Vietnam company dissolution: steps, tax checks and timing

Vietnam company dissolution follows a fixed order of steps set by the Law on Enterprises No. 59/2020/QH14 and Decree No. 01/2021/ND-CP. The owners decide to close, tell the authorities, pay debts in a set order, settle tax, and then file a dossier. Only after that does the registry mark the company as dissolved. This guide walks through each step in plain terms, with the time limits the rules give.

When a company can be dissolved

Article 207 of the Law lists four cases. The first is that the operating term in the charter ends and no one extends it. The second is a decision by the owners: the owner of a sole proprietorship, the members' council of a partnership, the members' council or owner of a limited liability company, or the general meeting of shareholders of a joint stock company. The third is that a company has fewer than the minimum number of members for 6 months in a row and has not changed its company type. The fourth is that the enterprise registration certificate is revoked.

There is one firm condition. A company may be dissolved only when it commits to pay its debts and other property duties in full, and it is not in a dispute before a court or arbitration. If the certificate was revoked, the managers involved are jointly liable for the company's debts.

Sources: Law on Enterprises No. 59/2020/QH14, Article 207.

Step one: the decision and the notice

For a voluntary closure, the owners first approve a resolution or decision. It must state the company name and head office address, the reasons, the time limit and method for ending contracts and paying debts, and the plan for obligations under labor contracts. The right person signs it, such as the owner or the chair of the members' council or board.

The owners then organize the sale of assets themselves, unless the charter sets up a separate liquidation body. Within 7 working days of approval, the company must send the resolution and meeting minutes to the business registration office, the tax office and its employees. It also posts the resolution at its head office, branches and representative offices. If the company owes money, it sends a debt settlement plan to creditors. That plan lists each creditor, the amount, the deadline, and how and where payment will be made.

Once the registry gets the notice, it posts the company's status as "undergoing dissolution procedures" on the National Business Registration Portal. Decree 01 gives it 1 working day to do this and to pass the information to the tax office.

Sources: Law on Enterprises No. 59/2020/QH14, Article 208, Clauses 1 to 4; Decree No. 01/2021/ND-CP, Article 70, Clauses 1 and 2.

Step two: pay debts in the right order

The law sets a priority list. First come unpaid wages, severance, and social, health and unemployment insurance premiums, plus other employee benefits set in labor contracts. Second come unpaid taxes. Third come all other debts. What is left after dissolution costs and debts goes to the owner, members or shareholders, in line with their share of capital.

From the date of the dissolution decision, the company and its managers face limits. They may not hide or scatter assets, deny or cut what creditors are owed, turn unsecured debts into secured ones, sign new contracts (except those needed to close the company), pledge, donate or lease out assets, stop a contract that is already running, or raise capital.

Sources: Law on Enterprises No. 59/2020/QH14, Article 208, Clauses 5 and 6, and Article 211.

Tax checks along the way

Tax is checked twice. The first check starts early. When the registry passes the dissolution news to the tax office, the company must deal with its tax duties under the Law on Tax Administration. Tax debts rank second in the payment order, so they must be cleared before ordinary creditors are paid.

The second check comes at filing. After the registry receives the final dossier, it sends the details to the tax office. The tax office has 2 working days to give its opinion on whether the company has met its tax duties. If it has no objection, the registry can move to the final step.

Sources: Decree No. 01/2021/ND-CP, Article 70, Clauses 2 and 5; Law on Enterprises No. 59/2020/QH14, Articles 208 and 210.

Step three: file the dossier and wait for the registry

Within 5 working days after the debts are fully paid, the legal representative must file the dissolution dossier with the business registration office. Under Article 210, it has two parts: a notice of dissolution, and a report on the sale of assets with a list of creditors and the amounts paid, including tax and insurance.

Before filing, the company must first close its branches, representative offices and business locations at the registry offices in the places where they sit. The people who sign the dossier are responsible for its accuracy. If it is wrong or forged, they are jointly liable for unpaid employee claims, tax and other debts, and they answer personally for the results for 5 years from the date of filing.

After the dossier arrives, the registry has 5 working days to change the company's status to "dissolved" and issue a notice of dissolution, provided the tax office has no objection.

Sources: Law on Enterprises No. 59/2020/QH14, Articles 208 and 210; Decree No. 01/2021/ND-CP, Article 70, Clauses 3 to 5.

Timing, the 180 day rule and revoked certificates

The rules give two clocks. If 180 days pass from the date the registry received the dissolution notice, and it has received no dossier and no written objection from interested parties, the registry itself changes the status to "dissolved" and tells the tax office. It has 3 working days after the deadline to do so. A company should not treat this as a shortcut, because debts and tax duties do not vanish with a status change.

If the owners change their mind within those 180 days, and the status has not yet changed, they can send the registry a notice of cancellation with a resolution to cancel the dissolution.

A different path applies when the registration certificate is revoked or a court orders the closure. The registry posts the status notice right away. The company then has 10 days to hold a meeting and decide on dissolution, send the decision to the registry, the tax office and employees, and display it at its offices. Debts follow the same priority list, and the same 5 working day filing rule applies.

Sources: Decree No. 01/2021/ND-CP, Article 70, Clauses 6 and 7, and Article 71; Law on Enterprises No. 59/2020/QH14, Articles 208 and 209.

Sources list: Law on Enterprises No. 59/2020/QH14, passed on 17 June 2020, in force from 1 January 2021; Decree No. 01/2021/ND-CP of 4 January 2021 on enterprise registration, Articles 70 and 71, official Vietnamese text. Check the current official text and ask a licensed adviser before you act on a specific company.