Vietnam transfer pricing decree 2026: A deep dive into the new regulatory framework

• The Decree supplements regulations regarding related-party relationships established through borrowing and lending arrangements, mirroring the provisions on loans and lending set forth in Point l, Clause 2, Article 5: “An enterprise with transactions involving the transfer or receipt of capital contributions of at least 25% of the owner’s contributed capital of the enterprise in the tax period; lending, loans of at least 10% of the owner’s contributed capital at the time the transaction arises in the tax period, with individuals who manage or control the enterprise or with individuals with relationships as prescribed in point g of this clause;”
• Previously, there were no regulations defining the related-party relationship arising from the borrowing or lending transactions between an enterprise and an individual who manages or controls it – or an individual falling within the aforementioned relationships.
• The Decree also supplements cases where regulations on related-party relationships do not apply: “The creditor or guarantor is an organisation wholly owned by the State with the function of purchasing, selling and handling debts, which does not directly or indirectly participate in the management, control, capital contribution or investment in the debtor enterprise or the guaranteed enterprise under points a and c of this clause.”

A notable enhancement is the introduction of a prescribed hierarchy for selecting data sources used in comparability analyses, with the following order of priority:

• Public or official sources, including stock exchange data, commodity/service exchanges, national databases and other publicly available official sources
• Commercial databases
• Tax authority databases

The Decree supplements and clarifies the cases in which taxpayers are not required to submit a country-by-country report (CbCR) in Vietnam, including:

• The CbCR has been automatically exchanged with the Vietnamese tax authority pursuant to an agreement between competent authorities
• Cases where an entity submits the CbCR on behalf of others and fully meets the conditions for applying this mechanism
• Cases involving discrepancies in revenue thresholds, currency conversion, or revenue determination principles across different countries or territories

The government has supplemented regulations regarding the format and method of submission for the CbCR. Specifically:

• The CbCR shall be filed in encrypted XML format
• The CbCR shall be filed through the Tax Administration Information System

At the same time, Clause 6, Article 19 of the Decree stipulates that the exchange rate for determining the consolidated revenue threshold shall be the central exchange rate or the average cross-rate for December of the year immediately preceding the reporting year, as published by the State Bank of Vietnam.

Pursuant to Clause 1, Article 19 of the Decree, entities with consolidated global revenue of EUR 750 million or more in the fiscal year immediately preceding the reporting year are required to prepare and submit a CbCR to the tax authority. (Previous threshold: VND 18 trillion, VND = Vietnamese dong, VND 100,000 is the equivalent of around USD 3.80).

This Decree refines the framework for transfer pricing documentation (TPD) exemptions, including:

• An increase in the revenue threshold for the exemption from preparing TPD under the prescribed profitability safe harbour rules (from VND 200 billion to below VND 500 billion in specific cases)
• The removal of qualitative criteria such as “simple functions” when assessing eligibility under the same regime