New regulations on tax management for enterprises with related-party transactions

On 10/2/2025, the Government issued Decree No. 20/2025/ND-CP amending and supplementing a number of articles of Decree No. 132/2020/ND-CP dated November 5, 2020 regulating tax management for enterprises with related-party transactions.

Accordingly, Decree No. 20/2025/ND-CP amends and supplements points d, k and adds point m, Clause 2, Article 5 of Decree No. 132/2020/ND-CP on related parties.

The Decree No. 20/2025/ND-CP amends Point d, Clause 2, Article 5 of Decree No. 132/2020/ND-CP as follows: An enterprise guarantees or lends capital to another enterprise in any form (including loans from third parties secured by the financial resources of the affiliated party and financial transactions of a similar nature) provided that the total outstanding loans of the borrowing enterprise with the lender or guarantor is at least equal to 25% of the capital contribution of the owner of the borrowing enterprise and accounts for more than 50% of the total outstanding loans of all medium- and long-term debts of the borrowing enterprise.

The provisions of Point d above do not apply to the following cases:

d.1) The guarantor or lender is an economic organization operating under the provisions of the Law on Credit Institutions 2024 that does not directly or indirectly participate in the management, control, capital contribution, or investment in the borrowing enterprise or the guaranteed enterprise as prescribed in Points a, c, d, e, g, k, l, and m of this Clause.

d.2) The guarantor or lender is an economic organization operating under the provisions of the Law on Credit Institutions and the borrowing enterprise or guaranteed enterprise is not directly or indirectly subject to the management, control, capital contribution, or investment of another party as prescribed in Points b, e, and i of this Clause.

The Decree No. 20/2025/ND-CP amends Point k, Clause 2, Article 5 of Decree No. 132/2020/ND-CP, which stipulates related parties as follows: k) Other cases in which an enterprise (including an independent accounting branch that declares and pays corporate income tax) is subject to the actual management, control, and decision-making on the production and business activities of the other enterprise;

The Decree No. 20/2025/ND-CP also adds Point m to Clause 2, Article 5 of Decree No. 132/2020/ND-CP, which stipulates related parties as: Credit institutions with subsidiaries or with controlling companies or with affiliated companies of credit institutions as prescribed in the Law on Credit Institutions and amendments, supplements, or replacements (if any).

The new Decree supplements the responsibilities of the State Bank, requiring the State Bank to coordinate in providing information reported in accordance with the law on related persons of members of the Board of Directors, members of the Board of Members, members of the Supervisory Board, General Director (Director), Deputy General Director (Deputy Director) and equivalent positions as prescribed in the Charter of the credit institution; related persons of shareholders owning 1% or higher of the charter capital of the credit institution; affiliated companies of the credit institution according to the State Bank's management data information system when requested by the tax authority.

This Decree takes effect from March 27, 2025 and applies from the 2024 corporate income tax period.