs

Multinational enterprises operating in Vietnam must navigate specific notification procedures to establish their global minimum tax compliance framework. The Appointment Notification process requires careful attention to deadlines and proper Entity Designation protocols.

Companies must complete two critical forms following these steps:

Form 01/TB-DVHT – Filing CE Appointment:

The Filing CE notification establishes the responsible entity for group-wide GMT compliance. This designation carries significant responsibilities and potential liabilities.

Required Information:

• Entity identification: Legal name, tax identification number, and registered address
• Authorization documentation: Board resolutions and power of attorney confirming appointment
• Contact information: Designated representatives and communication channels
• Effective dates: Commencement and expected duration of Filing CE responsibilities

Deadline: 30 days after fiscal year-end or 10 days after Filing CE appointment, whichever occurs first.

Form 01/TB-DVHT – In-Scope CE Identification:

This notification identifies all Vietnamese constituent entities within the MNE group subject to GMT obligations.

Required Details:

• Complete entity listings: All Vietnamese subsidiaries, branches, and permanent establishments
• Ownership structures: Percentage holdings and control relationships
• Business activities: Primary operations and revenue sources for each entity
• Financial information: Revenue, profit, and tax amounts for threshold testing

Late or incomplete notifications risk penalties, but Decree 236 provides grace periods: up to 90 days late triggers reduced administrative penalties if corrected before examination notice. The practical solution: designate a Filing CE early, establish a compliance calendar 30 days before each deadline, and engage specialized advisors to validate submissions before filing.

Tax registration process and procedures

Following successful CE appointment notifications, companies must complete a thorough tax registration process to establish their global minimum tax obligations with Vietnamese authorities.

Form 01-DKTD-DVHT Registration Requirements:

Tax registration creates formal relationships between MNEs and Vietnamese tax authorities for GMT purposes.

Registration Components:

• Unique tax codes: Specialized GMT identification numbers separate from regular CIT codes
• Electronic system access: Credentials for online filing and payment platforms
• Representative designation: Authorized persons for tax authority communications
• Compliance history: Previous tax obligations and penalty status disclosures

Timeline: 90 days after fiscal year-end, with possible 30-day extensions for documented hardship cases.

The electronic submission system requires specific technical capabilities and security protocols. MNEs should coordinate with IT departments and service providers to ensure system compatibility and data security.

Tax filing and payment obligations

QDMTT Filing Requirements:

QDMTT returns must be submitted within 12 months after fiscal year-end. This timeline aligns with most jurisdictions’ IIR filing requirements to facilitate coordination.

Required Documentation:

• GloBE Information Return: Comprehensive group-wide financial and tax data
• Supplementary CIT Return: Vietnam-specific calculations and adjustments
• Supporting schedules: Detailed workings for effective tax rate determinations
• Documentation packages: Evidence supporting positions and elections

IIR Filing Requirements:

IIR returns have extended deadlines: 15 months after fiscal year-end (18 months for initial year). This additional time allows for coordination with foreign jurisdictions and comprehensive data gathering.

Payment Procedures:

Top-up tax payments are due with return filings unless alternative arrangements are approved. Vietnam accepts electronic payments through designated banking channels and government payment platforms.

Penalty Framework:

• Late filing: 20% of tax liability or a minimum of VND 40 million
• Late payment: 0.03% per day of outstanding amounts
• Inaccurate reporting: 10-30% of additional tax assessments plus interest
• Non-compliance: Suspension of investment incentives and business licenses.

Decree 236 provides transitional penalty relief during fiscal years 2024–2028 for:

(1) late notification up to 90 days;

(2) incorrect/incomplete filings not resulting in tax underpayment;

(3) late tax returns filed within 90 days with no tax payable; and

(4) failures to submit documentation within 90 days when no tax liability arises.

Note: Penalty amounts subject to Law on Tax Administration No. 38/2019/QH14 and implementing regulations. Consult legal counsel for specific penalty calculations.