Tax Evasion in Vietnam: What Penalties Beyond Jail Can Apply?

Tax evasion does not only carry the risk of imprisonment—it can also lead to a range of serious legal consequences. Are you worried about what additional penalties you or your loved ones may face? Understanding the risks is the first step to protecting yourself.

What Legal Consequences Beyond Imprisonment Can Tax Evasion Trigger in Vietnam?

When people think about tax evasion, especially foreigners living or doing business in Vietnam, they often focus only on the possibility of imprisonment. However, under Vietnamese law, imprisonment is not the only consequence.

In many cases handled by DEDICA Law, clients were surprised to learn that they could also face significant additional penalties—ranging from substantial fines and business restrictions to even deportation from Vietnam.

So, what exactly are these additional penalties under Vietnamese law? And what risks should foreigners be particularly aware of?

Legal Basis for Tax Evasion Under Current Vietnamese Law

Tax evasion is regulated under Article 200 of the 2015 Criminal Code (as amended in 2017). Depending on the amount of tax evaded and aggravating factors, individuals may face criminal liability.

In addition to the principal penalties (fines or imprisonment), the law also allows courts to impose supplementary penalties.

It is important to understand that:
The court will consider the entire case—including the nature of the conduct, severity, consequences, and personal circumstances—before deciding whether and how to apply these penalties.

Why Supplementary Penalties Can Be More Concerning Than Imprisonment

Many clients at DEDICA initially focus only on whether they will go to jail. However, they often overlook the fact that:

• Financial penalties can reach significant amounts
• Business operations may be completely disrupted
• Reputation and credibility may be severely damaged
• For foreigners: legal status and residency in Vietnam may be affected

In other words, even without imprisonment, supplementary penalties can cause long-term financial and operational consequences.

Supplementary Penalties for Tax Evasion and How to Mitigate Legal Risks

Understanding these penalties is essential if you want to proactively manage legal risks. Below are the most common supplementary penalties under Vietnamese law.

Additional Fines – The Biggest Financial Burden

Under Article 200, in addition to the principal penalty, offenders may be subject to:

• Additional fines ranging from VND 20 million to VND 100 million (or higher depending on the case)
• Full repayment of the evaded tax amount, plus late payment interest

In practice, the total financial obligation may include:

• Back taxes
• Administrative penalties
• Late payment interest
• Additional fines

This is why many foreign businesses face serious financial strain after a tax evasion case.

Prohibition from Holding Positions or Conducting Business

One often overlooked but highly impactful penalty is:

• Prohibition from holding certain positions
• Prohibition from practicing certain professions
• Restrictions on conducting business in specific sectors (from 1 to 5 years)

This is particularly critical for:

• Business owners
• Directors of foreign-invested companies (FDI)
• Legal representatives

Such restrictions can effectively halt or terminate business operations in Vietnam.

Confiscation of Assets Related to the Offense

In certain cases, authorities may:

• Confiscate assets linked to the tax evasion
• Freeze bank accounts
• Seize assets for investigation purposes

This usually occurs when:

• The evaded tax amount is significant
• There are signs of asset concealment
• The case involves organized or cross-border elements

For foreigners, this can be especially sensitive as it may impact assets both within and outside Vietnam.

Risk of Deportation for Foreign Nationals

This is a major concern for many international clients.

Under Vietnamese law, deportation may be applied as a supplementary penalty or administrative measure in certain cases.

This means:

• You may be required to leave Vietnam
• Your ability to re-enter may be restricted
• Long-term business and investment plans may be disrupted

For those managing businesses in Vietnam, this can lead to a complete breakdown of operations.

What Should You Do If You Are Under Investigation?

If you or someone close to you is in any of the following situations:

• Being invited by the police for questioning
• Subject to a tax inspection or audit
• Suspected of tax evasion
• Already under investigation or prosecution

The most important step is not avoidance—but taking the right approach from the beginning.

Key recommendations:

• Do not provide statements without legal advice
• Prepare complete and consistent documentation
• Consider remedial actions (e.g., tax repayment, cooperation)
• Engage a lawyer to develop an appropriate legal strategy

Disclaimer: Each case is unique. Outcomes depend on multiple factors, and there is no universal solution applicable to all situations.

The Role of Lawyers in Minimizing Supplementary Penalties

In many cases handled by DEDICA Law, early legal involvement has helped clients:

• Clearly understand their rights and obligations
• Avoid critical mistakes during investigations
• Develop appropriate remedial strategies
• Minimize the risk of additional penalties

For foreign clients, language barriers and differences in legal systems can make matters significantly more complex.

With a team of lawyers experienced in international law firms and multinational corporations, DEDICA regularly supports clients in:

• Legal advisory for foreigners in Vietnam
• Criminal defense representation
• Protecting victims’ rights in criminal cases

We understand that what clients need is not just legal knowledge—but a practical strategy tailored to their specific situation.

Contact DEDICA Law Firm for Professional Legal Support

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

🕒 Working Hours: Monday – Friday (8:30 – 18:00)

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