Who must comply with Vietnam’s global minimum tax?

MNE groups with global consolidated revenue of at least €750 million in two of the last four years, including their Vietnamese entities.

Will tax incentives in Vietnam still apply?

Incentives may still exist, but if they reduce the effective tax rate below 15%, a top-up tax will apply under the global minimum tax rules.

Who pays the top-up tax?

Either the Vietnamese entity pays it locally under QDMTT, or the parent company pays it under the Income Inclusion Rule, depending on the group structure.

What should companies do now?

Assess whether the group is in scope, identify the filing entity in Vietnam, prepare global tax data early, and seek professional advice to avoid compliance risks.

Global Minimum Tax in Vietnam: A 2026 Practical Guide

KEY TAKEAWAYS

Tax authorities will focus on actual profits and effective tax rates, not on preferential tax incentives or nominal corporate tax rates.

Multinational groups with consolidated revenue of €750 million or more must ensure their Vietnam profits are taxed at an effective rate of at least 15%.

The main challenge is managing data, calculations, and filings across jurisdictions. Errors or delays can trigger penalties even if no additional tax is ultimately due.

The global minimum tax (GMT) is a new international tax reform under OECD’s Pillar Two, aimed at preventing profit shifting and ensuring multinationals pay at least a 15% tax on income in each country they operate. Vietnam has joined this movement through Resolution 107/2023/QH15 (effective Jan 1, 2024) and its implementing Decree 236/2025/ND-CP (effective Oct 15, 2025). In practice, this means large multinational enterprise (MNE) groups with consolidated revenues ≥€750 million (in 2 of the last 4 years) must comply with Vietnam’s GMT rules. This blog explains what the global minimum tax is, why Vietnam adopted it, which companies are affected, and how local entities can prepare.

What is the Global Minimum Tax?

The global minimum tax is an international rule that sets a floor for corporate tax rates worldwide. Put simply, each large multinational group must pay at least a 15% effective tax rate on profits in every jurisdiction. This reform was agreed by the OECD and G20 to curb profit-shifting: by taxing profits where economic activity happens, it closes loopholes that let firms use tax havens to lower their overall tax bills . In effect, the global minimum tax (often called “Pillar Two” or GMT) levels the playing field so that companies like Apple, Samsung or Microsoft can’t escape tax simply by booking profits in a low-rate country.

Vietnam’s national authorities see GMT as a way to modernize the tax system and protect revenue. The Vietnamese government noted that about 100 large foreign-invested companies (e.g. Samsung, Intel, LG) were benefiting from special tax incentives, sometimes paying as little as 12% or less . By enforcing a 15% minimum, Vietnam expects these companies to pay more tax when their effective rate is below 15%, boosting public funds . In fact, the 2023 tax resolution explicitly targets MNEs with low-taxed subsidiaries and mandates that their tax rate be “brought up” to 15%.

Why Vietnam Adopted the Global Minimum Tax

Vietnam’s current statutory corporate tax rate is 20%, but generous incentives have often reduced foreign firms’ effective rates well below that. Vietnam joined the OECD Inclusive Framework on BEPS and committed to the Pillar Two standard. In November 2023, the National Assembly passed Resolution 107/2023/QH15, announcing GMT rules effective from 2024 . This aligned Vietnam with a global trend: by 2025 more than 50 countries have introduced GMT measures.

The practical goal is twofold: fairness and revenue. Fairness – because all big companies will now pay at least 15%, preventing them from undercutting local firms that pay higher taxes. Revenue – because the state can capture additional tax on profits formerly sheltered by incentives. Vietnamese authorities expect this GMT regime to significantly increase tax collection without raising the base rate, by adjusting the tax liabilities of low-taxed firms upward .

Furthermore, Vietnam has set up two mechanisms – the Income Inclusion Rule (IIR) and the Qualified Domestic Minimum Top-up Tax (QDMTT) – to integrate GMT into its tax system . The goal is that either Vietnam itself collects extra tax on its domestic affiliates (via QDMTT) or leaves it to the parent company to pay the top-up back to Vietnam (via IIR).

Who Must Comply with Vietnam’s GMT?

Under Vietnam’s rules, an MNE group is in-scope if global revenues ≥ €750 million in at least two of the previous four years. This is exactly the OECD threshold. Practically, any large multinational operating in Vietnam – e.g. a foreign-owned factory or parent company in VN – must check if its global group meets this threshold. If yes, the GMT rules apply to the group and to all its Vietnamese constituent entities.

However, certain entities are excluded. Vietnam’s law follows OECD guidance: government bodies, international or non-profit organizations, pension funds, investment funds (if they are ultimate parents), real estate investment organizations (as ultimate parents), and firms majority-owned (≥85%) by such entities are exempt. Essentially, these common “public good” or investment vehicles are carved out. All other large corporate groups are subject.

In summary, if your Vietnam-based company is part of a global MNE earning €750m+ (e.g. a Vietnamese manufacturing subsidiary of a listed MNE), you will fall under the new global minimum tax regime. Your company will either need to pay a domestic top-up tax (QDMTT) or the group’s parent will pay it via IIR, depending on the situation.

Key Mechanisms: Income Inclusion Rule and QDMTT

Vietnam’s GMT framework centers on two rules:

Qualified Domestic Minimum Top-up Tax (QDMTT): If a Vietnamese subsidiary of a foreign MNE pays effective tax below 15%, Vietnam can impose a top-up tax to reach 15%. In other words, Vietnam collects the “gap” up to 15% on profits earned in Vietnam. This keeps revenue in Vietnam and ensures the local unit’s tax rate meets the minimum. For example, if a Vietnam factory reports $10 million in profit but only paid 12% CIT, Vietnam can levy an additional 3%×$10M = $300k under QDMTT.
Income Inclusion Rule (IIR): This affects the parent company of the MNE. The ultimate (or intermediate) parent must include in its Vietnamese taxes a top-up for any foreign subsidiary whose tax rate is below 15%. In practice, the parent calculates the difference between 15% and the subsidiary’s actual tax rate, then pays that difference on the subsidiary’s profit share. For instance, if a Vietnamese parent owns 80% of a subsidiary in a zero-tax jurisdiction with $100M profit, the parent would pay (15% – 0%)×$100M×80% = $12M to Vietnam to raise the subsidiary’s ETR to 15%.

Together, QDMTT and IIR ensure Vietnamese tax authorities can collect the global minimum tax either at home or via the parent group . If the top-up tax is paid domestically under QDMTT, the parent won’t owe that portion under IIR (to prevent double-taxation). Vietnam’s GMT rules are explicitly designed to fit the OECD model. As KPMG notes, Decree 236/2025 provides “detailed guidance on the implementation of the Pillar Two global minimum tax rules,” covering both IIR and QDMTT.

Compliance and Filing Requirements

Affected companies must file special GMT returns annually. The core obligation is to prepare a GloBE information return and calculate any top-up tax. This requires detailed worldwide data: net income and covered taxes for each country, reconciled from the consolidated financial statements of the ultimate parent. Companies must also explain any differences between local accounting and the international standards used for GMT calculations.

Key practical points and deadlines are:

One Constituent Entity (CE) files: If an MNE group has multiple Vietnamese affiliates (CEs), it must nominate one CE (typically the largest) to be the reporting entity. If the group fails to nominate, the tax authority will appoint the one with the largest assets . The designated CE uses a special tax code for GMT reporting and payment.
Deadlines:
QDMTT: The return (with calculation of domestic top-up) is due 12 months after the fiscal year-end. For example, for FY2024 ending 31-Dec-2024, the GMT return is due by 31-Dec-2025.
IIR: In the first year only, the IIR return (showing any foreign top-up) is due 18 months after year-end; in subsequent years, the deadline is 15 months after year-end . So a FY2024 parent must file by mid-2026, but FY2025 by end of Q1/2026, etc.

These deadlines match Resolution 107 and Decree 236 guidelines. KPMG and Alvarez & Marsal both highlight these 12/15/18 month timing rules . It’s vital to note: the very first returns under Vietnam’s GMT may be filed in late 2025 or mid-2026 even though they cover FY2024.

Safe Harbor and Transitional Relief: To ease the impact, Vietnam provides transition rules. During the initial transition period (FY2023–FY2026), an MNE group owes no additional GMT tax if it meets any of these safe-harbor tests: total revenue <€10 million and profit <€1 million, or the group’s simplified effective tax rate is at least 15% (for FY2023–24), then 16% (FY2025), 17% (FY2026). In effect, small groups or those already near the target ETR pay nothing extra initially. Additionally, no top-up tax is due if a jurisdiction’s profit is entirely covered by the allowed “substance-based” carve-out (e.g. payroll and tangible assets) per the OECD formula.
Penalties: For the initial years, Vietnam offers penalty relief for minor compliance delays. For example, late submission of the notification to appoint a filing CE or late tax registration (up to 90 days) may not incur penalties during transition. However, after the transition window ends, usual penalties (fines, interest) will apply to missing GMT filings or underpayment.

In summary, to comply with Vietnam’s global minimum tax, a company must gather global financial data, track deadlines closely, and ensure the GMT returns (information and tax returns) are filed as required. Documentation is key: firms need a thorough written explanation of any discrepancies between Vietnam’s accounting standards and the IFRS/IAS used for GMT calculations . The General Department of Taxation will oversee enforcement, so accuracy and transparency are critical.

Practical Steps for Vietnamese Companies

Determine Applicability: Check if your MNE group’s global consolidated revenue exceeds €750M (in 2 of last 4 years). If yes, your firm is likely covered by GMT rules. This applies even if your parent is foreign.
Choose a Filing Entity: If you have more than one legal entity in Vietnam, decide which will be the filing Constituent Entity (CE). File the 30-day notification with tax authorities nominating this CE by 30 days after year-end.
Register for GMT: Apply for a special GMT tax code within 90 days after fiscal year-end (or by Jan 13, 2026 if your FY2024 ended before June 30, 2025). This code is used for all GMT filings.
Gather Data: Compile the required global income and tax data for each CE. Use the ultimate parent’s consolidated financials as the baseline (converted to VND if needed) to compute “GloBE income” and “covered taxes.”
Calculate Top-up Tax: For each CE: compare actual covered taxes to the 15% benchmark on GloBE income. If the effective rate is below 15%, calculate the top-up = (15% – ETR) × profit (minus allowed carve-outs). This top-up is your QDMTT liability. Separately, the parent will compute any IIR top-up based on its ownership share.
File Returns: Submit the GMT information return and tax return by the due dates (12 or 15/18 months). The filing package includes: an information return, top-up tax return, a report of each CE’s financials, and explanations for accounting differences . For QDMTT, attach the statement of local top-up tax. For IIR, include the consolidated financials of the ultimate parent and any foreign top-up calculations.
Pay the Tax: If your CE owes QDMTT, pay it within the 12-month window. If the parent owes IIR top-up attributable to Vietnam’s subsidiaries, arrange payment through the CE’s GMT code.
Claim Safe Harbors if Applicable: If your group qualifies for the transition exemptions (low revenue/profit or the simplified ETR path), document this carefully – even if no top-up is due, you still file returns (showing the calculation) to claim the exemption.
Consult Specialists: Because GMT is complex and new, consider hiring tax advisors or using specialized software. Getting the calculation right – especially the adjustable items like substance carve-out – can be intricate. The Vietnamese government encourages taxpayers to seek professional guidance on GMT implementation.

Example: Suppose Company A (Vietnam) is part of an MNE that earned €1 billion globally, so it meets the GMT threshold. In FY2024, A’s Vietnamese net profit was VND 100 billion and it paid VND 12 billion in CIT (12% ETR). Under GMT, A’s effective rate must reach 15%. The top-up tax is (15%–12%)×100bn = VND 3 billion. A would file a QDMTT return (due by year-end 2025) and pay VND 3 billion extra. The parent company would not need to pay any IIR top-up for these Vietnam earnings, since Vietnam collected the full 15% locally.

Conclusion

Vietnam’s adoption of the global minimum tax marks a major shift for large businesses. In essence, the new rules ensure that multinational enterprises cannot use Vietnam’s incentives to escape the 15% floor set by the OECD’s Pillar Two framework . Companies with a Vietnamese presence must now be prepared for additional reporting and potential tax bills if their effective rate falls below 15%.

To navigate the global minimum tax, Vietnamese entities should start preparing now: review group revenue and structure, collect necessary financial data, and plan for new filings. With careful planning and professional advice, businesses can comply smoothly. Ultimately, the global minimum tax aims to make Vietnam’s tax system fairer and more transparent, ensuring that all large multinationals contribute a baseline amount to the economy .