Quick answer: CIT incentives do not end at first registration — companies must report annually to the tax authority on incentive implementation, tied to the CIT finalization period (90 days from the fiscal year-end). The report shows whether incentive conditions were still met during the year, the exact exempted and reduced tax amounts, and any changes affecting eligibility. Late, wrong or missing reports can cost the year’s incentives — a very high price for a seemingly simple administrative duty.
Applicable legal bases
The framework below is in force as of the writing date (20/10/2026) and directly governs this article:
- Corporate Income Tax Law 67/2025/QH15 (effective 01/10/2025, applicable from tax year 2025) — company duties during the incentive period.
- Decree 236/2025/ND-CP (effective 15/10/2025) — guidance on reporting incentive implementation.
- Tax Administration Law 108/2025/QH15 (effective 01/7/2026, replacing Law 38/2019/QH14) — CIT finalization deadlines and late-filing sanctions.
- Decree 125/2020/ND-CP — administrative tax penalties for late filing and misdeclared tax dossiers.
In-depth analysis
The annual report is the tax authority’s tool for continuously monitoring incentive conditions — which is why it matters more than its administrative appearance suggests. Tax incentives are not a “buy once, use forever” right — each year the company must demonstrate it still meets the conditions committed at registration: still operating in the incentivized business line, maintaining scale and location, segregating income. Any non-qualifying year loses that year’s incentives — and the annual report is where the company self-declares this status. Not filing leaves the authority with no basis to confirm conditions, and the legal consequence is typically disqualification for the missing-report year.
Report content has three blocks. The first is condition compliance: business line, location and scale changes versus initial registration. The second is tax figures: incentivized income, exempted and reduced amounts, applied rates — which must reconcile with the year’s CIT finalization return. The third is affecting events: ownership changes, mergers, splits, relocations, business-line changes — anything that could alter eligibility must be truthfully declared. The three blocks must be mutually consistent and consistent with the finalization return; contradictions between the incentive report and the return flag the company for in-depth examination.
The deadline tracks the CIT finalization period: 90 days from the fiscal year-end (for calendar fiscal years, end of March). Best practice is preparing the incentive report in parallel with finalization using one reconciled dataset — instead of finishing finalization first and then discovering mismatched figures. ERP-equipped companies should build templates auto-extracting from accounting data; companies using outsourced bookkeeping must put the incentive-reporting duty into the service contract from the start, since many bookkeepers file tax returns but “forget” the incentive report.
Four contents of the annual incentive report
- Condition compliance: business line, location and scale during the year versus initial registration — what changed.
- Incentivized tax figures: incentivized income, exempted and reduced amounts, applied rates — reconciled with the finalization return.
- Affecting events: ownership, merger, split, relocation, business-line changes — truthful declaration.
- Continued-compliance confirmation: confirming conditions for the next year or notifying loss of eligibility.
Common risks and how to prevent them
- “Forgetting” the report after filing the return: the finalization return and the incentive report are separate duties — keep an annual tax-duty checklist covering both.
- Report figures diverging from the return: prepare the incentive report in parallel with finalization on one reconciled dataset.
- Undeclared condition changes: assess incentive impact before any business-line, location or ownership change, and declare truthfully.
- Outsourced bookkeeper skipping the report: write this duty into the bookkeeping service contract from day one with a specific deadline.
Frequently asked questions
1. When is the incentive report due?
Tied to CIT finalization: 90 days from the fiscal year-end. For calendar fiscal years, the deadline is the last day of March of the following year.
2. Must we report in a loss year with no tax payable?
Yes — the reporting duty is independent of tax payable. Loss years still require condition-compliance reporting to preserve incentives for later years.
3. What are the penalties for late reporting?
Administrative penalties for late tax-dossier filing under Decree 125/2020/ND-CP, plus possible disqualification for the missing year — far costlier than the fine.
4. We discover a prior year failed the conditions — what now?
Voluntarily declare and repay the exempted and reduced tax of the non-qualifying year plus late-payment interest — self-remediation is always lighter than inspection findings.
Key takeaway for investors
Tax incentives are a benefit “renewed” yearly through reporting. Build the incentive report into the annual tax finalization process on one dataset — do not let a small administrative duty cost a whole incentive year.
This article has been quality-reviewed by the FLAW AI Legal Council This content is legal reference only and does not replace counsel for a specific case.