FACTORY CONSULTING, BUILDING AND LEASING SERVICES
Enterprises operating in the fields of services, technology, commerce will choose to locate their headquarters in city centers with convenient traffic and sufficient services. Manufacturing enterprises, however, need manufacturing plants with large area that are conducive to transporting and storage of inventories.
In addition, environmental issues, resource advantages, cheap labor and local benefit policies are also some concerns of enterprises.
Especially, some production and manufacturing industries must depend on local planning and permission to initiate the projects.
Therefore, enterprises absolutely need information and consultation to make decisions suitable to their demand. Below are the matters enterprises might concern:
- Geographical location
- Transportation infrastructure
- Economic planning, environmental planning
- Labor force
- Benefit policies in terms of land rent, tax payment
- Entities providing consultation, designing and support to establish the factories.
FACTORY AND WAREHOUSE CONSULTING
The purpose of our consultation is to provide enterprises with the best information for their options. The decision whether to rent factories and where to locate the headquarters are extremely crucial, which can affect enterprises’ long-term business. Please take into account these following fundamental factors:
- Geographic location
- Whether the local planning permits your field of business
- Whether the local authorities have any special benefit or support policy
- Is there any advantage in recruiting and using local labor?
- Ground rent, comparative information of rental price with other regions and areas
- Is transportation and technology infrastructure satisfactory?
BUILDING AND CONSTRUCTING FACTORIES
Choosing an entity providing consultation, designing and construction of factories is of utmost importance. Normally, the cost of building factories is an enormous fixed cost and affects enterprises’ business activities in the long run. Depending on the business fields, production chain’s characteristics, we will consult and initiate the construction in a way that optimizes capacity and guarantees structural technical standards.
After choosing the location, investors and we will focus on discussion these important matters:
- Investment expenses
- Material, equipment standards
- Construction and payment progress
- Environmental standards
- Fire prevention and protection standards
BROKERAGE AND LEASING OF FACTORIES
Enterprises do not need to invest and build factories from the beginning. Industrial zones in Vietnam still have various options for enterprises with read-built factories and warehouses, which are diverse in terms of area, scale and structure with lots of different production and manufacturing models.
Depending on the demand of enterprises, we will provide suitable information and options. Enterprises’ requirements usually include:
- Products and fields of production and manufacturing
- Desired geographical location
- Estimated budget
WHY CHOOSING OUR SERVICES?
- We have services and information that offer various options for enterprises.
- Our team has several years of experience in providing satisfactory consultation and support for customers.
- We will accompany and sufficiently consult enterprises during their investment and operation in Vietnam.
- Our service fees are competitive
- We have successfully launched various factory models for reference.
Please contact us to get timely consultation and support.
Pursuant to Article 18, Law on Enterprises No. 59/2020/QH14 as of 17/6/2020:
“Article 18. Pre-registration contracts
1. The enterprise’s founder may sign contracts serving the establishment and operation of the enterprise before and during the process of enterprise registration.
2. When the Certificate of Enterprise Registration is granted, the enterprise shall continue exercising and performing the rights and obligations under the concluded contracts mentioned in Clause 1 of this Article, and the parties shall transfer the rights and obligations in accordance with the Civil Code, unless prescribed by the contracts.
3. IN case the Certificate of Enterprise Registration is not granted, the persons who conclude the contracts mentioned in Clause 1 of this Article are responsible for their execution. Any other participant in the establishment of the enterprise is also responsible for the execution of these contracts.”
Pursuant to Clause 12.b, Article 14, Circular No. 219/2013/TT-BTC as of 31/12/2013 by the Ministry of Finance about guidance on implementation of the law on value-added tax and the Government’s Decree No. 209/2013/ND-CP dated 18/12/2013 providing guidance on some articles of the law on value-added tax:
“12. When the taxpayer authorizes another entity to make a purchase, the invoice for which bears the name of the authorized buyer, input VAT on such purchase may be deducted in the following cases:
b) Before a company is established, its founders authorizes another entity in writing to pay on their behalf some amounts related to the establishment of the company and purchase some goods, the company may deduct input VAT according to the invoices bearing the name of the authorized entity. The invoices of which the value is 20 million VND or more must be paid by bank transfer.”
Pursuant to Article 4, Circular No. 96/2015/TT-BTC dated 22/6/2015 by the Ministry of Finance, amendments of Article 6, Circular No. 78/2014/TT-BTC dated 18/6/2014 by the Ministry of Finance are stated as follows:
“Article 6. Deductible and non-deductible expenses when calculating taxable income
1. Except for the non-deductible expenses prescribed in Clause 2 of this Article, every expense is deductible if all of these following conditions are satisfied:
a) The actual expense incurred is related to the enterprise’s business operation.
b) There are sufficient and valid invoices and proof for the expense under the regulations of the law.
c) There is proof of non-cash payment for each invoice for purchase of goods/ services of VND 20 million or over (including VAT).
The proof of non-cash payment must comply with regulations of law on VAT…”
Pursuant to Clause 3, Article 3, Circular No. 45/2013/TT-BTC dated 25/4/2013 by the Ministry of Finance about guiding regulation on management, use and depreciation of fixed assets:
“3. The cost of establishment of enterprise, cost of staff training, advertising cost incurred prior to the establishment of enterprise, cost of research stage, relocation, sale for possession and use of technical materials, patents, license of technology transfer, trade marks, business advantage that are not intangibles fixed assets but are amortized into business cost of enterprises in a maximum time not exceeding 3 years according regulations of Law on Enterprise Income Tax.”
Pursuant to Clause 7, Article 3, Circular No. 26/2015/TT-BTC dated 27/02/2015 amending Article 16, Circular No. 39/2014/TT-BTC dated 31/3/2014/TT-BTC on invoices for goods sales and service provision:
“7. Article 16 is amended as follows:
a) Point b Clause 1 of Article 16 (amended in Clause 3 Article 5 of Circular No. 119/2014/TT-BTC) is amended as follows:
b) When selling goods and services, including those used for trade promotion, advertising, samples, goods and services used for donation, exchange, or paid as salaries (except for goods internally circulated or internally used to proceed production), the seller must issue invoices.
Information on invoices must match the actual transactions; no erasure and change may be made; the ink used must be inedible and consistent in color; red ink is not permitted; numbers and text must be written continuously without interruption. Do not write on printed text. Any blank space shall be crossed out. It is not required to cross out blank space on self-printed invoices or ordered invoice issued by computers.”
According to the above-mentioned regulations, in case the founder of the Company has a letter of authorization to the individual who rents the office before the establishment of the Company, if the use of this office relates to the establishment of the enterprise, has enough invoices as required (invoices, documents undersigned by the authorized individual, invoices valued above VND 20 million must be paid through the banks), then it is recorded as deductible expense when calculating Corporate Income Tax, the expense is allocated into business expenses within 3 years since the enterprise started operating.
Factories, land belonging to redundant factory construction are real estates. Leasing factories, land belonging to factory construction is leasing real estates.
Henceforth, as long as this property satisfies the conditions, which are Real estate allowed to be traded and belonging to an enterprise licensed to trade properties, then it can be rented normally.
Therefore, leasing redundant factories is permitted and must satisfy 2 criteria:
-First, the real estate has to sufficiently satisfy the business conditions according to Article 9, Law on Real Estate Trading No. 66/2014/QH13 dated 25/11/2014.
-Second, it must satisfy the condition of the trader of the real estate.
In addition, it is necessary to consider whether the factory leasing contract of the enterprise has any term bounding re-rental.
Especially, foreign investors who rent factories from lessors with redundant area need to consult solicitors or licensing authorities whether such location is ratified for project execution.
The time limit for land leasing is agreed by both parties based on the demand and capability to satisfy the demand of each party. However, there are some factors determining the lease’s time limit, such as:
-Long-term or short-term usage of the lessees and the capability to satisfy the demand of the lessors.
-The life-span of the construction on the existing land.
-General local planning
-The differences in time limit options when negotiating price policies
For production and manufacturing enterprises when launching projects and requesting Investment Registration Certification, the duration of the investment will be explained. This is an utmost important content for these following reasons:
-Evidence for the applicability and conductibility of capital contribution as agreed;
-Complying with and controlling progress will directly relate to the investment project’s right of receiving value-added tax refund.
In reality, there have been many enterprises could not receive tax refund and their tax reached up to billions of VND. The reason is that enterprises can only receive tax refund during the investment stage. However, due to various factors during the initiation, enterprises may already have revenue before the investment is completed, or be late in requesting tax refund. These are considered severe damages to enterprises in their initial stage of operation.
Therefore, we often consult customers carefully. Especially, customers’ accountants need to understand and meticulously control this matter.
The fundamental rights when renting factories:
-Access information about Governmental regulations, industrial zones’ activities
-Guarantee in terms of security, fire prevention and protection
-Guarantee in terms of design and operation compatible with local planning
-Guarantee to provide water, electricity and usage rights for living and production activities
-In addition, depending on each contract, there will be services for personal demand
Our team always respect your privacy and guarantee to protect your information in our consulting activities.
Complying with the laws and service contracts are our goals and principles in our consulting activities.
Timely provision of services while complying with and controlling the quality will always be the persistent principle implemented at Vinasc.