Many foreigners, when receiving a working invitation from tax authorities or the police, often share the same concern: “Am I facing a tax evasion charge?”
In reality, the line between administrative tax violations and criminal tax evasion is not always clear—especially for those unfamiliar with Vietnam’s legal system.
Sign 1: Intentional Conduct to Misstate Tax Obligations
Under the Criminal Code 2015 (as amended), the most critical element of tax evasion is intent.
This means:
- Not every tax error constitutes a crime
- But if there are signs of “knowing but still doing,” the legal risk increases significantly
Common indicators include:
- Knowing that declaration is required but intentionally failing to declare
- Being aware that figures are incorrect but still signing off
- Actively instructing staff to adjust accounting data
For foreigners, “intent” is sometimes misunderstood, especially when:
- They are not directly handling accounting matters
- They are unfamiliar with Vietnamese tax regulations
However, lack of understanding of the law does not always exclude legal liability.
Sign 2: Use of Illegal Invoices or Supporting Documents
This is one of the most common signs in tax evasion cases.
Such conduct may include:
- Purchasing input invoices to legitimize expenses
- Using invoices issued by “shell” companies
- Issuing invoices that do not reflect actual transactions
In many cases handled by DEDICA, clients stated that they:
- Did not directly carry out the acts
- Or simply signed documents based on accountants’ advice
However, if you are:
- The legal representative
- A director or business owner
you may still be subject to legal responsibility.
Sign 3: Failure to Declare or Underreport Actual Revenue
Another important indicator is the discrepancy between actual revenue and declared revenue.
Common situations include:
- Selling goods or services without issuing invoices
- Receiving payments through personal or overseas accounts
- Operating online businesses without proper tax declaration
This is a frequent risk for foreigners doing business in Vietnam, particularly in:
- E-commerce
- Cross-border consulting services
- Restaurants, bars, and hospitality businesses
Sign 4: Signs of Concealing or Destroying Documents
During interactions with authorities, actions such as:
- Failing to provide requested documents
- Destroying accounting records or supporting documents
- Delaying or avoiding meetings
may be viewed as attempts to conceal violations.
This can:
- Increase the seriousness of the case
- Negatively affect the investigation process
What Should Foreigners Do If There Are Signs of Tax Evasion Risk?
If you notice one or more of the signs above, the most important thing is not to wait until formal charges are brought before taking action.
Early intervention can make a significant difference in the legal outcome.
Do Not Jump to Conclusions – Assess the Situation Properly
Not all signs mean that you have committed a criminal offense.
In practice, many cases:
- Are handled as administrative violations
- Can be remedied through corrections and additional filings
To determine the actual risk, it is necessary to consider:
- The amount of tax involved
- The level of individual involvement
- The specific context and supporting documents
Avoid Common Mistakes When Working with Authorities
Some common mistakes foreigners make include:
- Providing explanations without legal advice
- Submitting incomplete or uncontrolled documentation
- Signing statements without fully understanding the content
Language barriers can also cause you to:
- Misinterpret questions
- Provide inaccurate responses
- Unintentionally create legal disadvantages
Build a Legal Strategy as Early as Possible
An appropriate strategy may include:
- Reviewing all tax and accounting records
- Assessing potential criminal exposure
- Preparing a plan for working with investigative authorities
- Considering remedial measures
In many cases, proactively:
- Correcting errors
- Paying outstanding taxes
may be considered mitigating factors.
DEDICA – Supporting Foreign Clients in Tax Evasion Matters in Vietnam
When facing tax evasion concerns—especially in an unfamiliar legal environment like Vietnam—you need more than knowledge; you need a team that understands how the system works in practice.
DEDICA is a law firm based in Ho Chi Minh City, with experienced lawyers specializing in:
- Criminal defense and legal advisory
- Supporting foreign clients in dealing with authorities
- Resolving disputes and legal risks in business operations
We have supported clients in situations such as:
- Being invited to work with tax authorities
- Being investigated for alleged tax evasion
- Being involved in criminal cases as related parties
DEDICA understands that:
- You may not be familiar with Vietnam’s legal system
- You may be under significant psychological pressure
- You need clear and practical explanations
Therefore, our approach is always:
- Providing realistic assessments without exaggerating risks
- Not promising outcomes, but offering practical legal direction
- Getting involved early to protect your rights effectively
Disclaimer: This article is for informational purposes only. Each case has its own specific facts and should be evaluated by a qualified lawyer before any legal conclusions are made.
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