Official Dispatch 8214/CT-TTHT Ho Chi Minh City 2017 telephone allowances

To: Keppel Land Vietnam Company Limited

Address: 65 Le Loi Street, Ben Nghe Ward, District 1, Ho Chi Minh City

Tax identification number: 0310549368

In response to the Company’s document No. 20170426/KLV dated April 26, 2017, on personal income tax (PIT) policies for employees’ monthly telephone allowances, the Ho Chi Minh City Tax Department has the following opinions:

Clause 2 Article 2 of the Ministry of Finance’s Circular No. 111/2013/TT-BTC dated August 15, 2013, guiding the personal income tax (PIT) provides regulations on income from salaries and wages as follows:

“Incomes from salaries or wages are incomes received by employees from their employers, including:

a) Salaries, wages and amounts of salary or wage nature in monetary or nonmonetary form.

b) Allowances and subsidies, except the following…

…

dd) Other monetary or non-monetary benefits other than salaries and wages paid by employers to taxpayers in any form:

…

dd.4.1) For cadres, civil servants and employees working in administrative and non-business agencies, Party agencies, mass organizations, societies, and associations: The package payment levels comply with written guidance of the Ministry of Finance.

dd.4.2) For employees of business organizations and representative offices: The package payment levels comply with the levels for determination of enterprise income tax-liable income specified in documents guiding the Law on Enterprise Income Tax.

dd.4.3) For employees of international organizations and representative offices of foreign organizations: The package payment levels comply with regulations of such international organizations and representative offices.

…”

In case the Company’s payment of telephone support to employees in cash (monthly payment along with salary) has been specified in the employee handbook and the Company's policies and regulations or in the labor contract, this subsidy shall be income from salaries, wages and be included in the employees’ taxable income. If the Company’s payment of telephone support for employees to serve production and business has a legal invoice bearing the Company's name, address and tax identification number, this payment shall not be included in the employees’ taxable income.

The Ho Chi Minh City Tax Department hereby informs for strict compliance with legal documents cited in this document.