Official Letter No. 2625/TNI-QLDN2 from the Tay Ninh Provincial Tax Department dated November 5, 2025, addresses practical issues regarding corporate income tax incentives for Thanh Long Electrical Equipment Manufacturing Joint Stock Company in Tan Duc Industrial Park, Duc Hoa Commune. Based on the Corporate Income Tax Law No. 67/2025/QH15, the Investment Law No. 61/2020/QH14, and Decree 31/2021/ND-CP, this document outlines the conditions for project classification, determines the incentive area, and specifies the tax rate application mechanism. This is crucial guidance for businesses in the industrial manufacturing sector in Tay Ninh.
Official document No. 2625/TNI-QLDN2 shows that corporate income tax incentives depend not only on the type of project but also on investment procedures, implementation location, and revenue scale. In the context of Vietnamese businesses needing to restructure operations, upgrade technology, and expand production after 2025, compliance with tax regulations and correctly identifying incentives is crucial for survival. This article provides a detailed analysis of the document's content and its application to accounting, auditing, and tax practices. Read on to understand and avoid legal risks.
Classification of investment projects according to document No. 2625/TNI-QLDN2
A key aspect of Official Letter No. 2625/TNI-QLDN2 is determining whether an investment project is a new investment project or an expansion investment project. This is a fundamental criterion for applying corporate income tax incentives correctly. If a business misclassifies its investment, the tax authorities may reject the incentive, collect back taxes, or impose administrative penalties.
The concept of investment expansion projects in investment law.
According to Clause 5, Article 3 of the Investment Law No. 61/2020/QH14, an investment expansion project is an activity to develop an ongoing project through expanding its scale, increasing capacity, innovating technology, reducing pollution, or improving the environment. In practice, tax authorities often verify this based on technical data, equipment records, environmental permits, and operational capacity during audits.
An operating electronics factory purchased an additional SMT line, increasing its capacity by 30 percent. The business did not build a separate factory or create a new product line. According to Official Document No. 2625/TNI-QLDN2, this project is classified as expansion.
New investment projects in accordance with the law.
Clause 6, Article 3 of the Investment Law No. 61/2020/QH14 defines a new investment project as a project implemented for the first time or independent of an existing project. The aspect of independence is considered based on the product, production chain, space, and project objectives.
If a business opens a mechanical component manufacturing plant while already having an electrical wire factory, and their operations are independent of each other, then according to document No. 2625/TNI-QLDN2, this is considered a new investment project.
Investment procedures and notes as per official document No. 2625/TNI-QLDN2
The investment procedures and notes outlined in Official Letter No. 2625/TNI-QLDN2 are crucial for businesses to understand when an Investment Registration Certificate is required or not, as well as to clearly distinguish between capital transactions in order to apply corporate income tax incentives correctly. A proper understanding of these regulations helps accountants, auditors, and managers prepare complete legal documents, avoid errors in tax declarations, and protect the interests of businesses during the investment and project implementation process.
When is an Investment Registration Certificate not required?
Clause 2, Article 37 of the Investment Law No. 61/2020/QH14 stipulates that projects by domestic investors are not required to obtain an Investment Registration Certificate. This also applies to cases where economic organizations invest in the form of capital contribution, share purchase, or equity purchase.
Businesses often mistakenly believe that not applying for an Investment Certificate means they don't need legal documents. According to Official Letter No. 2625/TNI-QLDN2, businesses still need to provide proof of investment decision, land lease contract, environmental documents, and production reports.
Capital transactions and tax impacts
Purchasing assets is not considered an investment under the Investment Law. However, purchasing shares with management rights constitutes capital investment. When calculating corporate income tax, accountants must clearly distinguish between these two types of investments to apply appropriate incentives as per Official Letter No. 2625/TNI-QLDN2.
Identifying investment incentive areas according to document No. 2625/TNI-QLDN2
Appendix III of Decree 31/2021/ND-CP identifies Duc Hoa district as an area with difficult socio-economic conditions. Businesses operating there may enjoy incentives under tax laws and investment policies.
Article 21 of Decree 31/2021/ND-CP (amended by Article 1 of Decree 239/2025/ND-CP) stipulates that the rearrangement of administrative boundaries does not negate established incentives. Official Letter No. 2625/TNI-QLDN2 emphasizes that investors' rights continue to be protected.
The chief accountant must keep records of the original legal address, land lease contract, and confirmation document from the industrial park. This serves as evidence to protect the business when applying for incentives as per Official Letter No. 2625/TNI-QLDN2.
Corporate income tax rates are applied according to Official Letter No. 2625/TNI-QLDN2
Correctly determining the corporate income tax rate according to Official Letter No. 2625/TNI-QLDN2 is a crucial step for businesses to legally apply tax incentives and optimize tax costs. The document clearly guides the general tax rate (20%), the preferential rates (15% and 17%) based on revenue, as well as the preferential tax rate (10%) for 15 years for new investment projects and projects located in preferential areas. Understanding this regulation correctly helps accountants and auditors apply it accurately, avoid errors in tax declarations, and protect the interests of businesses.
General tax rate and revenue-based tax rate
According to Article 10 of the Corporate Income Tax Law No. 67/2025/QH15, the general tax rate is 20 percent. However, the revenue-based classification policy supports small and medium-sized enterprises.
| Business type | Total annual revenue | Tax rate |
| Small | ≤ 3 billion VND | 15% |
| Fit | > 3 billion – ≤ 50 billion | 17% |
| Standard | > 50 billion | 20% |
Preferential tax rate 10% for 15 years
Article 13 of the Corporate Income Tax Law No. 67/2025/QH15 applies a tax rate of 10 percent to new investment projects and projects located in preferential areas. Official Letter No. 2625/TNI-QLDN2 notes that the correct project type must be determined before applying for incentives.
Risks of misapplying policies according to document No. 2625/TNI-QLDN2
Misapplication of corporate income tax incentives as outlined in Official Letter No. 2625/TNI-QLDN2 poses significant legal and financial risks for businesses. Errors in declaring project types, revenue, or fraudulent revenue claims to qualify for incentives can lead to tax arrears, late payment penalties, and serious administrative sanctions. Thorough understanding of these regulations helps businesses avoid violations, ensure compliance with the law, and protect their rights when implementing investment projects.
Tax arrears and administrative penalties
If a business falsely declares the type of project or revenue, the tax authorities may collect back taxes for up to five years, charge late payment penalties, and impose fines. Falsified applications for tax incentives are considered a serious violation.
Fraudulently recording revenue to receive preferential treatment.
According to official document No. 2625/TNI-QLDN2, revenue used to determine the tax rate includes all revenue recorded according to standards, not just cash revenue. "Dividing a business into smaller entities" to reduce taxes is also considered tax evasion.
Applying Official Document No. 2625/TNI-QLDN2 in accounting, auditing, and taxation.
Applying Circular No. 2625/TNI-QLDN2 in accounting, auditing, and taxation helps businesses standardize records, manage risks, and ensure legal compliance. The complete preparation of investment and legal documents, as well as revenue analysis according to standards, not only supports the chief accountant in accurate management but also provides a basis for auditors to assess risks, verify tax incentives, and demonstrate good faith compliance when working with tax authorities.
Accounting document checklist
The chief accountant needs to prepare:
- Investment profile, funding sources, and business plan.
- Legal documents regarding the preferential treatment area.
- A standard revenue breakdown table.
- Historically, production scale changes when it comes to expansion.
Applications in auditing
The auditor assessed the risk of material misstatement related to the incentives. The tax refunds were considered under reasonable conditions. Referencing document No. 2625/TNI-QLDN2 helps the enterprise demonstrate good faith and compliance.
Conclude
Official document No. 2625/TNI-QLDN2 is an important document that helps businesses understand the classification of investment projects, determine preferential areas, and apply corporate income tax rates. Adhering to legal guidelines not only avoids post-audit risks but also optimizes cash flow.
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Content production by: Mr. Le Hoang Tuyen – Founder & CEO MAN – Master Accountant Network, Vietnamese CPA Auditor with over 30 years of experience in Accounting, Auditing and Financial Consulting.
