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The software manufacturing business is one of the industries that are favored by the state to encourage many talents to develop the IT field. Learning about the software industry code information as well as learning about the conditions and procedures for setting up a company will help you understand and ensure compliance with the provisions of the law.
Incentives for companies in the software industry
Tax incentives and tax exemptions for software-related businesses are of particular interest to the state. According to Article 4, Clause 21 of Circular 219/2013/TT-BTC stipulating:
- All software service businesses write 0% VAT invoices and will not be charged VAT for their products.
Tax incentives Software manufacturing enterprises are detailed as follows:
For new investment projects that produce software products on the list of software products and satisfy the process of software product production as prescribed by law, they are entitled to a preferential tax rate of 10% for a period of time . term of 15 years, tax exemption for 4 years, reduction of 50% of tax payable in the next 9 years.
Specifically:
– If you are a software manufacturer:
Since its establishment, the CIT rate from software production activities shall be applied as follows:
+ From year 1 to year 4: Enterprises are exempt from CIT from software production activities.
+ From year 5 to year 13 (next 9 years): 50% CIT reduction with a preferential tax rate of 10%, so software manufacturing enterprises only have to pay 5% CIT for software production activities. soft.
+ From year 14 to year 15 (tax rate of 10% for 15 years): The tax rate of 10% will be applied to income from software production and business activities.
– From year 16 onwards : Pay corporate income tax like normal enterprises (From 2016 onwards it is 20%)
– If you are an enterprise that buys/sells software , you are not entitled to CIT incentives as above.
Business conditions for software manufacturing industry
In addition to the above incentives, the software industry is not a conditional business. Therefore, setting up a business in this industry is quite simple:
♦ Have a business license in the field of registered industry
♦ Business owners do not need professional qualifications or credits
♦ The manufactured software products are in the list of software products regulated by the Ministry of Information and Communications;
The software production process must go through the following 7 steps:
- Define requirements.
- Analysis and design.
- Programming, writing code.
- Software testing and testing.
- Complete and package the software.
- Software installation, transfer, manual, maintenance, warranty.
- Release and distribution of software products.
Update the latest software manufacturing business code today
With the software engineering industry, there are 6 industry codes as follows:
- Sector code 5820: Software production
- Code 4651: Wholesale of computers, peripherals and software
- Sector code 6201: Computer programming
- Sector code 6311: Data processing, leasing and related activities
- Code 6209: Information technology services and other services related to computers
- Code 4741: Retail sale of computers, peripheral equipment, software and telecommunications equipment in specialized stores
Some notes when choosing a software manufacturing industry code:
Sector code 5820 Software publishing
This group includes:
– Publish ready-made software (unformatted) such as: Operating system; business and
other applications; computer game program.
– Publishing and publishing online video games.
To exclude, to expel:
– Reproduction of software, under class 18200 (Reproduction of records of all kinds);
– Retail sale of unformatted software, under class 4741 (Retail sale of computers,
peripheral equipment, software and telecommunications equipment in specialized stores);
– Manufacture of software not intended for publication, under class 62010 (
Computer programming);
– Online provision of software (applications and provision of application services), under
class 63110 (Data processing, leasing and related activities)
Procedures for setting up a software production company
Step 1 : Compose the application to register the establishment of a software production company
- Application for registration of establishment of a software production company
- Enterprise’s regulations
- List of members (depending on the type of business or List of shareholders if establishing a joint stock company)
- The following certificates: Identity card, citizen identification, or valid passport of the member (all relevant documents must be notarized copies)
Step 2: Submit application – receive results – post business report
- The completed application is submitted to the Business Registration Office – under the Investment Planning Department of the province where the company is located.
- After 5 to 7 days from the date of receipt of the application, the Business Registration Office will notify the receipt of the result or supplement the application if the application is not correct.
- Get business registration certificate of software company
- Pay the fee and publish the enterprise report on the national website. The published content includes the information recorded on the Certificate of Business Registration.
Step 3: Prepare the remaining procedures before putting the business into operation:
- Engrave the company’s seal and publish the seal sample to the Investment Planning Department of the City and Province
- Initial tax return for software companies and submission of declarations and license fees
- Register to use e-invoices and invoice issuance notices
- Hang company signs according to business registration address
- Open a business account
See also: Dossier, Procedures and Conditions Establishing a software company
Above, is the information shared about the software production business . If you still have questions, you can leave advice in the comment section or other consultation frames. We will assist you in setting up a company in this industry quickly.
