Managing Payment & Payroll Risks

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Non-cash Payment Compliance: Notable Expenses Every Business Should Know

For Vietnamese enterprises, including foreign-invested enterprises, the recent update under Decree 320/2025/ND-CP dated 15 December 2025 introduces important refinements to corporate income tax (CIT) deductibility requirements, particularly in relation to non-cash payment conditions.

The notable change is the reduction of the non-cash payment threshold from VND 20 million to VND 5 million. As a result, several example expenses below may be impacted and should be carefully reviewed by enterprises.

1.      Business trip

Business trip expenses for employees (domestic and overseas) of VND 5 million or more may be considered deductible, even if the payment is initially made by the employee using non-cash payment methods, with certain conditions, for example:

• valid invoices and supporting documents are obtained according to accounting and invoicing regulations;
• company decision or assignment letter confirming the employee’s business trip;
• the company’s financial regulations or internal policies permit employees to temporarily advance travel-related expenses and subsequently be reimbursed by the company via non-cash payment.

2.      Salary payments

Based on guidance provided in several Official Letters by the Tax Authorities, salary payments of VND 5 million or more made without valid non-cash payment evidence may not be considered as deductible expenses for CIT purposes. Enterprises should ensure that salary payments exceeding this threshold are supported by appropriate non-cash payment documents to avoid potential tax exposure.

Contributed by RÖDL Vietnam

The Hidden Cost of Getting Payroll Wrong in Vietnam

Payroll issues are often underestimated, not because they are particularly complex, but because the consequences usually appear much later.

This is especially relevant for FDI companies with expatriate or cross-border payroll arrangements. In practice, many situations do not initially seem problematic. A benefit may be handled differently between employees, an expat package may gradually change over time, or the employment contract may not fully reflect how payments are actually made.

Over time, these differences start to build up. Companies often only notice them when payroll data is reviewed by tax, labor, or social insurance authorities. By then, the issue is no longer only administrative. Historical payroll records may need to be revisited, and the financial impact can extend across multiple periods.

With the implementation of Vietnam’s electronic labor contract framework under Decree 337/2025/NĐ-CP and the broader digitalization of employment records, it is becoming easier for authorities to compare payroll-related information across systems.

For companies operating in Vietnam, keeping employment contracts, payroll records, and tax reporting aligned is becoming increasingly important to avoid unnecessary exposure later on.

Contributed by RÖDL Vietnam