Posted 3.07. 2019 by Cekindo / Last update on 8.07. 2019
When it comes to company registration in Vietnam, one of the legal entity options a foreign company would consider for their business establishment is a representative office.
A representative office gives a low-cost option for companies, especially for the first-time entrants who seek to understand the Vietnamese market. This is usually done before a foreign company makes a full entry or a larger presence by setting up a foreign company in Vietnam.
This article provides you with a quick guide to help you, as a foreign company, set up a representative office in Vietnam.
What CAN a Representative Office Do?
Activities that a representative office is permitted to do are the following:
What CAN’T a Representative Office Do?
A representative office is forbidden to carry out the following activities:
Business Registration Process of a Representative Office
Before getting a license for your representative office establishment, you will need to make sure that the following documents are ready. Most of the documents required a consularized copy and a notarised copy. Also, they will need to be translated into certified Vietnamese copies.
Business Process after Successful Representative Office Licensing
After you have acquired the representative office license, here are the things you will need to do to complete the entire representative office establishment process. Keep in mind that all required documents shall be notarized and translated into Vietnamese.
Establishment Duration of Representative Office
The timeframe for setting up a representative office is between 1.5 months to 2 months. Cekindo recommends you to hire a professional consultant to help you through the entire setup process for compliance and time-saving.
The validity of a representative office license is five years, and extendable for an extra five years.
Tax Reporting and Hiring for Representative Office
Currently, Vietnam has no restriction on the number of foreign employees that a representative office can hire. Of course, a work permit is required for each foreign worker in Vietnam. Hiring and recruiting of foreigners can be made easy through the assistance of a recruitment and HR agency.
As for tax reporting, a representative office is only responsible for employee’s personal income tax (PIT), but not subject to corporate income tax (CIT) in Vietnam. All tax reports have to be submitted by January 30 every year.
Setting up a representative office in Vietnam requires legal expertise and experience. Follow the following steps for a smooth business setup in Vietnam.