On March 20, 2023, The General Department of Taxation issued Official Letter No. 786/TCT-CS, according to which:
In case the Company does not directly sell goods to consumers but sells through a system of distributors (direct purchase of the Company) and distributors’ retail points (purchase through distributors), the Company pays cash support for retail points through distributors if the retail outlets achieve the committed output according to the Company’s regulations and provides monetary support to sales staff of distributors who are not an employee of the Company, then:
Regarding corporate income tax: The above expenses are not enough to be determined as deductible expenses when calculating taxable income as prescribed in legal documents on corporate income tax.
Regarding personal income tax: Pursuant to the provisions of Circular No. 111/2013/TT-BTC dated August 15, 2013 of the Ministry of Finance, in case the Company directly pays bonuses to employees of distributors, The Company is responsible for withholding personal income tax in accordance with regulations.
