Executive summary

Effective 1 October 2025, the Law on Corporate Income Tax (CIT), the Law on Science, Technology and Innovation (ST&I)and Resolution No. 198/2025/QH15, along with their guiding regulations, allow eligible enterprises to deduct 200% of actual research and development (R&D) expenses incurred in the tax period for CIT purposes (Super Deduction Policy), subject to certain conditions.

Specifically, Law No. 67/2025/QH15 on CIT was enacted on 14 June 2025, and Law No. 93/2025/QH15 on ST&I was enacted on 27 June 2025. The regulations are provided in Decree No. 320/2025/ND-CP (Decree 320) guiding the CIT Law, Decree No. 265/2025/ND-CP (Decree 265) guiding the Law on ST&I, and Decree No. 20/2026/ND-CP implementing certain articles of Resolution No. 198/2025/QH15.

This Alert outlines the eligible expense categories, application timing, documentation expectations and interactions with Qualified Domestic Minimum Top-up Tax (QDMTT) considerations.

Applicability

R&D expenses subject to the Super Deduction Policy must meet the following conditions:

• The R&D expenses must fall within the categories stipulated in clause 2a, Article 15 of Decree 265, including:
• Salaries, wages and remuneration in the nature of a salary/wages paid to personnel directly engaged in R&D activities
• Expenses directly serving scientific research and technological development activities
• Expenses for leasing and using research results
• Expenses for royalties, transfer of ownership and usage rights with regard to industrial property
• Depreciation expenses and machinery and equipment rental expense for serving scientific research and technology development in laboratories
• Expenses for pilot production at a laboratory that is not yet ready for commercialization
• Expenses for registration of intellectual property protection
• Expenses must be actual expenses that are not reimbursed/funded by any other sources, including the enterprise's science and technology development fund or the science, technology development, innovation and digital transformation fund.
• Expenses must be supported by proper invoices and supporting documents, and payments must be made via non-cash payment methods in accordance with prevailing regulations.
• After applying the extra deduction, the enterprise must not incur a loss. The enterprise must self-declare the application of the Super Deduction in the relevant tax period.
• The enterprise must maintain a complete set of supporting documentation relating to the above-mentioned R&D activities in accordance with regulations, properly retain this documentation at the enterprise and submit it to the local tax authority upon request.

Timing for application of the R&D Super Deduction

Decree 320, providing guidance on the Super Deduction of R&D expenses, allows enterprises to elect to apply certain provisions including R&D Super Deduction from the beginning of tax year 2025, or from the effective date of the CIT Law (1 October 2025), or the Decree 320's effective date (15 December 2025). If the enterprise's 2025 tax year begins after the effective date of the CIT Law, the application commences from the effective date of the CIT Law or from the effective date of the Decree.

Decree 265, stipulating eligible expense items, documentation requirements and procedures for applying the R&D Super Deduction, became effective on 14 October 2025. It also requires enterprises to submit R&D-related information dossiers to the tax authorities to access this policy. However, neither Decree 320 nor Decree 265 clearly specifies the deadline for dossier submission, nor do they clarify whether formal confirmation by the tax authorities on the information dossiers is required.

Current regulations do not yet provide further guidance on the treatment of R&D expenses incurred before the effective date of Decree 265.

Interactions with the QDMTT policies

If an enterprise group is within scope of the global minimum tax regime, the application of the 200% R&D expense deduction in 2025 would reduce the enterprise's CIT payable, thereby lowering the effective tax rate (ETR) for QDMTT computation purposes. If the group is required to pay QDMTT, the Super Deduction in 2025 may have limited net effect because the reduced CIT liability could be offset by additional top-up tax under the QDMTT mechanism.

However, the Organisation for Economic Co-operation and Development (OECD) Guidance issued on 5 January 2026 on the Side-by-Side Package introduced the concept of Qualified Tax Incentives. Under this approach, ETR calculations may be adjusted so as not to undermine the effectiveness of qualified cost-based CIT incentive policies, such as R&D Super Deduction. If Vietnam codifies these rules in 2026 for application to QDMTT calculations from 2026 onward, the R&D Super Deduction could generate substantive tax benefits to enterprises. (For background, see EY Global Tax Alert, OECD releases Side-by-Side Package on Pillar Two Global Minimum Tax: Detailed review, dated 16 January 2026.)

Implications

Investors should evaluate the eligibility of R&D expenditures for the Super Deduction and ensure full compliance with the prescribed conditions. In addition, enterprises should stay abreast of further guidance from the competent authorities regarding timelines and procedural requirements, in addition to maintaining comprehensive and well-documented R&D information dossiers.