Tax Filing for Vietnamese Companies in India
India and Vietnam share a Comprehensive Strategic Partnership, with bilateral trade reaching US$15.76 billion in FY25 — a 6.4% year-on-year increase. India is Vietnam's 8th largest trading partner globally, while Vietnam is India's 20th largest. Vietnamese companies have been steadily increasing their footprint in India across sectors including electronics, textiles, agricultural processing, energy, and consumer goods, with Indian investment in Vietnam estimated at US$2 billion.
Every Vietnamese-owned entity operating in India — whether a wholly-owned subsidiary, joint venture, branch office, or project office — must comply with India's tax filing obligations under the Income Tax Act, 1961, the GST Act, and FEMA regulations. This encompasses monthly GST filings, quarterly TDS returns, quarterly advance tax payments, annual income tax returns, transfer pricing reports, and regulatory filings with the Reserve Bank of India.
Beacon Filing provides comprehensive tax filing services specifically designed for Vietnamese companies operating in India, ensuring full statutory compliance while maximising treaty benefits under the India-Vietnam DTAA.
How Vietnam's DTAA Affects Tax Filing
The India-Vietnam Double Taxation Avoidance Agreement, signed in 1994 and in force since 1995, establishes the framework for taxing cross-border income between the two countries and directly impacts how your Indian subsidiary's intercompany payments are taxed and reported.
Withholding Tax Rates Under the DTAA
When your Indian subsidiary remits payments to the Vietnamese parent entity, the following DTAA rates apply instead of India's higher domestic rates:
- Dividends: 10% — a significant reduction from India's domestic withholding tax rate of 20% on dividends paid to non-residents. The uniform 10% rate applies regardless of the Vietnamese parent's shareholding percentage.
- Interest: 10% — applicable on all interest payments from intercompany loans, bonds, and debentures between the Indian subsidiary and the Vietnamese parent.
- Royalties: 10% — covers licensing fees for technology, trademarks, intellectual property, and software paid by the Indian entity to the Vietnamese parent.
- Fees for Technical Services (FTS): 10% — includes management fees, technical assistance, engineering services, and shared service charges from the Vietnamese parent.
Permanent Establishment (PE) Considerations
Under Article 5 of the India-Vietnam DTAA, a Vietnamese company may create a permanent establishment in India through a fixed place of business, a construction project lasting more than 183 days, or employees providing services in India for a specified duration. A PE triggers separate income tax filing obligations on business profits attributable to the Indian PE, requiring detailed profit attribution analysis and transfer pricing documentation.
Claiming Treaty Benefits in Tax Returns
To claim reduced DTAA rates on cross-border payments, the Vietnamese entity must obtain a Tax Residency Certificate (TRC) from Vietnam's General Department of Taxation. The Indian subsidiary must file Form 10F alongside the TRC with Indian tax authorities before applying treaty rates to TDS deductions. Both documents must be renewed and on file for each financial year.
Document Requirements from Vietnam
Vietnam acceded to the Hague Apostille Convention on 31 December 2025, but the convention will not enter into force for Vietnam until 11 September 2026. Until that date, Vietnamese documents require the traditional consular legalization process — notarisation, attestation by Vietnam's Ministry of Foreign Affairs, and authentication by the Indian Embassy in Hanoi or the Indian Consulate in Ho Chi Minh City.
Documents for Tax Filing Setup
- Enterprise Registration Certificate (Giay chung nhan dang ky doanh nghiep) of the Vietnamese parent company — notarized, attested by Vietnam's MFA, and authenticated by the Indian Embassy in Hanoi
- Board Resolution authorizing appointment of an Indian Chartered Accountant for tax compliance — notarized and embassy-attested
- All intercompany agreements (management fees, technical services, royalties, loans) — essential for transfer pricing documentation with detailed scope, pricing methodology, and arm's length benchmarking
- Vietnamese parent's audited financial statements — required for transfer pricing master file and Form 3CEB certification
- Power of Attorney for local representatives handling MCA, income tax, and GST filings — notarized and embassy-authenticated
Annual Documents
- Tax Residency Certificate from Vietnam's General Department of Taxation — renewed annually
- Form 10F — self-declaration filed with Indian tax authorities
- Digital Signature Certificate (DSC) — mandatory for electronic filing of income tax returns, GST returns, and MCA forms
Step-by-Step Tax Filing Process
Here is the structured tax filing process Beacon Filing follows for Vietnamese-owned Indian entities:
Step 1: Tax Registration and Setup
Obtain a Permanent Account Number (PAN) and Tax Deduction Account Number (TAN) from the Income Tax Department. Complete GST registration if aggregate turnover exceeds INR 20 lakh (INR 10 lakh for special category states). Procure Digital Signature Certificates for authorised signatories to enable e-filing on the income tax, GST, and MCA portals.
Step 2: Monthly GST Compliance
File GSTR-1 (outward supply details) by the 11th and GSTR-3B (summary return with tax payment) by the 20th of each month. Vietnamese parent companies providing services to the Indian subsidiary must evaluate reverse charge mechanism liability — import of services from Vietnam triggers GST at 18% on the Indian entity. File the annual GST return (GSTR-9) by December 31.
Step 3: Quarterly TDS Returns
Deduct TDS on all applicable payments — salaries (Form 24Q), payments to Indian residents (Form 26Q), and cross-border payments to the Vietnamese parent (Form 27Q). Apply the DTAA rate of 10% on dividends, interest, royalties, and FTS paid to the Vietnamese parent when valid TRC and Form 10F are on file. Deposit TDS by the 7th of the following month and file quarterly TDS returns by July 31, October 31, January 31 and May 31 (the January-March quarter return is due May 31).
Step 4: Advance Tax Payments
Pay advance tax in four quarterly instalments — 15% by June 15, 45% by September 15, 75% by December 15, and 100% by March 15. Non-payment or underpayment triggers interest under Sections 234B and 234C of the Income Tax Act.
Step 5: Annual Income Tax Return (ITR-6)
File ITR-6 on the income tax e-filing portal by October 31 (for companies subject to audit); the deadline is November 30 for companies required to file Form 3CEB in respect of international transactions with the Vietnamese parent. Include all income, deductions, TDS credits, advance tax payments, and foreign tax credit claims under the DTAA. Attach the tax audit report (Form 3CA/3CB and 3CD) if turnover exceeds INR 1 crore — the threshold rises to INR 10 crore only where both cash receipts and cash payments stay within 5% of the respective totals.
Step 6: Transfer Pricing Compliance
File the transfer pricing report (Form 3CEB) by October 31, certified by a Chartered Accountant. Maintain contemporaneous transfer pricing documentation covering all international transactions with the Vietnamese parent and other associated enterprises.
Timeline & Costs
Setup Timeline
| Activity | Duration |
|---|---|
| PAN and TAN registration | 5-7 business days |
| GST registration | 5-10 business days |
| Digital Signature Certificate | 2-3 business days |
| Tax compliance system setup | 3-5 business days |
| First return filing | Within applicable deadline |
Annual Compliance Calendar
| Filing | Frequency | Deadline |
|---|---|---|
| GST returns (GSTR-1, GSTR-3B) | Monthly | 11th and 20th of following month |
| TDS deposit | Monthly | 7th of following month |
| TDS returns (24Q, 26Q, 27Q) | Quarterly | July 31, Oct 31, Jan 31, May 31 |
| Advance tax instalments | Quarterly | June 15, Sep 15, Dec 15, Mar 15 |
| Income tax return (ITR-6) | Annual | October 31 (November 30 if Form 3CEB applies) |
| Tax audit report | Annual | September 30 |
| Transfer pricing report (3CEB) | Annual | October 31 |
| GST annual return (GSTR-9) | Annual | December 31 |
| FLA return to RBI | Annual | July 15 |
Cost Breakdown
| Service | Approximate Annual Cost |
|---|---|
| GST return filing (monthly) | INR 3,000 - 8,000/month (~$36-96) |
| TDS return filing (quarterly) | INR 2,000 - 5,000/quarter (~$24-60) |
| Income tax return (ITR-6) | INR 15,000 - 50,000/year (~$180-600) |
| Tax audit (Section 44AB) | INR 25,000 - 75,000/year (~$300-900) |
| Transfer pricing documentation | INR 1,00,000 - 3,00,000/year (~$1,200-3,600) |
| Advance tax computation | INR 10,000 - 25,000/year (~$120-300) |
Common Challenges for Vietnamese Companies
Document Authentication Transition Period
Vietnam acceded to the Hague Apostille Convention on 31 December 2025, but the convention will not enter into force until 11 September 2026. During this transition period, Vietnamese documents still require the full consular legalization process — notarisation, MFA attestation, and Indian Embassy authentication — which takes 4-6 weeks. Companies should plan well ahead of filing deadlines and prepare for the switch to apostille after September 2026.
Vietnam's CIT Compliance Impact on TRC
Vietnam updated its Corporate Income Tax (CIT) compliance requirements under Decree 320/2025, which affects how Vietnamese companies obtain tax documentation including Tax Residency Certificates. The Vietnamese parent must ensure its own CIT compliance is current with Vietnam's General Department of Taxation before requesting a TRC for DTAA claims in India. Delays in obtaining the TRC force the Indian subsidiary to deduct TDS at domestic rates.
Misaligned Financial Years
Vietnam follows a January-December financial year, while India mandates April-March. This creates overlapping reporting periods and compressed timelines, particularly when the Vietnamese parent needs Indian subsidiary data for its Q4 consolidation while the Indian entity is mid-year. Read our blog on 12 compliance deadlines foreign companies miss.
Reverse Charge GST on Vietnamese Parent Services
When the Vietnamese parent provides management, IT, or technical services to the Indian subsidiary, the Indian entity must self-assess and pay GST at 18% under the reverse charge mechanism. This is frequently missed by Vietnamese companies new to the Indian market, leading to interest at 18% per annum and potential penalties. See our guide on GST for foreign companies — 40 questions answered.
FEMA Compliance for Vietnamese-Owned Entities
Every inward remittance from the Vietnamese parent must be properly documented under FEMA regulations. The Indian entity must file the FLA return with the RBI by July 15 and Form FC-GPR on the RBI FIRMS portal (through the Single Master Form) within 30 days of share allotment; any transfer of shares between the Vietnamese parent and an Indian resident must be reported in Form FC-TRS within 60 days. ROC filing delays attract penalties of INR 50 to INR 5,00,000, and FEMA violations can result in penalties up to three times the transaction amount. Read our FEMA compliance guide for foreign companies.
Why Choose Beacon Filing
Beacon Filing specialises in tax filing for Vietnamese-owned Indian entities. Our team of Chartered Accountants handles all statutory filings — income tax, GST, TDS, advance tax, transfer pricing, and FEMA reporting — while optimising every intercompany payment for India-Vietnam DTAA benefits. We understand the specific challenges Vietnamese companies face in India, including the document authentication transition period, CIT compliance coordination, and the nuances of the Comprehensive Strategic Partnership between the two countries.
Schedule a free consultation to discuss your Indian subsidiary's tax filing needs, or explore our tax filing services for a complete overview.