Covid-19 isolation expenses for the employee must be included in the taxable incomes for PIT and included in deductible expenses when calculating CIT

On November 10^th, 2020, Hanoi Tax Department issued Official Letter No. 97748/CT-TTHT guiding the PIT and CIT’s policy for expenses on the officials and employees during the Covid-19 pandemic as follows:

In case that, during the Covid-19 pandemic, the Company incurred isolation expenses for its employees who have to carry out the isolation procedures as stipulated by the law, if the above expenses’ content clearly state the names of the beneficiaries, they will be included in the taxable incomes for PIT.

The aforementioned expenses are direct expenditures on the employees’ welfare, not included in expenses for salary, bonuses as agreed and in accordance with the provisions of law, and being determined as deductible expenses when calculating CIT if such expenses meet the conditions in Article 4 Circular 96/2014/TT-BTC and the total expenditures on the employees’ welfare must not exceed 01-month salary in the practical implementation within the enterprises’ tax period.