TRANSFER OF PROFITS ABROAD FOR FDI INVESTORS

1. Legal Basis

Investment Law No. 143/2025/QH15 dated December 11, 2025;

Circular 186/2010/TT-BTC dated November 18, 2010, guiding the implementation of the transfer of profits abroad by foreign organizations and individuals earning profits from direct investment activities in Vietnam under the Investment Law.

2. What are profits transferred from Vietnam abroad

According to Clause 1, Article 2 of Circular 186/2010/TT-BTC, profits that foreign investor transfer from Vietnam abroad under this Circular are lawful profits distributed or earned from direct investment activities in Vietnam in accordance with the Investment Law, after fulfilling all financial obligations to the State of Vietnam as prescribed by law.

At the same time, Clause 2, Article 2 of Circular 186/2010/TT-BTC stipulates those profits transferred abroad can be in cash or in kind:

(i) Profits transferred abroad in cash must comply with foreign exchange management regulations.

(ii) Profits transferred abroad in kind must be converted to their monetary value in accordance with the laws on import-export of goods and other relevant legal regulations.

3. Timing of profit transfers abroad

There are two timing scenarios for transferring profits abroad, as prescribed in Clauses 1 and 2, Article 4 of Circular 186/2010/TT-BTC:

(i) Annual profit transfer

Foreign investors are entitled to transfer abroad the profits distributed or earned from direct investment activities in Vietnam at the end of each fiscal year, after the enterprise in which the foreign investor participates has fulfilled all financial obligations to the State of Vietnam as required by law, submitted audited financial statements, and filed the corporate income tax finalization declaration for the fiscal year to the relevant tax authority.

(ii) Profit transfer upon termination of investment activities in Vietnam

Foreign investors are entitled to transfer profits abroad when concluding their direct investment activities in Vietnam, after the enterprise in which they participate has fulfilled all financial obligations to the State of Vietnam as required by law, submitted audited financial statements, and filed the corporate income tax finalization declaration to the relevant tax authority, and fully complied with the obligations under the Tax Administration Law.

Accordingly, based on the above provisions, foreign investors may transfer profits abroad either annually at the end of the fiscal year or upon termination of their direct investment activities in Vietnam.

However, the condition for foreign investors to be permitted to transfer profits abroad is that the enterprise in which they invest must have fulfilled all financial obligations to the State of Vietnam as prescribed by law, submitted audited financial statements, filed the corporate income tax finalization declaration with the relevant tax authority, and fully complied with obligations under the Tax Administration Law (if any).

4. Determination of the Profits to be Transferred Abroad

For each timing of profit transfer abroad, the method of determining the amount of profit that may be transferred differs. Based on Article 3 of Circular 186/2010/TT-BTC, the provisions are as follows:

(i) For profits transferred abroad annually at the end of the fiscal year:

 The profits to be transferred are the profits distributed or earned by the foreign investor in the fiscal year from direct investment activities, based on the enterprise’s audited financial statements and corporate income tax finalization declaration, plus (+) other profits such as any undistributed profits carried forward from previous years, minus (−) profits that the foreign investor has used or committed to reinvest in Vietnam, or profits used to cover the foreign investor’s business expenses or personal needs in Vietnam.

Profits to be transferred abroad

=

Profits distributed or earned from the fiscal year’s investment activities

+

Other profits

-

Profits used or committed for reinvestment in Vietnam, and profits used to cover business expenses or personal needs

(ii) For profits transferred abroad upon termination of investment activities in Vietnam:

The profits to be transferred are the total profits earned by the foreign investor during the entire direct investment period in Vietnam, minus (−) profits already used for reinvestment, profits already transferred abroad during the investment period, and profits used for other expenses of the foreign investor in Vietnam.

Profits to be transferred abroad

=

Total profits earned during the investment in Vietnam

-

Profits used for reinvestment; Profits already transferred abroad during the investment period; Profits used for other expenses

*Note: Foreign investors are not allowed to transfer abroad profits distributed or earned from direct investment activities in Vietnam in a fiscal year if, according to the enterprise’s financial statements for that year, there is still a cumulative loss after loss carryforward in accordance with the corporate income tax law (Clause 3, Article 3 of Circular 186/2010/TT-BTC).

5. Procedures for Notifying the Transfer of Profits Abroad

Pursuant to Article 5 of Circular 186/2010/TT-BTC, foreign investors may either directly notify or authorize the enterprise in which they invest to notify the transfer of profits abroad using the form issued with this Circular. This notification must be submitted to the tax authority directly managing the enterprise at least 7 working days prior to the actual transfer of profits abroad.

Notification form: click here to download

The transfer of profits abroad for FDI investors is not only a right but also a responsibility to comply with Vietnamese law. Current regulations aim to balance the rights of investors with national interests, ensuring that the process of transferring profits is transparent and lawful, while also strengthening foreign investors’ confidence in Vietnam’s business environment. Understanding and properly implementing these regulations is a prerequisite for FDI investors to optimize business efficiency and simultaneously promote the sustainable development of Vietnam’s economy