# Infographic on major steps to start a business in Vietnam
# Working with local lawyers while making your plan to do business in Vietnam
Starting a business in overseas countries in general, and in Vietnam in particular isn't easy and cheap. Have yourself good Vietnamese lawyers who can explain the complex local requirements, and provide useful advice. They can help you have an overview of the matters that directly impact your time and your business. Hence, you may have a better and more practical business plan.
# Company registration is the first thing to start a business
Registering a Vietnamese legal entity brings foreign investors many benefits. Theoretically, Vietnamese-owned companies and foreign-owned companies are treated equally on tax rates, tax obligations, government incentives and protections, etc.
In order to set up a company, foreign investors must lease a location as a company headquarter in advance. They also need to prepare their financial proves such as personal bank statement, or financial statements with profits. A specific business plan is required to submit for authority review. It must show the tentative investment objectives, scale, capital, location, duration, implementation schedule, project's socio-economic impact and efficiency, preliminary environmental impact assessment (if any).
Nova Law is trusted by many foreign startups in Vietnam. We provide one-stop licensing and legal services. The registration process will be smoother with our support. Please connect with our lawyers for FREE CONSULTATION.
# Open bank accounts
After establishing, a foreign-owned company must open a Direct Investment Capital Account using to transfer capital inbound and outbound of Vietnam. The charter capital needs to fully contribute within 90 days since the company establishment date. Payment bank accounts can be used for daily business activities and tax payments.
# Accounting and taxes
Taxes: Most companies in Vietnam will be affected by the following taxes:
- Corporate Income Tax: 20%. Tax incentives could be granted to new investment projects based on regulated encouraged sectors, encouraged locations and the size of the project;
- Value-Added Tax: 0%, 5% or 10% depends on goods or services. The VAT can be calculated base on the deduction method or the direct method;
- Personal Income Tax of Vietnamese and expatriate employees: Employment income is taxed on a progressive tax rate basis. Other taxable income is at a variety of different rates;
- Social insurance, unemployment insurance, and health insurance contributions: commonly, the Employer shall pay from up to 21,5% and the Employee pay from 10,5% per gross income of the Employee;
- Export and Import Duties.
Accounting period: The accounting period is generally 12 months in duration. Companies shall declare tax on a quarterly basis.
Audit Requirements: The annual financial statements of the foreign-owned companies shall be audited by an independent auditing firm operating in Vietnam
Invoicing: Recently, companies in Vietnam are converting from paper invoice system to invoice system with huge advantages like save cost and time on printing, filling, delivery, and more safe and precise.
# Visa and work permit
Foreign investors may apply for investor visas of Vietnam (DT Visa) with terms from 3 months to 1 year. Those who want to stay for a longer duration may apply for temporary resident cards (TRC) with terms from 1 year to 5 years.
A work permit is granted for foreigners who come to Vietnam for working purposes. The duration of a work permit is 2 years and can be extended.
In practice, the process and requirements to apply for visas and work permits are complicated and difficult to complete without the support of local service agents.
# About Nova Law
Nova Law is a legal consulting firm based in Hanoi, Vietnam. We focus on providing legal and licensing services for foreign investors during their path of doing business in Vietnam. WE HAVE:
- Well-experienced lawyers with years working on foreign investment consulting, have been cooperating with a wide range of clients: from multinational corporations, factories, service companies, to small startups;
- Professional service quality, with high standards in detailed works and professional ethics;
- Vietnamese lawyers who are familiar with Vietnamese laws on investment and corporate, and always maintained strong relationships with the ministries and provincial authorities. So as the licensing process or consulting for difficult cases will be conducted more smoothly.