Current regulation on charter capital contribution allows capital contribution in cash or capital contribution through banks. The instructions below will clarify and guide how to apply the law properly.
Circular 09/2015 / TT-BTC dated January 29, 01 of the Ministry of Finance
“Article 3. Payment method in capital contribution transactions, purchase, sale and transfer of capital contributions to other enterprises
1. Enterprises do not use cash (paper money, metal money issued by the State Bank) to make payment when making capital contribution and purchase and sale transactions, and transfer of contributed capital to other enterprises.
2. When conducting capital contribution transactions and buying and selling, transferring capital contributions to other enterprises, enterprises shall use the following forms:
a) Pay in Czech;
b) Payment by payment authorization - money transfer;
c) Other forms of non-cash payment in accordance with current regulations.
3. When conducting capital contribution transactions and buying, selling, and transferring capital contributions to other enterprises using assets (not cash), enterprises must comply with the provisions of the law on enterprises.”
See more:
- Circular 09 guides on capital contribution to enterprises
- Official Letter 786_TCT-CS of TCT instructs to contribute capital to enterprises
- Restoration 222_2013_ND-CP
Official Dispatch No. 786/ TCT-CS dated 01 / 03 / 2016 issued by the General Department of Taxation:
" The General Department of Taxation receives Official Letter No. 05-2015 / Bolt-KT dated 25 / 12 / 2015 of the Open Training Institute and research and development asking about the capital contribution transaction in cash and VAT of foreign contractors for service of providing foreign language teachers. VIn this regard, the General Department of Taxation has the following opinions:
Regulations on cash payments.
At Article 6 Decree No. 222/2013 / NĐ-CP dated 31/12/2013 of the Government vOh Cash payment specified:
"Article 6. Financial transactions of enterprises
1. Businesses do not pay cash in contributed transactions vstinkn and purchase and sell, transfer capital contribution to enterprises.
2. Enterprises that are not credit institutions do not use cash when borrowing and lending each other. ”
Based on the above provisions, enterprises are not allowed to use cash when contributing capital, buying, selling or transferring their contributed capital into enterprises. This provision does not apply to individuals when contributing capital to enterprises. "
As such, enterprises can apply the following regulations on charter capital contribution:
- Enterprises use their capital to invest capital in other enterprises: Do not use cash
- Individuals contributing capital to enterprises: Can use cash or bank
Tips when applying the Regulation on charter capital contribution
Although it is possible to contribute capital in cash to businesses, however, cash contribution contributes to the following issues:
- Must check big money
- There is a risk of counterfeit money
- The receipts must be stored carefully, if the loss will greatly affect the business when it proves to contribute sufficient capital to the tax authorities, the state and shareholders.
- The signature must be checked correctly on the receipt, it must be sufficient 5 signature
- If the company has 1 members, the reliability is not high
- The retention of large amounts of money is at risk
- If auditing is required, the proof of capital contribution is very complicated and difficult
- Low reliability
Given the above risks, the decision to accept cash contributions should be carefully considered.
If the cash capital contribution is not made properly and is not accepted as having been fully contributed, what consequences will it have for the enterprise?
- It is not allowed to calculate loan interest on expenses when calculating corporate income tax if not contributing enough charter capital
- Violation of enterprise law on capital contribution
- Can not prove financial capacity with partners and shareholders
