Can the quarantine fees be included in the company's deductible expenses?

Questions: Due to the COVID-19 pandemic, our Company has paid the quarantine fees for foreign employees when they enter Vietnam. So my question is: When foreign employees enter Vietnam to work, can the fees for quarantine and treatment (if any) be included in the company’s deductible expenses?

Answer: PL&Partners would like to thank you for trusting and sending questions to us. Regarding your question, we would like to reply as follows:

On November 26, 2020, the General Department of Taxation issued Dispatch No. 5032/TCT-CS which contains the answer to this issue. Specifically:

“For the cost of quarantine at the hotel for foreign experts, in case the enterprise signs a labor contract with the employee in which the expenses for housing paid by the enterprise to the employee are recorded, the expense paid to the quarantine facility shall be included in deductible expenses when determining taxable income if there are sufficient invoices, documents, and payment as prescribed.”

Thereby, if the labor contracts of your Company and the foreign employees have the term expressing that the expenses for housing of the employee shall be paid by the employer, and your Company has sufficient invoices, documents, and payment, then such expenses shall be included in the company’s deductible expenses.