OFFICIAL: STARTING FROM THE 2025 CORPORATE INCOME TAX PERIOD, TAX PERIODS OF LESS THAN 3 MONTHS ARE NO LONGER ALLOWED TO BE COMBINED

The Vinh Long Province Tax Office, Commune-Level Tax Office No. 10, has recently issued
an official statement on the corporate income tax (CIT) period applicable from the 2025 tax year onwards.
This is an important update for:

• Newly established enterprises in 2025;
• Enterprises changing their legal form or ownership structure;
• Enterprises undergoing consolidation, merger, division, separation, dissolution or bankruptcy.

1. Main legal basis

According to Clause 1, Article 5 of the Law on Corporate Income Tax No.67/2025/QH15 dated June 14, 2025
(Effective from October 1, 2025 and applicable from the 025 corporate income tax period):

Article 5. Tax Period
1. The enterprise income tax period shall be determined according to the calendar year or fiscal year selected by the enterprise, except for the case specified in Clause 2 of this Article. In case the enterprise chooses a fiscal year different from the calendar year, it shall notify the directly managing tax authority before implementation.

2. The tax period for enterprises specified at Points c and d, Clause 2, Article 2 of this Law shall comply with the law on tax administration.

In addition, pursuant to Point a, Clause 6, Article 10 Circular No.20/2026/TT-BTC dated 12 March 2026 of The Ministry of Finance:

Article 10. Enforcement effect
1. This Circular takes effect from March 12, 2026 and applies from the tax period of 2025.

6. This Circular replaces:
a) Circular No. 78/2014/TT-BTC of the Minister of Finance guiding the implementation of the Government’s Decree No.218/2013/NĐ-CP dated December 26, 2013 stipulating and guiding the implementation of the Law on Corporate Income Tax;
b) Circular No. 96/2015/TT-BTC dated June 22, 2015 of the Minister of Finance guiding corporate income tax in the Government’s Decree No. 12/2015/ND-CP dated February 12, 2015…

2. The previous regulations on combining tax periods are no longer effective

Based on the above provisions, Clause 3, Article 3 of Circular No.78/2014/TT-BTC
– which previously allowed:

• The first tax period, if shorter than 3 months, to be combined with the following year; or
• The final tax period, if shorter than 3 months, to be combined to form a single corporate income tax period,

has expired and no longer applies to the 2025 corporate income tax period.

3. Conclusion of the tax authorities

After reviewing the current corporate income tax policy framework, including:

• Law on Corporate Income Tax No.67/2025/QH15 dated 14 June 2025;
• Decree No.320/2025/NĐ-CP dated 15 December 2025;
• Circular No.20/2026/TT-BTC dated 12 March 2026;

The tax authorities concluded that:

From the 2025 corporate income tax period onwards, tax periods may no longer be combined with the following year in cases where the first tax period of a newly established enterprise or the final tax period of an enterprise is shorter than 3 months.

4. Which enterprises are affected?

This regulation directly affects the following cases:

• Enterprises newly established in 2025;
• Enterprises changing their business type;
• Enterprises changing their form of ownership;
• Enterprises undergoing consolidation or merger;
• Enterprises undergoing division or separation;
• Enterprises undergoing dissolution or bankruptcy.

If the above enterprises have a tax period shorter than 3 months,,
they must still determine a separate corporate income tax period and
may not combine it with the tax period of the following year.

5. Practical implications for accounting and enterprises

This is a very important change in the preparation of corporate income tax finalisation returns from 2025 onwards.
Enterprises should note the following:

• Do not continue applying the old regulations under Circular No.78/2014/TT-BTC;
• Review the dates of establishment, conversion, merger, division, separation or cessation of operations;
• Determine the correct separate corporate income tax period for any period of less than 3 months;
• Avoid errors that may lead to incorrect tax finalisation declarations, tax arrears or tax penalties.

6. Conclusion

From the 2025 corporate income tax period onwards:

• The mechanism for combining tax periods of less than 3 months with the following year no longer applies;
• Enterprises must prepare and finalise corporate income tax separately for the actual tax period incurred;
• The previous regulation under Clause 3, Article 3 of Circular 78/2014/TT-BTC is no longer effective.

Enterprises should proactively review their legal documents, establishment/conversion dates, and tax finalisation plans to ensure compliance with the new regulations.