The group’s regional parent sits in Singapore. Every year, its head of accounting receives an email from the subsidiary in Hai Phong: “Please send the group’s Master File for our transfer pricing file.” In 2026, the email added a line: “There is a new decree this year — could you check what changed?” The answer is no longer a simple forward of last year’s file.
The three-tier file remains mandatory
Decree 255/2026/ND-CP (issued 30 June 2026, effective 1 July 2026, applying to the 2026 CIT period) replaces Decree 132/2020 and Decree 20/2025, while retaining the full three-tier documentation framework:
- Master File: prepared at ultimate-parent or regional-parent level — the group-wide picture: organisation, value chain, intangibles, intra-group financing.
- Local File: prepared by the Vietnamese subsidiary — the specific related-party transactions in Vietnam and the arm’s length analysis.
- CbCR (Country-by-Country Report): the ultimate parent’s obligation, shared with Vietnamese tax authorities through information exchange.
What is new in Decree 255 for regional parents
Four points summarised by major audit firms: first, an expanded exemption threshold for transfer pricing documentation for low-risk businesses — small subsidiaries may escape full filing; second, a completed CbCR legal framework linked to Official Letter 3870/CT-CS of the tax authority; third, a standardised priority order for comparable databases; fourth, administration based on the economic substance of transactions and taxpayer risk, instead of blanket audits.
The practical message: a regional parent cannot “prepare once, reuse forever”. The Master File must track value-chain changes — if the group moved its procurement hub from Singapore to Vietnam this year, the functional analysis must be rewritten.
The regional parent’s concrete role
The regional parent is typically the source of three information sets the Vietnamese subsidiary cannot produce alone:
- Group description, ownership chart, in-year restructurings — Master File inputs.
- Group transfer pricing policy: how management fees, royalties and intra-group interest are priced.
- Regional benchmark data where the Vietnamese market lacks comparable uncontrolled transactions.
A common mistake: the parent sends an English Master File and the subsidiary files it as-is, with no Local File analysing the Vietnamese transactions. Tax authorities do not accept a global file as a substitute for a local one.
Compliance timeline for the 2026 tax year
Transfer pricing documentation must be prepared before the annual CIT finalisation filing and retained for presentation on request. With the Law on Tax Administration 108/2025 (effective 1 July 2026) strengthening risk-based tools, groups should finalise the Master File early in the fiscal year so subsidiaries have time to build Local Files — not during finalisation season.
Frequently asked questions
Does a small Vietnamese subsidiary need all three tiers?
Decree 255 expands the documentation exemption for low-risk businesses. Companies should measure their revenue and related-party transaction values against the exemption thresholds; above the thresholds, full documentation still applies.
Can a foreign-prepared Master File be used in Vietnam?
Yes as an input, but the Vietnamese subsidiary must still prepare its own Local File analysing transactions arising in Vietnam. The two documents complement, not replace, each other.
Who files the CbCR?
The CbCR obligation sits with the ultimate parent of the multinational group (subject to the consolidated revenue threshold), with information shared with Vietnam under tax authority exchange agreements.
What happens without transfer pricing documentation?
The tax authority may deem related-party prices, assess back taxes and impose administrative penalties under the Law on Tax Administration 108/2025. A reassessment usually costs far more than preparing proper documentation upfront.
FLAT Law Firm reviews transfer pricing documentation duties under Decree 255/2026, coordinates with regional parents on Master File preparation and builds Local Files for Vietnamese subsidiaries. Contact us for a 2026 compliance roadmap.
This article has been quality-reviewed by the FLAW AI Legal Council
