Final Test F6 Acca: TH TH TH

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FINAL TEST F6 ACCA

SUPPLEMENTARY INSTRUCTIONS
1. Calculations and workings need only be made to the nearest VND, unless instructed otherwise.
2. All apportionments should be made to the nearest month.
3. All workings should be shown in Section
TAX RATES AND ALLOWANCES
The following tax rates and allowances are to be used in answering the questions
Value added tax (VAT)

Standard rate 10%
Reduced rate 5%
Corporate income tax (CIT)

Standard rate for enterprises 20%
Foreign contractor tax (FCT)

Value added tax rates as a percentage (%) of taxable turnover %
1. Services, leasing of machinery and equipment, and insurance. 5
2. (a) Construction, assembly and installation where the tender includes
the supply of materials, machinery and equipment in the construction work. 3
(b) Construction, assembly and installation where the tender does not
include the supply of materials, machinery and equipment in the construction work. 5
3. Other business and production. 2
Corporate income tax rates as a percentage (%) of taxable turnover: %
1. Trading: distribution and supply of goods, raw materials, supplies, machinery and equipment associated
with services in Vietnam (including the supply of Trading: distribution and supply of goods, raw
materials, supplies, machinery and equipment associated with services in Vietnam (including the
supply of goods in
the form of on-the-spot export (except processing goods for foreign organisations and individuals); and the
supply of goods under the terms of Incoterms). 1
2. Services, leasing of machinery and equipment, insurance, leasing of oil rigs. 5
3. Management services of restaurants, hotels and casinos. 10
4. Leasing of aircraft, aircraft engines, aircraft spare parts and sea going vessels. 2
5. Constructionandinstallationregardlessofwhetherthetenderincludes or does not include the supply of
materials, machinery and equipment in the construction work 2
6. Other production or business activities and transportation (includingseaand air transportation) 2
7. Assignments [transfers] of securities, reinsurance and commissions from reinsurance. 0·1
8. Derivatives 2
9. Loan interest. 5
10. Income from royalties. 10
Personal income tax (PIT)

Regular income tax rates for Vietnamese citizens and other residents in Vietnam
Portion of monthly Tax rate
assessable income %
(VND million)
Up to 5 5
Over 5 to 10 10
Over 10 to 18 15
Over 18 to 32 20
Over 32 to 52 25
Over 52 to 80 30
Over 80 35
Net to gross calculator

N < 4,750,000 G = N/0·95
4,750,000 < N < 9,250,000 G = (N – 250,000)/0·9
9,250,000 < N < 16,050,000 G = (N – 750,000)/0·85
16,050,000 < N < 27,250,000 G = (N – 1,650,000)/0·8
27,250,000 < N < 42,250,000 G = (N – 3,250,000)/0·75
42,250,000 < N < 61,850,000 G = (N – 5,850,000)/0·7
N > 61,850,000 G = (N – 9,850,000)/0·65
Gross basis % Tax

G < 5,000,000 5 T = 0·05G
5,000,000 < G < 10,000,000 10 T = 0·1G – 250,000
10,000,000 < G < 18,000,000 15 T = 0·15G – 750,000
18,000,000 < G < 32,000,000 20 T = 0·2G – 1,650,000
32,000,000 < G < 52,000,000 25 T = 0·25G – 3,250,000
52,000,000 < G < 80,000,000 30 T = 0·3G – 5,850,000
G > 80,000,000 35 T = 0·35G – 9,850,000
Notes:
G: Gross income N: Net income T: Income tax
Non-resident tax rate on employment income: 20% on Vietnam sourced income
PIT rates on other income
Resident Non‐resident
Investment income 5% 5%
Capital transfers 0·1% of selling price 0·1% of selling price
Transfers of property 2% of selling price 2% of selling price
Royalties/franchises 5% of the income in 5% of the income in
excess of VND10 million excess of VND10 million
Prizes/inheritances 10% of the income in 10% of the income in
excess of VND10 million excess of VND10 million
Personal deductions (per month)

Self VND 11,000,000
Dependant VND 4,400,000
Social insurance, health insurance and unemployment insurance on salary and

allowances Rates for the year 2016
Social insurance (SI) 8%
Health insurance (HI) 1·5%
Unemployment insurance (UI) 1%
Base salary (per month) for social insurance, health insurance, etc for the year 2017
Note: For simplicity, you should assume that this rate is applicable for the whole of the year
2020.
VND 29,800,000
Rates of exchange
The following rates of exchange are to be used in answering all questions in this
paper (unless otherwise stated):
USD 1 = VND 23,500
Section A – ALL 15 questions are compulsory and MUST be attempted
Each question is worth 2 marks.
1 On 1 January 2020, company CRS Co purchased a 16-seat car for VND2,640 million (including value added
tax (VAT)) with proper invoices. The car will be depreciated for five years.
What is the amount of the adjustment for non‐deductible expenses which CRS Co should make for the car
in its tax return for the year 2020?
A. VND0 million
B. VND208 million
C. VND320 million
D. VND528 million
2 Which of the following items of income would NOT be subject to personal income tax in Vietnam?
(1) Medical support for fatal disease from the employer to the parent-in-law of an employee
(2) One time round trip home leave air fares for the family of an expatriate employee
(3) Kindergarten tuition fees for the children of a Vietnamese employee working abroad
(4) Voucher issued by the employer to an employee for lunches in the canteen operated by the employer
A. 1, 2 and 3
B. 2, 3 and 4
C. 1, 2 and 4
D. 1, 3, and 4
3 Zenita Co, a Brazilian company, signed a contract with a Vietnamese company, Company X, for the construction
of a factory in Vietnam. The contract value is USD19 million. Zenita Co subcontracted part of the construction
works with a value of USD3 million to Company A, a Vietnamese company, and works with a value of USD2·5
million to Company B, a Taiwanese company, adopting the deemed method for foreign contractor tax (FCT).
Zenita Co also purchased goods for the works with a value of USD2 million from Vietnamese suppliers.
What is the amount of the foreign contractors’ taxable revenue from the contract for the purposes of FCT?
A. USD19 million
B. USD13·5 million
C. USD16 million
D. USD11·5 million
4 At the end of 2020, company, BND Co, paid bonuses to its board of directors of VND3,000 million. Each of the
five directors is paid an equal amount of bonus. Two out of the five directors are not involved in the daily
management of the company’s business.
What is the amount of tax deductible expenses which BND Co will be able to claim for the year 2017?
A. VND3,000 million
B. VND1,200 million
C. VND1,800 million
D. VND0 million
5 PROVI Co is a company established in Vietnam. PROVI Co paid provisional quarterly corporate income tax (CIT)
of VND8 billion relating to the year ended 31 December 2020. The final tax liabilities of PROVI Co per its CIT
finalization return for 2020 was VND11 billion. The company settled the additional tax obligations as per its
CIT finalisation return for 2020 on 31 March 2021.
What is the amount on which the late tax payment penalty payable by PROVI Co will be based and
from which date would it be charged?
.
A. Based on VND0.25 billion, payable from 31 January 2021
B. Based on VND2·2 billion, payable from 31 January 2021
C. Based on VND2·2 billion, payable from 1 April 2021
D. Based on VND3 billion, payable from 31 January 2021
6 Which of the following transactions would be subject to foreign contractor tax (FCT) in Vietnam?
(i) Repair of a Vietnamese internet cable offshore
(ii) Online training for the employees of a Vietnamese company where the server is hosted overseas
(iii) An intermediary arrangement for a Vietnamese company to provide services in Singapore
(iv) Granting of rights to a Vietnamese company to use the international brand name of a world famous
product in Vietnam
A. i and ii
B. ii and iv
C. i and iii
D. iii and iv
7 In 2015, company CTC Co contributed capital of VND500 million to Company Z. In 2017, CTC Co transferred
60% of the capital it held in Company Z to a foreign company for VND450 million. At that time the retained
earnings of Company Z were VND5 million. CTC Co incurred transfer expenses of VND10 million.
What is the taxable income/(loss) of CTC Co from the transfer?

A. VND50 million (loss)
B. VND140 million
C. VND145 million
D. VND147 million
8 Ms Nga Le is a Vietnamese national with no dependants. On 1 January 2020, she signed a gross employment
contract with salary of VND260 million per month. Her employer is not required to withhold compulsory
insurance from her income.
What is the amount of Ms Nga Le’s monthly net take home income?
A. VND81·15 million
B. VND78 million
C. VND182 million
D. VND182.7 million
9 TLN Co is a Vietnamese limited liability company. Hanada Co, a Japanese company, is considering
transferring its capital contribution in TLN Co to Nahada Co, an Indian company.
Which party will be responsible for making the tax declaration for the above transaction?
A. Hanada Co only
B. Nahada Co only
C. Nahada Co and TLN Co
D. TLN Co only
10 TDP Co, a Vietnamese company applying the value added tax (VAT) deduction method, provided services to a
foreign customer for VND200 million and charged VAT at 5% on the invoice. In a tax review by a consultant, it
was identified that the VAT rate used on the invoice should have been 10%, however, TDP Co can no longer
claim back the undercharged VAT from the foreign customer.
What is the amount of additional output VAT which TDP Co will need to pay to the tax authorities
(rounded to the nearest VND million)?
A. VND9 million
B. VND10 million
C. VND11 million
D. VND20 million
11 Tokyo Co, a Japanese company, signed a contract with a Vietnamese project owner for the supply and
installation of some equipment. Tokyo Co subcontracted all the equipment supply value to a Vietnamese
subcontractor and only performed the installation activities itself.
What would be the foreign contractor tax (FCT) rates applicable to Tokyo Co under the deemed method?
Value
Corporate income added
tax (CIT) tax (VAT)
A. 2% 3%
B. 5% 5%
C. 1% Exempt
D. 10% Exempt
12 On 1 April 2017, Mr Chau, a Vietnamese national, started employment with a new employer, CTD Co. CTD Co
has a policy whereby both the employer and the employee contribute to a voluntary pension fund approved by
the Government. The monthly contributions for the employer and the employee, respectively, are VND4·5
million and VND2 million.
What is the amount of the deduction Mr Chau can claim against his taxable income for
the above contributions in 2017?
A. VND9 million
B. VND78 million
C. VND24 million
D. VND18 million
13 In 2017, company DMS Co purchased materials from suppliers who are households doing business. DMS
Co wanted to use the list of goods purchased (without invoices) to claim tax deductible expenses for these
purchases.
What is the threshold of annual revenue which households doing business must satisfy for DMS
Co to use the list of goods purchased method to claim for the purchases as a tax deductible
expense?
A. VND300 million
B. VND200 million
C. VND100 million
D. VND50 million
14 In 2020, SPTF Co incurred losses of VND10 billion from incentive activities which were subject to a tax
rate of 10%, made gains from the transferring of real estate of VND3 billion and had other income of
VND8 billion.
What is the minimum tax liability of SPTF Co in 2017?

A. VND2,420 million
B. VND660 million
C. VND600 million
D. VND0 million
15 Mr Albert, a Canadian citizen, arrived in Vietnam on 18 September 2019 to work under an employment contract.
He stayed in Vietnam for the whole of the time until 19 June 2020 when he completed his employment contract
and left Vietnam.
What is the amount of personal relief to which Mr Albert will be entitled to for his period in Vietnam?
A. VND0 million
B. VND90 million
C. VND110 million
D. VND108 million
(30 marks)
Section B – ALL SIX questions are compulsory and MUST be attempted
Please write your answers to all parts of these questions on the lined pages within the Candidates Answer
Booklet.
1 FXVN Ltd is a Vietnamese company established in 2014, whose functional currency is the Vietnam Dong. From
2014 to June 2016, the company was in the construction period (construction of its factory and purchase of
machinery and equipment) with no operations and no revenues. During this period, FXVN Ltd had the following
transactions in US dollars (USD):
Transactions Amount Date of USD/VND Note regarding accounting
USD transaction exchange records of monetary items
rate
Purchase of machinery on 4 million 1 February 2015 21,450 Recorded as ‘Payables for
credit fixed assets’
Receipt of first invoice from 3 million 1 December 2015 22,470 Recorded as ‘Payables for
the construction contractor fixed assets’
Settlement of amounts owed (7 million) 31 December 2015 22,410 Recorded as a reduction in
for machinery and ‘Payables for fixed assets’
construction (as above)
Receipt of final invoice from 3 million 15 February 2016 22,290 Recorded as ‘Payables for
the construction contractor fixed assets’
Settlement of the final invoice (3 million) 28 June 2016 22,370 Recorded as a reduction in
from the construction ‘Payables for fixed assets’
contractor
Factory and machinery 1 July 2016 22,340
completed at a total cost of
USD10 million and put into use
FXVN Ltd commenced business operations and started generating revenue from 1 July 2016. The company
expects to amortise the foreign exchange differences incurred during the construction period over the
maximum period available as allowed under the prevailing regulations in 2016.
Required:
(a) Explain the treatment of ‘realised’ foreign exchange differences arising from the formation of fixed
assets in the following periods:
– the construction period (where a company has no business operations); and
– the period from when a company starts its business operations.
(5 marks)
(b) Calculate (in VND millions) the amount of the foreign exchange differences which FXVN Ltd can capitalise
during the construction period, and the deductible expense from the amortisation of the capitalised
exchange differences allowable for corporate income tax (CIT) purposes, if any, in the fiscal year ended
31 December 2016.
(5 marks)
(10 marks)
2 Mr Simon Samson, a 52-year-old South African, arrived in Vietnam on 15 March 2016 following an invitation to
become a permanent teacher for VSU, an international school in Vietnam, for the period to December 2020.
VSU successfully registered Simon’s personal tax code and other necessary dependant registrations for personal
income tax (PIT) purposes on 31 March 2016.
Simon spent the remainder of 2016 in Vietnam. On a trip to visit an orphanage in the South, he adopted Luong
Le, a one-year-old Vietnamese boy, as his son. He completed the procedures for adoption and started to raise
Luong Le from 10 August 2016. Luong Le officially became a dependant of Simon from 31 August 2016.
Simon has a daughter, Lauren, who is 19 years old. At the time Simon moved to Vietnam, Lauren was studying
at a university in South Africa. In September 2016, she came to Vietnam to live with Simon and study at an
international university in Vietnam. Lauren has no income in the year 2016.
From May 2016, VSU signed a contract with a voluntary insurance fund which is allowed to operate in Vietnam
for Simon. According to this contract, VSU and Simon contributed VND2·5 million and VND0·8 million per month,
respectively.
In December 2016, Simon donated VND60 million to a qualifying charity fund.
After arriving in Vietnam, Simon started to write a book about his experiences with the culture in Vietnam, and
he signed a contract with Alone World, a foreign publisher, for publishing this book. According to this contract,
the total royalty will be USD60,000. In 2016, Alone World paid Simon the full amount of the royalty in two
instalments of USD30,000 each.
Required:
(a) Calculate (in VND millions rounded up to the nearest one decimal) all the possible deductions from
taxable income which Mr Simon Samson is entitled to for personal income tax (PIT) purposes during the
year 2016.
(7 marks)
(b) Briefly explain the tax treatment of a royalty received by a resident individual and calculate (to the
nearest VND million) the PIT liability, if any, incurred by Mr Simon Samson on the royalty income received
from Alone World in the year 2016.
(3 marks)
(10 marks)
3 MCNR Co is a European company specialising in machinery for the pulp and paper industry. In 2016, MCNR Co
received a request for proposal (RFP) from SGPP JSC, a company in Vietnam, for the construction of a paper
factory in Dong Nai, Vietnam.
The RFP requires that bidders quote a price which is gross of the corporate income tax (CIT) portion and
net of the valueaddedtax(VAT)portionoftheforeigncontractortax(FCT)payableinVietnam.
Based on its experiences from prior projects in Vietnam, MCNR Co estimated that the value net of all
withholding taxes which it would expect to receive from the project would be as follows:
Item Value net‐of‐tax Notes
USD
Machinery and equipment 45 million This amount can be broken down into: machinery
and equipment with a value of USD42 million, and a
one-year guarantee with a value of USD3 million.
MCNR Co estimated that it would purchase spare
parts for the machinery and equipment with a value
of USD2 million from MCEQVN, an affiliate of MCNR
Co in Vietnam.
Design and engineering services 8 million
Construction and installation 15 million MCNR Co will sign a contract to subcontract the
installation works valued at USD4 million to MCSIVN,
a subsidiary of MCNR Co in Vietnam.
Supervision 4 million
Commissioning 1 million
Technical training 2 million To be performed in Vietnam by personnel
dispatched from Europe by MCNR Co.
Total 75 million
Required:
a) State whether the cost of the spare parts to be purchased from MCEQVN and the value of the services to
be subcontracted to MCSIVN will be deductible from taxable revenue when determining the foreign
contractor tax (FCT) liability of MCNR Co.
(2 marks)
b) Calculate (in USD millions, rounded to two decimals) the contract price to be quoted by MCNR Co as
required in the request for proposal (RFP) and the potential FCT which will be withheld from the
payments made to MCNR Co if the parties agree to break down the value of each item in the contract.
(6 marks)
c) Calculate (in USD millions, rounded to two decimals) the contract price to be quoted by MCNR Co as
required in the RFP and the potential FCT which will be withheld from the payments made to MCNR Co
if the parties agree to state a lump sum price in the contract.
(2 marks)
(10 marks)
4 VRF Ltd is a Vietnamese company specialising in the manufacture of instant noodles for both domestic sale and
export. Domestic sales and exports of instant noodles are subject to value added tax (VAT) at the rates of 10%
and 0%, respectively. VRF Ltd frequently applied for and received the VAT refund up to and including May 2016.
The total amount of the VAT refund VRF Ltd received for May 2016 was VND4,770 million. The company’s VAT
declaration in May 2016 was as follows:
– Input VAT carried forward from April 2016 (for both domestic sales and exports): VND30 million
– Total input VAT incurred during May 2016 (for both domestic sales and exports): VND9,600 million
Due to the change in the VAT regulations according to Circular 130/2016, VRF Ltd ceased all VAT refund
applications in June and July 2016, but in August 2016 the company reconsidered and applied for a VAT refund
of the input VAT arising in June 2016, following the new principles for VAT refund set out in Circular 130/2016.
The total creditable input VAT arising during June 2016 was VND4,000 million (not including any amount carried
forward from May 2016), which VRF Ltd could not separate between domestic sales and exports.
The following information (exclusive of VAT, where applicable) is available for the months of May and June
2016:
Revenue from domestic sales Revenue from exports
VND millions VND millions
May 2016 16,800 25,200
June 2016 60,000 32,200
Required:
(a) Determine by calculation whether the value added tax (VAT) refund received by VRF Ltd for May 2016
was or was not correct, and calculate (in VND millions) the amount of input VAT, if any, which can be
carried forward to subsequent periods, following the VAT refund principles set out BEFORE Circular
130/2016 came into effect.
(5 marks)
(b) Estimate (in VND millions) the amount of the VAT refund which VFR Ltd can apply for in June 2016, if
the refund application is required to follow the VAT refund principles set out in Circular 130/2016.
(5 marks)
Notes:
1. In both parts of the question, the ratio for the allocation of input VAT between domestic sales
and exports should be calculated in whole percentages (i.e. rounded to zero decimal).
2. You should assume that all the input VAT amounts are valid and supported by proper documents.
(10 marks)
5 IVEX Ltd is a foreign invested company located in Tan Binh Industrial Park in Ho Chi Minh City. Although the
industrial park was no longer an incentivised area in 2015–2016, IVEX Ltd was still entitled to the tax incentives
stated in the investment certificate at the time of its establishment when the incentives for companies
established in industrial parks were still available.
In 2015, IVEX Ltd was entitled to the special tax rate of 15% with a 50% reduction for the original investment as
specified in the investment certificate. In 2015, IVEX Ltd invested VND50,000 million in a new production line,
which qualified as expansion investment under the corporate income tax (CIT) regulations. IVEX Ltd’s total
historical costs of fixed assets (including the new production line) at the fiscal year-end of 31 December 2015
was VND200,000 million.
In 2015, the taxable income declared by IVEX Ltd was VND48,000 million, of which other non-operating
taxable income was VND8,000 million.
In 2016, the incentive period of the company expired and IVEX Ltd became subject to the common tax rate.
According to its draft financial statements, IVEX Ltd had accounting profits before tax of VND160,000 million in
2016. The following issues which were recorded in the accounting profits are noteworthy for the purposes of
the company’s corporate income tax (CIT) finalisation:
1. Accrued wages and allowances of VND8,500 million were not paid before the deadline for CIT finalisation.
IVEX Ltd’s total actual salary fund in 2016 was VND55,000 million. No provision for salary fund was made
as at 31 December 2016.
2. Purchases without invoices amounted to VND9,200 million, of which VND2,800 million were purchases
of depletions from households who issued IVEX Ltd with lists of the purchases under form 01/TNDN.
3. Machinery bought in 2013 with a historical cost of VND6,000 million and an estimated useful life of five
years ceased to be used from 1 June 2015 for maintenance. In 2015, IVEX Ltd expected that this
maintenance would take 13 months, but the maintenance was in fact completed on 31 August 2016 and
the machinery was put into use again from 1 September 2016. In the draft financial statements, this
machinery was depreciated over 12 months in 2016.
4. Uniform expenses (supported with valid documents) were VND720 million paid in cash, and
VND360 million made in kind. IVEX Ltd had an average of 120 employees during the year 2016.
5. A profits share of VND40,000 million was received from a business co-operation contract (BCC) which IVEX
Ltd had entered into. These profits were after deducting CIT at the rate of 20%, which was declared and
paid by the operator.
From 2017, the foreign investor’s headquarter company is considering charging IVEX Ltd for the cost of the IT
support services it provides. The charge would include a specific charge for the costs incurred in respect of the
service requests made by IVEX Ltd, and a lump sum charge which would be allocated to all the investor’s
subsidiaries based on the judgement of the headquarter company and which could vary from year to year.
Required:
(a) Calculate the taxable income of IVEX Ltd in the year 2015 from the original investment, expansion
investment and other activities, and the total corporate income tax (CIT) liability of IVEX Ltd for the year
ended 31 December 2015.
Note: The standard rate of CIT in 2015 was 22%.
(5 marks)
(b) Calculate the taxable income and the tax liability which IVEX Ltd should declare in its CIT return for
the year ended31December2016.
Note: You should start your computation with the accounting profit of VND160,000 million and list all
of the items specifically referred to in notes 1 to 5, indicating by the use of ‘0’ any item for which no
adjustment is required.
(6 marks)
(c) Briefly explain the THREE principle conditions for expenses to be deductible by a company in Vietnam
according to the prevailing regulations, and state, giving reasons, whether or not the charge for IT support
services to be made by the headquarter company are likely to be deductible by IVEXL in the year 2017.
(4 marks)
(15 marks)
6 For the purposes of this question you should assume that today’s date is 1 January 2017.
Mr Tony Phu, a 40-year-old Vietnamese citizen, is married with two children, a ten-year-old daughter and a six-
year-old son. In 2016 Tony was promoted to become the general director of GIV JSC, a Vietnamese joint stock
company with diversified operations in various sectors in Vietnam, including retail outlets and education. Tony’s
gross-of-tax remuneration package for 2016, as stated in the labour contract, is as follows:
– Salary: VND580 million per month, with two additional monthly salaries to be received in February
and December.
– Incentive bonus: an award of 100,000 shares of GIV JSC if he successfully achieves the corporate
performance as set out at the beginning of 2016. Tony can choose to receive either the shares or cash
equivalent to the market share price as at 31 December 2016. In both cases the award will be made in June
2017.
– Car rental for transporting Tony from home to office and office to home: VND30 million per month to be
paid directly to the lessor by GIV JSC.
– Medical insurance fee (non-accumulative): VND180 million per year in total for the six persons in Tony’s
family (himself, his wife, his two children and his parents). An equal fee is payable for each person. The
insurance covers medical expenses up to VND1 billion per year for each insured person.
– Membership fee for golf club: VND160 million per year. The membership card is issued specifically to Tony.
– Share options to purchase 50,000 shares of GIV JSC at the nominal value of VND10,000 per share at the
beginning of 2016. These options had to be mandatorily exercised on 4 January 2016 (i.e. Tony had to
purchase the shares on that date), and the purchase cost of VND500 million was to be deducted from the
additional salary he received in February 2016. The shares were sold on 31 December 2016 at their market
price and the proceeds paid in cash to Tony on the same date.
As a standard benefit offered to all management positions, Tony’s children can study in a school established
and operated by a subsidiary of GIV JSC, with the tuition fees settled directly by GIV JSC to this subsidiary with
valid supporting documents. The fees quoted by the school for pupils at the grades of Tony’s daughter and son
are VND150 million and VND100 million per annum, respectively. The school has a general policy (applicable to
everyone) to offer a 5% discount for the second child of a family enrolled with the school.
The market price of the GIV JSC shares as at 4 January 2016 and 31 December 2016 was VND45,000 and
VND48,000 respectively. On 6 August 2016, GIV JSC paid a dividend of VND6,000 per share held (including the
shares received from the exercise of the share options).
GIV JSC has obtained guidance from the tax authorities instructing that the share options are taxable in the year
when the shares are sold, and that the taxable employment income is the difference between the market price
at the time of exercise and the exercise price (i.e. the price which the employee has to pay for the shares).
Tony is responsible for his personal income tax (PIT), as well as the social, health and unemployment insurance
contributions payable on his part. Tony’s wife and parents all have income in excess of an average of VND1
million per month.
Required:
(a) Determine (in VND millions) Mr Tony Phu’s taxable income and non‐taxable income for the year 2016,
and taxable income in future years for personal income tax (PIT) purposes with respect to his
employment income.
Note: You should present your answer in tabular form with the headings ‘Taxable in 2016,’ ‘Non‐taxable
in 2016’ and ‘Taxable in the future’, listing all of the relevant items referred to in the question in the
appropriate column.
(8 marks)
(b) Calculate (in VND millions rounded to one decimal) Mr Tony Phu’s monthly taxable income and the total
PIT liability in respect of his employment income for the year 2016.
(4 marks)
(c) Briefly explain the tax rates and timing of taxation in respect of the following items of Mr Tony
Phu’s investment income for the year 2016:
– the sale of the shares received as an incentive bonus;
– the sale of the shares received from the exercise of the share options; and
– the dividend from the shares.
Note: You are not required to calculate the tax payable in this part.
(3 marks)
(15 marks)
End of Question Paper

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SAPP Academy Tel 0466 709 888

6th Floor, No. 2A Trai Ca alley, Truong Dinh St Sapp.edu.vn

FINAL TEST F6 ACCA

TAX RATES AND ALLOWANCES

Value added tax (VAT)

Corporate income tax (CIT)

Foreign contractor tax (FCT)

Personal income tax (PIT)

Net to gross calculator

Gross basis % Tax

PIT rates on other income

Personal deductions (per month)

Social insurance, health insurance and unemployment insurance on salary and

Section A – ALL 15 questions are compulsory and MUST be attempted

Each question is worth 2 marks.

What is the taxable income/(loss) of CTC Co from the transfer?

What is the minimum tax liability of SPTF Co in 2017?

Section B – ALL SIX questions are compulsory and MUST be attempted

End of Question Paper

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