Receiving capital in USD does not automatically grant the right to keep books in USD. Accounting law makes the dong the base accounting currency and opens the foreign-currency door only to companies that genuinely live in that currency.
The principle: VND is the base accounting currency
Under Article 10 of the Accounting Law 88/2015/QH13, the currency unit used in accounting is the Vietnamese dong. An enterprise whose receipts and payments are mainly in a foreign currency and which meets the prescribed conditions and criteria may choose one foreign currency as its bookkeeping unit, and must notify the managing tax authority of that choice. Circular 200/2014/TT-BTC guides exchange-difference handling and requires financial statements to be converted into dong at the prescribed rate. Receiving investment capital in USD is a single cash flow, not yet proof of mainly-USD operations.
What must be shown to book in USD
The company must show that most revenue, costs and operating transactions run in USD — typically an exporter earning mainly foreign currency and buying materials and services mainly in foreign currency — and that its accounting system can operate consistently in the chosen currency unit. The choice must be notified to the tax authority before application and kept stable for the fiscal year; switching currency units mid-stream carries its own balance-conversion procedure and consequences, not a mere software toggle.
Does foreign-currency bookkeeping complicate tax filing
Tax in Vietnam is always computed and paid in dong: a USD-booking company must convert for VAT, CIT and other returns. The practical friction sits in the consistency of conversion rates across books, invoices and returns, and in realised exchange differences — handled under the accounting regime with their own tax rules, and the very point auditors and tax inspectors probe most at foreign-currency bookkeepers. A company with few foreign-currency transactions that insists on USD books usually gains extra work without extra benefit.
Which rate converts figures for tax reporting
The current principle is the actual transaction rate at the time each transaction arises, and the prescribed rate when converting financial statements into dong for tax and State filing purposes. The company must fix one rate source in its accounting policy — the rate of the bank it regularly transacts with, per enterprise accounting guidance — and apply it consistently through the year. Mixing rate sources between periods is the error that makes converted figures unreconcilable at finalisation.
Frequently asked questions
If a company receives investment in USD, can it keep its books in USD?
Yes, if the company’s receipts and payments are mainly in USD and the conditions and criteria under Article 10 of the Accounting Law 88/2015/QH13 are met; merely receiving capital in USD is not enough.
Where do I apply to change the bookkeeping currency to USD?
Choose the foreign currency as the bookkeeping unit and notify the managing tax authority before applying it, keeping it stable for the fiscal year; changing the unit carries its own balance-conversion procedure.
Is it troublesome to keep books in a foreign currency and convert to VND when paying taxes?
Tax is always declared and paid in dong, so figures must be converted from the foreign-currency books; the friction is rate consistency across books, invoices and returns, and correct exchange-difference treatment under accounting and tax rules.
What exchange rate is used for conversion when preparing tax reports?
The actual transaction rate when each transaction arises, and the prescribed rate when converting financial statements into dong; the rate source must be unified in the accounting policy and applied consistently all year.
This article has been quality-reviewed by the FLAW AI Legal Council