Vietnam’s government issued a decree (Decree No. 255) on 30 June 2026 that makes changes to the administration of transactions between affiliated enterprises. Decree 255, which replaces two previous decrees (Decree No. 132/2020/ND-CP and Decree No. 20/2025/ND-CP), took effect on 1 July 2026 and applies from the 2026 corporate income tax year.
Although Vietnam’s transfer pricing framework remains broadly unchanged, Decree 255 introduces several important updates. These include changes to the related party definition, relaxed conditions to qualify for an exemption from transfer pricing documentation, expanded benchmarking database rules, and clarification of the country-by-country reporting (CbCR) requirements and circumstances that may trigger transfer pricing adjustments.
The key changes are summarised below.
Decree 255 generally retains the related party definitions under Decrees 132 and 20, but it introduces an important clarification for certain state-owned lenders or guarantors.
Under Decree 255, a 100% state-owned lender or guarantor whose functions include purchasing, selling and handling debts will not be regarded as a related party of the borrower or guaranteed entity if the lender or guarantor does not directly or indirectly participate in the management, control, capital contribution or investment activities of those enterprises.
Decree 255 increases the revenue threshold for the transfer pricing documentation exemption criterion from VND 200 billion to VND 500 billion. Specifically, taxpayers that do not generate revenue or incur expenses from the exploitation or use of intangible assets are exempt from preparing transfer pricing documentation if their annual revenue is below VND 500 billion. Decree 255 also removes the requirement that an entity qualify as a “simple-function entity” to qualify for the exemption, which should help to reduce ambiguity and simplify the practical application of the exemption rules.
Decree 255 expands and provides a hierarchy of data sources for benchmarking purposes. These include:
This hierarchy may affect how taxpayers select and support comparable data in transfer pricing analyses.
Decree 255 introduces several amendments to Vietnam’s CbCR requirements, including the following:
Decree 255 adds a circumstance under which tax authorities may adjust transfer prices, profit margins, taxable income, etc., i.e., an incorrect declaration of information in Appendix I, which covers related party relationships and related party transactions, is now considered a circumstance that may give rise to transfer pricing adjustments by the Vietnamese tax authorities.
Taxpayers should review Appendix I disclosures carefully to ensure consistency with their transfer pricing documentation and related-party transaction reporting.
Decree 255 does not fundamentally alter Vietnam’s transfer pricing regime, but it introduces several practical changes that taxpayers should consider when preparing documentation and evaluating reporting obligations for the 2026 corporate income tax year.
In particular, taxpayers should review whether they may benefit from the expanded documentation exemption threshold, reassess their benchmarking approaches in light of the prescribed data-source hierarchy and evaluate whether their CbCR filing or notification obligations have changed.
Where further guidance is required, particularly in situations involving significant tax exposure or uncertainty, taxpayers may wish to seek formal clarification from the relevant tax authorities.
Hillary Vu
BDO in Vietnam
Although Vietnam’s transfer pricing framework remains broadly unchanged, Decree 255 introduces several important updates. These include changes to the related party definition, relaxed conditions to qualify for an exemption from transfer pricing documentation, expanded benchmarking database rules, and clarification of the country-by-country reporting (CbCR) requirements and circumstances that may trigger transfer pricing adjustments.
The key changes are summarised below.
Related Party Definitions
Decree 255 generally retains the related party definitions under Decrees 132 and 20, but it introduces an important clarification for certain state-owned lenders or guarantors.Under Decree 255, a 100% state-owned lender or guarantor whose functions include purchasing, selling and handling debts will not be regarded as a related party of the borrower or guaranteed entity if the lender or guarantor does not directly or indirectly participate in the management, control, capital contribution or investment activities of those enterprises.
Expanded Documentation Exemption Threshold
Decree 255 increases the revenue threshold for the transfer pricing documentation exemption criterion from VND 200 billion to VND 500 billion. Specifically, taxpayers that do not generate revenue or incur expenses from the exploitation or use of intangible assets are exempt from preparing transfer pricing documentation if their annual revenue is below VND 500 billion. Decree 255 also removes the requirement that an entity qualify as a “simple-function entity” to qualify for the exemption, which should help to reduce ambiguity and simplify the practical application of the exemption rules.
Databases for Benchmarking Analysis
Decree 255 expands and provides a hierarchy of data sources for benchmarking purposes. These include:
- Publicly available information and data, including information published on securities markets, domestic and international exchanges of goods and services, national databases and disclosures by domestic ministerial agencies or other official sources;
- Commercial databases; and
- Tax administration databases, including the tax authorities’ internal database.
This hierarchy may affect how taxpayers select and support comparable data in transfer pricing analyses.
CbCR Reporting Requirements
Decree 255 introduces several amendments to Vietnam’s CbCR requirements, including the following:
- Updated revenue threshold: A Vietnamese ultimate parent company (UPC) is required to prepare and submit a CbCR if its consolidated global revenue in the preceding fiscal year equals or exceeds EUR 750 million. This replaces the previous threshold of VND 18 trillion, which was based on the reporting tax year.
- Filing obligations for taxpayers with a foreign UPC: Decree 255 clarifies local CbCR filing obligations and deadlines for Vietnamese taxpayers whose UPC is located overseas.
- CbCR notification requirements: Decree 255 supplements the specific circumstances under which CbCR notifications must be filed.
- Prescribed filing format: CbCRs must be submitted electronically in encrypted XML format.
- Conditions for local CbCR filing: Local CbCR submission is required only following an official announcement by the tax authorities confirming Vietnam's compliance with international standards on data confidentiality, consistency and appropriate use.
Additional Circumstances Subject to Transfer Pricing Adjustments
Decree 255 adds a circumstance under which tax authorities may adjust transfer prices, profit margins, taxable income, etc., i.e., an incorrect declaration of information in Appendix I, which covers related party relationships and related party transactions, is now considered a circumstance that may give rise to transfer pricing adjustments by the Vietnamese tax authorities.Taxpayers should review Appendix I disclosures carefully to ensure consistency with their transfer pricing documentation and related-party transaction reporting.
BDO Perspective
Decree 255 does not fundamentally alter Vietnam’s transfer pricing regime, but it introduces several practical changes that taxpayers should consider when preparing documentation and evaluating reporting obligations for the 2026 corporate income tax year.In particular, taxpayers should review whether they may benefit from the expanded documentation exemption threshold, reassess their benchmarking approaches in light of the prescribed data-source hierarchy and evaluate whether their CbCR filing or notification obligations have changed.
Where further guidance is required, particularly in situations involving significant tax exposure or uncertainty, taxpayers may wish to seek formal clarification from the relevant tax authorities.
Hillary Vu
BDO in Vietnam