Can Directors Be Criminally Liable for Tax Evasion in Vietnam?

If you are a company director or legal representative in Vietnam, you may be wondering: if your company is investigated for tax evasion, can you personally face criminal liability?

This is not only a common concern but also a real situation that DEDICA Law frequently handles, especially for foreign clients. So where is the line between corporate liability and personal responsibility? And more importantly, what should you do right now?

1. When Can a Director Be Criminally Liable for Tax Evasion?

Not every tax violation committed by a company automatically leads to criminal liability for its director. However, in certain circumstances, responsibility may shift from the legal entity to the individual in charge.

1.1. Legal Grounds for Tax Evasion in Vietnam

Under the 2015 Criminal Code of Vietnam (as amended in 2017), tax evasion may result in criminal charges if:

• There are fraudulent acts to reduce tax payable (false declarations, failure to declare, use of illegal invoices, etc.)
• The evaded tax amount reaches the statutory threshold (from VND 100 million or repeated violations)
• There is intentional fault

An important point that many foreign business owners overlook is that Vietnamese law allows both commercial legal entities and individuals to be criminally prosecuted.

This means:

• The company may face fines or suspension of operations
• Individuals such as the director, chief accountant, or anyone directly instructing the evasion may be prosecuted separately

1.2. Being a Director Does Not Automatically Mean Liability – “Intent” Is Key

A common misconception is that being a director automatically leads to criminal responsibility.

In reality, authorities will assess several factors:

• Whether you knew about and directed the tax evasion
• Whether you approved or signed false documents
• Whether you benefited from the conduct
• Whether there is evidence of intentional concealment

If you are only a nominal director without actual operational control, your liability may be assessed differently.

However, if you actively manage the company, sign documents, or knowingly allow tax evasion, the criminal risk becomes significantly higher.

2. What Should Foreign Directors in Vietnam Pay Special Attention To?

This is a key group that DEDICA Law regularly advises and also one that faces higher risks due to differences in legal systems.

2.1. The Risk of Not Knowing the Law but Still Being Liable

Many foreign clients have shared that they were not aware of the complexity of Vietnam’s tax system.

However, under Vietnamese law, lack of knowledge is not a defense against liability.

Typical situations include:

• Delegating all accounting work to a third party without supervision
• Signing documents without careful review
• Trusting internal staff without proper control processes

These actions can unintentionally make you the person held primarily responsible.

2.2. Exposure to Strict Procedural Measures

In tax evasion cases, especially those involving foreign elements, authorities may impose:

• Exit bans
• Temporary detention or custody
• Multiple summons for questioning

These measures can significantly affect business operations, personal reputation, and immigration status in Vietnam.

For foreign individuals, this is not just a legal issue but also a matter of living and working stability.

3. How Can DEDICA Law Assist When a Director Is Under Investigation?

If you or your loved one is in this situation, the most important thing is not panic but having the right legal strategy from the beginning.

3.1. Assessing Criminal Risk and Building a Defense Strategy

DEDICA can support you by:

• Reviewing documents, financial records, and cash flow
• Identifying your actual role within the company
• Assessing the likelihood of criminal liability

Based on this, lawyers will propose appropriate strategies such as:

• Providing explanations to exclude personal liability
• Demonstrating lack of intent
• Mitigating liability where violations exist

3.2. Working with Authorities While Protecting Your Legal Rights

A common mistake is attending meetings with authorities without legal support or signing statements without fully understanding their content.

DEDICA will:

• Accompany you during working sessions
• Help prepare appropriate explanations
• Ensure your rights are protected throughout the process

For foreign clients, DEDICA’s legal team has experience working in international environments and can explain your rights and obligations in a clear and practical way.

4. What Should You Do Immediately If You Are Suspected of Tax Evasion?

If you are reading this, you or someone close to you may already be in a sensitive situation. The following steps are important.

4.1. Do Not Conceal but Do Not Make Uninformed Statements

• Do not destroy documents
• Do not provide information without legal guidance
• Do not rely on unqualified advice

Every statement you make may later be used as evidence.

4.2. Seek Legal Counsel as Early as Possible

In criminal cases, especially tax evasion matters, timing is critical.

The earlier you engage a lawyer, the better your position. Delays can make the situation more difficult to manage.

DEDICA has supported many cases where:

• Foreign clients were incorrectly assessed in their roles
• Individuals were held liable despite not directly committing the acts
• Liability was reduced or avoided thanks to appropriate legal strategy

Important Legal Disclaimer

This article is for general informational purposes only and does not constitute legal advice. Each case involves specific facts and should be assessed individually by qualified legal professionals.

Are You Facing a Similar Situation?

If you are a foreign individual who is:

• Being invited to work with authorities regarding tax evasion
• Concerned about criminal liability as a company director
• Or have a family member under investigation in Vietnam

Do not wait until the situation escalates.

Contact DEDICA Law Firm for Professional Legal Support

📞 Hotline: (+84) 39 969 0012 (Available via WhatsApp, WeChat, Zalo)

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Contact us today for a free initial consultation with our experienced lawyers!