FDI Enterprises In Vietnam: A Roadmap For Legal – Tax – HR – Accounting Setup

Vietnam is becoming one of the leading destinations in Asia for foreign investors thanks to its competitive costs, abundant workforce, and increasingly transparent business environment. However, to successfully establish operations, enterprises need not only capital but also a well-structured implementation roadmap from the outset.

One of the most common questions from FDI investors is: where should they start—legal, tax, HR, or accounting? The answer is not choosing a single element, but building an integrated foundation where each step is closely interconnected.

1. Legal – The Mandatory Foundation to Start

Legal setup is always the first and most critical step, as without completing legal procedures, an enterprise cannot officially operate in Vietnam.

Enterprises need to:

• Obtain an Investment Registration Certificate (IRC) for foreign investors
• Establish the company and obtain an Enterprise Registration Certificate (ERC)
• Register appropriate business lines
• Open a Direct Investment Capital Account (DICA)

Choosing the right business structure and investment model from the beginning will directly impact tax obligations, operational structure, and future scalability.

2. Tax – Early Setup to Avoid Risks

Immediately after completing legal procedures, enterprises should establish their tax system to ensure compliance and avoid errors from the initial stage.

Key tasks include:

• Register for a tax identification number and activate tax obligations
• Register tax declaration methods (VAT, CIT, PIT)
• Register for e-invoice usage
• Establish periodic tax filing and payment processes

Delays or incorrect setup at the beginning may lead to:

• Administrative penalties
• Incorrect tax obligations
• Difficulties in making adjustments later

3. Human Resources (HR) – The Core Operational Element

In parallel with tax setup, enterprises need to build their HR foundation to ensure smooth operations.

Key areas include:

• Signing labor contracts in compliance with regulations
• Developing salary scales and payroll structures
• Registering for social insurance and health insurance
• Establishing payroll and personal income tax (PIT) processes

For FDI enterprises, compliance with Vietnamese labor regulations not only mitigates legal risks but also helps build a stable and professional working environment.

4. Accounting & E-invoicing – Financial Control System

Accounting and e-invoicing are essential for transparent operations and meeting tax authority requirements.

Enterprises need to:

• Select accounting software compliant with Vietnamese standards
• Set up the chart of accounts
• Register and implement e-invoicing
• Establish revenue and expense recognition processes

Notably, under current regulations, enterprises must:

• Not cancel e-invoices
• Handle errors through adjustment or replacement invoices
• Ensure data connection with tax authorities

A properly established accounting system will help:

• Control cash flow
• Support audits and group reporting
• Minimize tax risks

5. Where Should You Start?

Instead of implementing each function separately, enterprises should adopt a synchronized and logical approach:

• Start with legal setup to obtain operational status
• Simultaneously establish tax and accounting systems right after incorporation
• Implement HR in parallel to support operations
• Integrate all systems to ensure data consistency

This approach helps enterprises:

• Save time
• Avoid multiple adjustments
• Ensure compliance from the beginning

Establishing operations in Vietnam is not just about completing incorporation procedures, but about building a comprehensive operating system covering legal, tax, HR, and accounting. For FDI enterprises, a well-structured foundation from the start helps minimize risks, optimize costs, and facilitate future expansion.

TPM Support Services

For enterprises seeking comprehensive advisory and implementation support when entering Vietnam, TPM offers a full suite of services, including:

Corporate Structure & Licensing

• Advisory on business structure selection (LLC, JSC)
• Charter capital planning and capital contribution roadmap

Vietnam Tax System Overview

• Key taxes: CIT, VAT, PIT, FCT
• Tax incentives
• Global Minimum Tax (Pillar Two)

Labor & HR Compliance

• Employment contracts & salary structure
• Work permit & Temporary Residence Card (TRC)

Accounting & Invoicing System

• Overview of VAS & differences vs IFRS
• E-invoice regulations
• Accounting records & mandatory reports

With extensive experience supporting FDI enterprises, TPM is committed to accompanying businesses from incorporation to stable operations and expansion in the Vietnamese market.

In case you need further consultation, please contact TPM via our website or hotline (+84) 28 3505 1800 for prompt support.

Thao Phung