The Korean and Vietnamese governments have provisionally signed a revised double tax avoidance agreement.
Korea/Vietnam double tax agreement (DTA) will become effective in 2015 following the ratification of the agreement by the respective authorities, reported BusinessKorea.
Under the revised pact, Korean enterprises operating permanent businesses in Vietnam will not be taxed by Vietnam on income generated in any other region other than Vietnam.
According to the new rules, stock transfer income from all shares, excluding real estate stocks, will be taxed in the source country.
Additionally, the withholding tax rate for royalties will be reduced from 10% to 9%.
However, a technical service fee will be subject to taxation at a limited tax rate of 7.5 in the source country.
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