{"id":2665,"date":"2025-12-18T19:22:49","date_gmt":"2025-12-19T02:22:49","guid":{"rendered":"https:\/\/giaodichlienket.man.net.vn\/?p=2665"},"modified":"2025-12-18T19:22:49","modified_gmt":"2025-12-19T02:22:49","slug":"quy-dinh-chi-phi-lai-vay-bi-khong-che","status":"publish","type":"post","link":"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/","title":{"rendered":"Understanding the regulations regarding limits on interest expense deductions is crucial to avoiding construction tax risks."},"content":{"rendered":"<p><span style=\"font-weight: 400;\">In construction accounting practice, interest expense is subject to limitations. <a href=\"https:\/\/thuvienphapluat.vn\/van-ban\/Doanh-nghiep\/Nghi-dinh-132-2020-ND-CP-quy-dinh-quan-ly-thue-doi-voi-doanh-nghiep-co-giao-dich-lien-ket-452218.aspx\" rel=\"nofollow noopener\" target=\"_blank\">Decree 132\/2020\/ND-CP<\/a> Interest expense is one of the biggest yet often underestimated tax risks. A single error in identifying related-party transactions, calculating EBITDA, or tracking carry-forward interest can lead to the disqualification of expenses, back taxes on corporate income, and significant late payment penalties. Based on experience advising and handling tax audits for numerous construction companies, this article will analyze the legal basis, calculation methods, and practical application to help accountants and business owners understand, correctly implement, and legally optimize the handling of interest expense subject to limitations under Decree 132\/2020\/ND-CP.<\/span><\/p>\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Index<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewbox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewbox=\"0 0 24 24\" version=\"1.2\" baseprofile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#The_nao_la_chi_phi_lai_vay_bi_khong_che\" >What does it mean for interest expense to be capped?<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Co_so_phap_ly_va_pham_vi_ap_dung\" >Legal basis and scope of application<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Doi_tuong_bi_tac_dong_boi_quy_dinh_chi_phi_lai_vay_bi_khong_che\" >Those affected by the regulation on capped interest expense<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Phan_tich_chi_tiet_quy_dinh_khong_che_chi_phi_lai_vay\" >Detailed analysis of regulations controlling interest expense.<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Nguong_khong_che_30_EBITDA\" >Control threshold 30% EBITDA<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Y_nghia_cua_con_so_30\" >The meaning of the number 30%\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Quy_tac_chuyen_chi_phi_lai_vay_sang_ky_sau\" >Rules for carrying forward interest expense to the next period.<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Dac_thu_chi_phi_lai_vay_trong_Doanh_nghiep_xay_dung\" >The specifics of interest expense in construction companies.<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Bai_toan_Lai_vay_hoa_gia_thanh_Von_hoa_theo_VAS_16\" >The problem of interest expense accounting (Capitalization according to VAS 16)<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Giao_dich_lien_ket_tiem_an_trong_nganh_xay_dung\" >Potential related-party transactions in the construction industry.<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Huong_dan_ky_thuat_tinh_toan_va_ke_khai_thue\" >Technical guide for calculating and filing taxes.<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Buoc_1_Xac_dinh_cac_moi_quan_he_lien_ket\" >Step 1: Identify the relationships between people.<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-13\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Buoc_2_Tap_hop_du_lieu_tai_chinh\" >Step 2: Gather financial data<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-14\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Buoc_3_Tinh_toan_EBITDA_va_nguong_khong_che\" >Step 3: Calculate EBITDA and control thresholds.<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-15\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Buoc_4_Ke_khai_To_khai_giao_dich_lien_ket_Mau_so_01\" >Step 4: Fill out the Related Party Transaction Declaration Form (Form No. 01)<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-16\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Nhung_sai_lam_thuong_gap\" >Common mistakes\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-17\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Giai_phap_toi_uu_hoa_chi_phi_cho_Doanh_nghiep_Xay_dung\" >Cost-effective solutions for construction companies.<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-18\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Ket_luan\" >Conclude<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-19\" href=\"https:\/\/giaodichlienket.man.net.vn\/en\/quy-dinh-chi-phi-lai-vay-bi-khong-che\/#Thong_tin_lien_he_MAN_%E2%80%93_Master_Accountant_Network\" >Contact information MAN \u2013 Master Accountant Network<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2><span class=\"ez-toc-section\" id=\"The_nao_la_chi_phi_lai_vay_bi_khong_che\"><\/span><b>What does it mean for interest expense to be capped?<\/b><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><a href=\"https:\/\/giaodichlienket.man.net.vn\/en\/chi-phi-lai-vay-bi-khong-che-quy-dinh-moi-nhat-2025\/\"><span style=\"font-weight: 400;\">Interest expense is controlled<\/span><\/a><span style=\"font-weight: 400;\"> (<\/span><span style=\"font-weight: 400;\">usually 30% EBITDA<\/span><span style=\"font-weight: 400;\">This is a regulation on corporate income tax (CIT) in Vietnam, limiting the portion of interest expense (from related parties and independent parties) that businesses can deduct when determining taxable income, aiming to restrict transfer pricing and taxable income, and mainly applied to businesses with related-party transactions.<\/span><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Co_so_phap_ly_va_pham_vi_ap_dung\"><\/span><b>Legal basis and scope of application<\/b><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<figure id=\"attachment_2669\" aria-describedby=\"caption-attachment-2669\" style=\"width: 1200px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-2669\" src=\"https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Co-so-phap-ly-quy-dinh-chi-phi-lai-vay-bi-khong-che-theo-Nghi-dinh-132.jpg\" alt=\"C\u01a1 s\u1edf ph\u00e1p l\u00fd quy \u0111\u1ecbnh chi ph\u00ed l\u00e3i vay b\u1ecb kh\u1ed1ng ch\u1ebf theo Ngh\u1ecb \u0111\u1ecbnh 132\" width=\"1200\" height=\"800\" srcset=\"https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Co-so-phap-ly-quy-dinh-chi-phi-lai-vay-bi-khong-che-theo-Nghi-dinh-132.jpg 1200w, https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Co-so-phap-ly-quy-dinh-chi-phi-lai-vay-bi-khong-che-theo-Nghi-dinh-132-300x200.jpg 300w, https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Co-so-phap-ly-quy-dinh-chi-phi-lai-vay-bi-khong-che-theo-Nghi-dinh-132-1024x683.jpg 1024w, https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Co-so-phap-ly-quy-dinh-chi-phi-lai-vay-bi-khong-che-theo-Nghi-dinh-132-768x512.jpg 768w, https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Co-so-phap-ly-quy-dinh-chi-phi-lai-vay-bi-khong-che-theo-Nghi-dinh-132-18x12.jpg 18w\" sizes=\"auto, (max-width: 1200px) 100vw, 1200px\" \/><figcaption id=\"caption-attachment-2669\" class=\"wp-caption-text\">The legal basis for regulating the limitation of interest expense is Decree 132.<\/figcaption><\/figure>\n<p><span style=\"font-weight: 400;\">To fully understand the regulations regarding the limitation of interest expense, it is first necessary to identify the currently effective legal documents:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Decree 132\/2020\/ND-CP: This is the &quot;essential&quot; document regulating tax management for enterprises with related-party transactions. It completely replaces Decree 20\/2017\/ND-CP and Decree 68\/2020\/ND-CP.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Law on Tax Administration No. 38\/2019\/QH14: The highest legal framework regarding the tax obligations of enterprises.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Circular 80\/2021\/TT-BTC: Detailed guidance on declaring and fulfilling related tax obligations.<\/span><\/li>\n<\/ul>\n<h4><span class=\"ez-toc-section\" id=\"Doi_tuong_bi_tac_dong_boi_quy_dinh_chi_phi_lai_vay_bi_khong_che\"><\/span><b>Those affected by the regulation on capped interest expense<\/b><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><span style=\"font-weight: 400;\">Many accountants mistakenly believe that all loans are subject to limitations. In reality, the regulation limiting interest expense only applies to businesses with related-party transactions.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In the construction industry, related-party transactions typically take the following forms:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Borrowing from the parent company: To carry out the project, the parent company lends money to the subsidiary at interest rates lower or higher than the market rate.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Borrowing in the name of an individual: Businesses borrow money from their director, contributing members, or their relatives (if they meet the ownership\/management ratio threshold as stipulated in Article 5 of Decree 132\/2020\/ND-CP).<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Contractor ecosystem: General contractors and subcontractors share the same operator or belong to the same Financial Group.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">However, correctly identifying the legal basis and applicable subjects is only the beginning. More importantly, for accountants and construction business owners, the key question is: &quot;How is the interest expense limit calculated?&quot;, &quot;What is the limit and how will any excess be handled during tax settlement?&quot;. To fully answer these questions, let&#039;s delve into the regulations on interest expense limits in Clause 3, Article 16 of Decree 132\/2020\/ND-CP, which directly determines the deductibility of interest expenses when calculating corporate income tax (CIT).<\/span><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Phan_tich_chi_tiet_quy_dinh_khong_che_chi_phi_lai_vay\"><\/span><b>Detailed analysis of regulations controlling interest expense.<\/b><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<figure id=\"attachment_2668\" aria-describedby=\"caption-attachment-2668\" style=\"width: 1200px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-2668\" src=\"https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Phan-tich-chi-tiet-quy-dinh-chi-phi-lai-vay-bi-khong-che.jpg\" alt=\"Ph\u00e2n t\u00edch chi ti\u1ebft quy \u0111\u1ecbnh chi ph\u00ed l\u00e3i vay b\u1ecb kh\u1ed1ng ch\u1ebf\" width=\"1200\" height=\"800\" srcset=\"https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Phan-tich-chi-tiet-quy-dinh-chi-phi-lai-vay-bi-khong-che.jpg 1200w, https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Phan-tich-chi-tiet-quy-dinh-chi-phi-lai-vay-bi-khong-che-300x200.jpg 300w, https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Phan-tich-chi-tiet-quy-dinh-chi-phi-lai-vay-bi-khong-che-1024x683.jpg 1024w, https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Phan-tich-chi-tiet-quy-dinh-chi-phi-lai-vay-bi-khong-che-768x512.jpg 768w, https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Phan-tich-chi-tiet-quy-dinh-chi-phi-lai-vay-bi-khong-che-18x12.jpg 18w\" sizes=\"auto, (max-width: 1200px) 100vw, 1200px\" \/><figcaption id=\"caption-attachment-2668\" class=\"wp-caption-text\">Detailed analysis of regulations on capped interest expense.<\/figcaption><\/figure>\n<p><span style=\"font-weight: 400;\">This is the most crucial aspect that every construction accountant needs to master in order to properly comply with regulations regarding the limitation of interest expense.<\/span><\/p>\n<h4><span class=\"ez-toc-section\" id=\"Nguong_khong_che_30_EBITDA\"><\/span><b>Control threshold 30% EBITDA<\/b><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><span style=\"font-weight: 400;\">Decree 132\/2020\/ND-CP stipulates that the total interest expense after deducting interest on deposits and loans (net interest expense) incurred during the period of the taxpayer is deductible when determining taxable corporate income, provided it does not exceed 30% of total net profit from business operations plus net interest expense plus depreciation expense (EBITDA).<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Recipe:\u00a0<\/span><\/p>\n<table style=\"width: 100%; border-color: #000000;\" border=\"1\" cellspacing=\"2\" cellpadding=\"12\">\n<tbody>\n<tr>\n<td>\n<p style=\"text-align: center;\"><span style=\"font-weight: 400;\">Interest expense is deductible. <\/span><span style=\"font-weight: 400;\">\u2264 30% x EBITDA<\/span><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><span style=\"font-weight: 400;\">In there:\u00a0<\/span><\/p>\n<table style=\"width: 100%; border-color: #000000;\" border=\"1\" cellspacing=\"2\" cellpadding=\"12\">\n<tbody>\n<tr>\n<td>\n<p style=\"text-align: center;\"><span style=\"font-weight: 400;\">EBITDA = Net Profit + Net Interest Expense + Depreciation Expense<\/span><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><span style=\"font-weight: 400;\">Note:\u00a0<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Net profit: Profit from business operations (Code 30 on the Income Statement), note that this does not include profit from financial activities other than interest on loans.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Net interest expense: Total interest expense incurred minus interest on deposits or loans.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Depreciation expense: The cost of depreciation of fixed assets and amortization of goodwill arising during the period.<\/span><\/li>\n<\/ul>\n<h4><span class=\"ez-toc-section\" id=\"Y_nghia_cua_con_so_30\"><\/span><b>The meaning of the number 30%<\/b><span style=\"font-weight: 400;\">\u00a0<\/span><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><span style=\"font-weight: 400;\">Why 30%? This figure is based on the OECD&#039;s recommendation in Action 4 of the BEPS Project (Combating Base Erosion and Profit Shifting). Applying a regulation that limits interest expense to 30% EBITDA helps prevent businesses from artificially inflating interest expenses to reduce their corporate income tax liability in Vietnam.<\/span><\/p>\n<h4><span class=\"ez-toc-section\" id=\"Quy_tac_chuyen_chi_phi_lai_vay_sang_ky_sau\"><\/span><b>Rules for carrying forward interest expense to the next period.<\/b><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><span style=\"font-weight: 400;\">A positive aspect of Decree 132\/2020\/ND-CP compared to previous regulations is that it allows the carry-forward of excluded interest expense.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Any interest expense exceeding the amount specified in tax code 30% will be carried forward to the next tax period.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Transfer period: Not more than 5 consecutive years.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">When carried over, total interest expense (including interest incurred in that period and interest carried over) must still comply with the threshold of not exceeding 30% EBITDA for that year.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Although Clause 3, Article 16 of Decree 132\/2020\/ND-CP clearly stipulates the threshold for deductible interest expenses based on the 30% EBITDA ratio, its application in practice, especially in construction enterprises, raises many complex issues in calculating and determining deductible expenses. The unique characteristics of long project cycles, interest capitalization, phased acceptance, and the ecosystem of related-party transactions mean that interest expenses in construction accounting cannot be calculated mechanically using a general formula, but require deeper analysis from a professional perspective.<\/span><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Dac_thu_chi_phi_lai_vay_trong_Doanh_nghiep_xay_dung\"><\/span><b>The specifics of interest expense in construction companies.<\/b><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<figure id=\"attachment_2667\" aria-describedby=\"caption-attachment-2667\" style=\"width: 1200px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-2667\" src=\"https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Dac-thu-nganh-xay-dung-quy-dinh-chi-phi-lai-vay-bi-khong-che.jpg\" alt=\"\u0110\u1eb7c th\u00f9 ng\u00e0nh x\u00e2y d\u1ef1ng quy \u0111\u1ecbnh chi ph\u00ed l\u00e3i vay b\u1ecb kh\u1ed1ng ch\u1ebf\" width=\"1200\" height=\"800\" srcset=\"https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Dac-thu-nganh-xay-dung-quy-dinh-chi-phi-lai-vay-bi-khong-che.jpg 1200w, https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Dac-thu-nganh-xay-dung-quy-dinh-chi-phi-lai-vay-bi-khong-che-300x200.jpg 300w, https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Dac-thu-nganh-xay-dung-quy-dinh-chi-phi-lai-vay-bi-khong-che-1024x683.jpg 1024w, https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Dac-thu-nganh-xay-dung-quy-dinh-chi-phi-lai-vay-bi-khong-che-768x512.jpg 768w, https:\/\/giaodichlienket.man.net.vn\/wp-content\/uploads\/2025\/12\/Dac-thu-nganh-xay-dung-quy-dinh-chi-phi-lai-vay-bi-khong-che-18x12.jpg 18w\" sizes=\"auto, (max-width: 1200px) 100vw, 1200px\" \/><figcaption id=\"caption-attachment-2667\" class=\"wp-caption-text\">The specific nature of the construction industry dictates that interest expense deductions are subject to limitations.<\/figcaption><\/figure>\n<p><span style=\"font-weight: 400;\">Construction accounting has very different operations compared to trade or services, which directly affects the application of regulations on capped interest expense deductions.<\/span><\/p>\n<h4><span class=\"ez-toc-section\" id=\"Bai_toan_Lai_vay_hoa_gia_thanh_Von_hoa_theo_VAS_16\"><\/span><b>The problem of interest expense accounting (Capitalization according to VAS 16)<\/b><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><span style=\"font-weight: 400;\">In construction, interest expenses are typically capitalized into the value of assets under construction (Account 154 or Account 241) according to Accounting Standard No. 16.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">So, will capitalized interest expenses (not included in account 635 during the period) be included in the 30% threshold of the regulations on limited interest expense deductions?<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">If interest expense has been capitalized into the asset&#039;s value, it is not considered an &quot;expense&quot; in the current period.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">However, when that asset (construction project) is accepted and converted into cost of goods sold (Account 632) or depreciated, the hidden interest expense will be considered.<\/span><\/li>\n<\/ul>\n<p><b>Extremely important note:<\/b><span style=\"font-weight: 400;\"> Accountants need to separate the capitalized interest expense from related-party loans for separate tracking, avoiding double exclusion or omission when calculating corporate income tax later.<\/span><\/p>\n<h4><span class=\"ez-toc-section\" id=\"Giao_dich_lien_ket_tiem_an_trong_nganh_xay_dung\"><\/span><b>Potential related-party transactions in the construction industry.<\/b><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><span style=\"font-weight: 400;\">The Vietnamese construction industry is characterized by the existence of &quot;family-run&quot; or &quot;interconnected ecosystem&quot; models. For example:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Construction company A borrowed money from Mr. Nguyen Van B (Chairman of the Board of Directors) to buy an excavator. If Mr. B owns more than 25% of contributed capital, this is a related-party transaction.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The main contractor subcontracts the work (80%) to a subcontractor, but the subcontractor is owned by the spouse of the main contractor&#039;s director. Any loans between these two parties trigger a regulation limiting interest expense.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">The unique characteristics of interest expense capitalization, long-term project cash flows, and potential related-party transactions within construction businesses make the application of regulations on interest expense deductions far more complex than in other industries. To avoid errors in determining deductible expenses and ensure tax returns stand up to audit, accountants need not only to understand the nature of the business but also to master the calculation techniques and declaration procedures in accordance with legal regulations.<\/span><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Huong_dan_ky_thuat_tinh_toan_va_ke_khai_thue\"><\/span><b>Technical guide for calculating and filing taxes.<\/b><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><span style=\"font-weight: 400;\">To comply with regulations regarding the limitation of interest expense, accountants should follow these four steps:<\/span><\/p>\n<h4><span class=\"ez-toc-section\" id=\"Buoc_1_Xac_dinh_cac_moi_quan_he_lien_ket\"><\/span><b>Step 1: Identify the relationships between people.<\/b><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><span style=\"font-weight: 400;\">Review the list of shareholders, lenders, and borrowers to compare it with Article 5 of Decree 132\/2020\/ND-CP. If there are no related-party transactions, then this 30% threshold does not need to be considered.<\/span><\/p>\n<h4><span class=\"ez-toc-section\" id=\"Buoc_2_Tap_hop_du_lieu_tai_chinh\"><\/span><b>Step 2: Gather financial data<\/b><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><span style=\"font-weight: 400;\">Obtain data from the Balance Sheet and Income Statement:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Net profit from business operations (MS 30).<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Total interest expense (in account 635 and the capitalized debt portion 154\/241).<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Total revenue from interest on deposits and loans (Account 515).<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Total depreciation expense for the period (Depreciation calculation sheet).<\/span><\/li>\n<\/ul>\n<h4><span class=\"ez-toc-section\" id=\"Buoc_3_Tinh_toan_EBITDA_va_nguong_khong_che\"><\/span><b>Step 3: Calculate EBITDA and control thresholds.<\/b><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><span style=\"font-weight: 400;\">Applying the formula mentioned above, businesses can refer to additional detailed formulas along with real-world case studies.<\/span><\/p>\n<blockquote><p><b>See also:<\/b> <a href=\"https:\/\/giaodichlienket.man.net.vn\/en\/cong-thuc-tinh-lai-vay-giao-dich-lien-ket\/\"><span style=\"font-weight: 400;\">Formula for calculating interest on related-party transactions<\/span><\/a><span style=\"font-weight: 400;\">\u00a0<\/span><\/p><\/blockquote>\n<h4><span class=\"ez-toc-section\" id=\"Buoc_4_Ke_khai_To_khai_giao_dich_lien_ket_Mau_so_01\"><\/span><b>Step 4: Fill out the Related Party Transaction Declaration Form (Form No. 01)<\/b><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><span style=\"font-weight: 400;\">This is a mandatory legal step. In Form No. 01 issued with Decree 132, accountants must declare in detail the related parties, transaction values, and especially the determination of deductible interest expenses. Failure to submit this form will result in the assessment of taxes and very high administrative penalties for the business. It must be submitted along with the corporate income tax return.<\/span><\/p>\n<blockquote><p><b>See details<\/b><span style=\"font-weight: 400;\">: <\/span><a href=\"https:\/\/giaodichlienket.man.net.vn\/en\/ke-khai-to-khai-giao-dich-lien-ket\/\"><span style=\"font-weight: 400;\">Instructions for the related-party transaction declaration form.<\/span><\/a><\/p><\/blockquote>\n<p><span style=\"font-weight: 400;\">Although the procedures for calculating and declaring interest expense are clearly defined in Decree 132\/2020\/ND-CP, in practice, many construction companies still face significant tax arrears and penalties due to seemingly minor errors in application. The discrepancy between understanding the regulations and correctly implementing them in tax filings has led to a series of serious errors that accountants need to particularly avoid.<\/span><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Nhung_sai_lam_thuong_gap\"><\/span><b>Common mistakes<\/b><span style=\"font-weight: 400;\">\u00a0<\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><span style=\"font-weight: 400;\">During our consulting and practical work experience, we have observed that accountants often make the following mistakes regarding regulations on capped interest expense:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Interest expense from related parties only: Many people think that only interest paid to the parent company is subject to limits. However, once there are related-party transactions, the total interest expense (including interest from independent banks) is included in the &quot;basket&quot; for calculating the 30% threshold.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Forgetting to offset interest on deposits: The formula for calculating EBITDA is &quot;Net Interest on Borrowed Assets&quot;. If you forget to subtract the interest earned from banks, your company&#039;s EBITDA will be calculated incorrectly, leading to losses for the business.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Failure to track interest expense carried forward: Construction companies often incur losses in the early years of a project (negative EBITDA). In this case, all interest expense is disallowed. If accounting fails to record this to carry forward to the third or fourth year when profits are generated, the company will lose this benefit entirely.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Confusion between accounting EBITDA and tax EBITDA: Certain unreasonable expenses (disallowed for tax purposes) need to be adjusted before calculating EBITDA to ensure they match audit figures.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">These mistakes show that the problem lies not in the regulations limiting interest expense, but in how construction businesses understand and organize their financial structure inappropriately from the outset. By correctly understanding the nature of Decree 132\/2020\/ND-CP, businesses can proactively control tax risks and optimize costs legally. So what are the feasible solutions to help construction businesses comply with regulations without compromising financial efficiency?<\/span><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Giai_phap_toi_uu_hoa_chi_phi_cho_Doanh_nghiep_Xay_dung\"><\/span><b>Cost-effective solutions for construction companies.<\/b><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><span style=\"font-weight: 400;\">To minimize the impact of regulations limiting interest expense deductions and to legally protect tax interests, construction companies cannot simply rely on &quot;accurate calculation and complete declaration,&quot; but need to proactively restructure their finances and optimize cash flow from the outset. Below are some practical solutions:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Increase charter capital: Instead of borrowing from shareholders, convert those loans into equity contributions. This will improve financial statements, enhance bidding capabilities, and eliminate the risk of interest rate caps.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Optimize project cash flow: Utilize guarantees, letters of credit (L\/C), or supply chain financing instead of directly borrowing cash from stakeholders.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Choosing the right time for project completion: In construction, project completion determines revenue and profit. Carefully consider the timing of project completion to generate a sufficiently large EBITDA to absorb all interest expenses for the period.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Borrowing from banks using personal assets: Instead of businesses borrowing directly from individuals, allow individuals to mortgage their assets to the bank so that the business can borrow capital independently (the legal aspects of this transaction need to be carefully assessed).<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">However, all the above solutions for optimizing interest expense are only truly effective when businesses correctly understand the nature of the regulations controlling interest expense and proactively restructure their finances from the outset, instead of reacting passively when tax authorities conduct an audit. This is also why construction companies need to re-evaluate their capital strategy and the role of tax accounting in the long term.<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Ket_luan\"><\/span><b>Conclude<\/b><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">The regulations on interest expense limits under Decree 132\/2020\/ND-CP are not only a tax compliance requirement but also a &quot;measure&quot; of the soundness of a construction company&#039;s financial structure. Misunderstanding or mechanically applying the 30% EBITDA threshold can cause businesses to lose their right to deduct legitimate expenses, face corporate income tax arrears, and create significant risks during tax audits. Conversely, if accountants and business owners understand the nature of the regulations, closely monitor related-party transactions, and proactively plan their cash flow, interest expenses can be legally controlled and optimized.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In the context of construction projects increasingly relying on financial leverage, reviewing loan structures, related-party transaction records, and interest expense calculation methods should be done periodically, rather than waiting for tax authorities to intervene. If businesses are facing difficulties in determining deductible interest expenses, preparing related-party transaction declarations, or preparing explanatory documents for audits, consulting with the expert team at MAN \u2013 Master Accountant Network, who have in-depth knowledge of the construction industry, will help minimize risks and protect tax benefits sustainably.<\/span><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Thong_tin_lien_he_MAN_%E2%80%93_Master_Accountant_Network\"><\/span><b>Contact information MAN \u2013 Master Accountant Network<\/b><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Address: No. 19A, Street 43, Tan Thuan Ward, Ho Chi Minh City<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Mobile\/Zalo: 0903 963 163 \u2013 0903 428 622<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Email: man@man.net.vn<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Content production by: Mr. <\/span><a href=\"https:\/\/man.net.vn\/le-hoang-tuyen\/\" rel=\"nofollow noopener\" target=\"_blank\"><span style=\"font-weight: 400;\">Le Hoang Tuyen<\/span><\/a><span style=\"font-weight: 400;\"> \u2013 Founder and CEO of MAN \u2013 Master Accountant Network, CPA Vietnam with over 30 years of experience in accounting, auditing, and financial consulting.<\/span><\/p>\n<p style=\"text-align: right;\"><b><i>Editorial Board of MAN \u2013 Master Accountant Network<\/i><\/b><\/p>","protected":false},"excerpt":{"rendered":"<p>Trong th\u1ef1c t\u1ebf k\u1ebf to\u00e1n x\u00e2y d\u1ef1ng, chi ph\u00ed l\u00e3i vay b\u1ecb kh\u1ed1ng ch\u1ebf theo Ngh\u1ecb \u0111\u1ecbnh 132\/2020\/N\u0110-CP l\u00e0 m\u1ed9t trong nh\u1eefng r\u1ee7i ro thu\u1ebf l\u1edbn nh\u1ea5t nh\u01b0ng l\u1ea1i th\u01b0\u1eddng b\u1ecb \u0111\u00e1nh gi\u00e1 th\u1ea5p. Ch\u1ec9 m\u1ed9t sai s\u00f3t trong vi\u1ec7c x\u00e1c \u0111\u1ecbnh giao d\u1ecbch li\u00ean k\u1ebft, c\u00e1ch t\u00ednh EBITDA hay theo d\u00f5i l\u00e3i vay chuy\u1ec3n [&hellip;]<\/p>\n","protected":false},"author":4,"featured_media":2666,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-2665","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog"],"acf":[],"_links":{"self":[{"href":"https:\/\/giaodichlienket.man.net.vn\/en\/wp-json\/wp\/v2\/posts\/2665","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/giaodichlienket.man.net.vn\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/giaodichlienket.man.net.vn\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/giaodichlienket.man.net.vn\/en\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/giaodichlienket.man.net.vn\/en\/wp-json\/wp\/v2\/comments?post=2665"}],"version-history":[{"count":1,"href":"https:\/\/giaodichlienket.man.net.vn\/en\/wp-json\/wp\/v2\/posts\/2665\/revisions"}],"predecessor-version":[{"id":2670,"href":"https:\/\/giaodichlienket.man.net.vn\/en\/wp-json\/wp\/v2\/posts\/2665\/revisions\/2670"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/giaodichlienket.man.net.vn\/en\/wp-json\/wp\/v2\/media\/2666"}],"wp:attachment":[{"href":"https:\/\/giaodichlienket.man.net.vn\/en\/wp-json\/wp\/v2\/media?parent=2665"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/giaodichlienket.man.net.vn\/en\/wp-json\/wp\/v2\/categories?post=2665"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/giaodichlienket.man.net.vn\/en\/wp-json\/wp\/v2\/tags?post=2665"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}