The Government has issued Decree 20/2026/ND-CP, detailing and guiding the implementation of a number of articles of Resolution 198/2025/QH15 on special mechanisms and policies for private economic development.
One of the notable contents in this Decree is the policy of corporate income tax (CIT) exemption for 3 years for small and medium-sized enterprises registering for the first time, specifically regulated in Clause 3, Article 7.
According to regulations, small and medium-sized enterprises registering for the first time will be exempt from corporate income tax for a period of 03 years, from the time of being granted the first Business Registration Certificate.
The tax exemption period is calculated continuously, starting from the first year the business is granted a registration certificate, regardless of whether the business generates revenue or profit in that year or not.
For cases where the Enterprise Registration Certificate is issued before Resolution 198/2025/QH15 takes effect, but there is still a time to enjoy incentives, businesses are still entitled to continue to enjoy corporate income tax exemption for the remaining time according to new regulations.
Decree 20/2026/ND-CP also clearly states cases that are not eligible for corporate income tax exemption, in order to prevent abuse of preferential policies. Specifically, the 3-year corporate income tax exemption incentive does not apply to:
First, newly established enterprises but arising from mergers, consolidations, divisions, separations, ownership conversions or business type conversions.
Second, a newly established enterprise where the legal representative, member of the partnership or the person with the highest capital contribution has participated in business activities with the above-mentioned roles in another operating enterprise, or the enterprise has been dissolved but not enough 12 months, calculated from the time of dissolution to the time of establishment of the new enterprise.
Third, income items that are not eligible for tax incentives, as stipulated in Clause 3, Article 18 of the 2025 Enterprise Income Tax Law.
Corporate income tax exemption in the first 3 years is assessed as a practical support policy, helping small and medium-sized enterprises, especially startups, reduce financial pressure, have more resources to reinvest, expand production and business, and improve competitiveness in the early stages of operation.
It's a bit of a bit of a bit of a bit of a bit of a bit.
