According to Vietnamese law, we can operate a coffee shop, milk tea shop under many types of business registration such as: limited liability company, joint stock company, etc. However, the common form. The most registered by the majority of shop owners when running a coffee shop business is: individual business households. So What taxes must be paid when opening a coffee shop in Vietnam? The following article of Lawyer X will share with you the legal provisions on the above content. Hope this article brings you many useful things.
Legal grounds
Decree No. 01/2021/ND-CP;
Circular 92/2015/TT-BTC.
Opening a coffee shop requires a business registration
Pursuant to Clause 2, Article 79 of Decree No. 01/2021/ND-CP, cases where household business registration is not required include: Households engaged in agricultural, forestry, fishery, salt production and street vendors, snacks, business trips, mobile businesses, seasonal businesses, low-income services.
However, if doing in conditional business lines and professions, the above subjects still have to register their business according to regulations.
In addition, at Point dd, Clause 1, Article 3 of Decree 39/2007/ND-CP, the government explains that individuals engaged in commercial activities are individuals who personally carry out one, several or all of the activities on a daily basis. An activity permitted by law in terms of buying and selling goods, providing services, etc., which is profitable but not required to be registered for business, is not called a “trader” including:
– Street vendors, small businesses, junk food sales, trip traders;
– Performing the services of shoe shine, lottery ticket sales, lock repair, car repair, parking, car wash, haircut, painting, photography and other services with or without a fixed location;
– Commercial activities independently, often without other business registration.
A coffee shop is a food service establishment with a specific business location, so a coffee shop is required to register a business.
Tax when opening a coffee shop
Whether it’s a large or small coffee shop, there are taxes to be aware of. According to Article 2, Circular 92/2015/TT-BTC, taxes that coffee shop businesses need to pay include:
Taxes/license fees
License fee is the tax payable annually or when the enterprise is new to production and business based on the charter capital in the business registration certificate/investment capital stated in the investment registration certificate (for organizations) or revenue of the year (for business households and individuals).
License fees for business households are as follows:
– revenue over 500 million VND/year: 1,000,000 VND/year;
– revenue over 300 to 500 million VND/year: 500,000 VND/year;
– revenue over 100 to 300 million VND/year: 300,000 VND/year;
– turnover under 100 million VND/year: exempted.
License tax rates for businesses:
| Charter capital or investment capital | License tax rate |
| Over VND 10 billion VND | 3,000,000 VND/year |
| From VND 10 billion or less | 2,000,000 VND/year |
| – Branch – Representative office – Business location – Career unit – Other economic organizations | 1,000,000 VND/year |
Value Added Tax
Value Added Tax (VAT) is an indirect tax and is charged on the added value of goods and services arising from the production and circulation process until they reach consumers.
Because it is an indirect tax, the cafe only pays this tax on behalf of the customer to the state agency. Taxpayers are actually consumers.
Circular 219/2013/TT-BTC stipulating the VAT rate is 10%.
Circular 92/2015/TT-BTC guiding the payment of value added tax as follows:
Amount of VAT payable = VAT revenue x VAT rate.
Personal income tax
Personal income tax is a tax that businesses pay on behalf of employees. This tax is calculated on a monthly basis, declared monthly or quarterly, but settled annually.
PIT payable is PIT revenue x PIT rate
For coffee shop business, the PIT rate is 1%.
In case the cafe’s turnover is less than 100 million/year, VAT and PIT are not required.
Business registration procedures for coffee shops
Register to establish a business household
Dossier, order and procedures for household business registration are specified in Article 87 of Decree 01/2021/ND-CP.
- Profile composition
– Application for business household registration (Appendix III-1 of Circular 01/2021/TT-BKHDT)
– Legal documents (CCCD/ID/Passport) of the individual for the owner of the business household, household members registering the business household in the case of household members registering business households
– Power of attorney enclosed with personal legal papers for the person authorized to carry out business household registration procedures
- Where to submit application
After preparing the above-mentioned documents, the individual or the representative of the household shall submit it at the business registration office of the district where the business household is located. Specifically, submit at the One-Stop-Shop (public service department) of the district-level People’s Committee where the business household is located
- Procedure time
Within 03 working days from the date of receipt of the application, the business registration authority of the district will award a receipt and issue a certificate of business household registration.
- Settlement fee
Decided by the Provincial People’s Council (according to Circular 85/2019/TT-BTC). Normally, the settlement fee is 100,000 VND/time.
Apply for a food hygiene and safety license
According to Article 11, 12 of Decree 15/2018/ND-CP, all food production and trading establishments must have a Certificate of eligibility for food safety when operating, except for the following cases: :
– Small initial production;
- Producing and trading in food without a fixed location;
- Small processing;
– Retail food business;
- Trading in prepackaged foods;
- Producing and trading in tools, packaging materials, food containers;
– Restaurant in the hotel;
– The collective kitchen does not have a registered food business;
- Trading in street food.
– The establishment has been granted one of the Certificates: Good Manufacturing Practice (GMP), Hazard Analysis and Critical Control Point (HACCP) System, ISO 22000 Food Safety Management System, Standard International Food Standard (IFS), Global Standard for Food Safety (BRC), Food Safety System Certification (FSSC 22000) or its equivalent.
Thus, all establishments engaged in food production and trading activities must have a Food Safety License, except for some establishments. In which, Clause 10, Article 3 of Decree 15/2018/ND-CP stipulates the retail food business establishments as follows:
Small food business establishments: An establishment that is registered by individuals, groups of individuals or households and is not granted a business registration certificate or a business registration certificate. business or investment certificate as prescribed by law.
If a cafe is registered as a household business by an individual or household, it is considered a small food business. Therefore, if the waste coffee shop registers as a small-scale business, it will not have to apply for a food hygiene and safety license.
Please see more:
Procedures for capital contribution to JSC in Vietnam
Business registration procedures for branches in Vietnam
Package business household registration service in Vietnam
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Frequently asked questions
According to regulations, for business individuals not subject to business registration as prescribed, the notice of business suspension shall be sent to the tax authority directly managing them no later than 01 working day before the temporary suspension. operations and business. Therefore, you are a business individual not subject to business registration must notify the business suspension to the tax office.
Firstly, having an added-value invoice on goods or service purchases or a document proving the payment of value-added tax at the stage of importation;
Secondly, having a via-bank payment document of purchased goods or services, except goods or services valued at under twenty million Vietnam dong upon each time of purchase;
Thirdly, for exported goods and services, apart from the conditions specified at Points a and b of this Clause, the business establishment must also have a contract signed with a foreign party on goods sale or processing or service provision, a goods or service sale invoice, a via-bank payment document, and a customs declaration.
Payment for exported goods or services by clearing between exported goods or services and imported goods or services or paying debts on behalf of the State is regarded as via-bank payment.
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