WHAT DO YOU NEED TO DO WHEN THE WAREHOUSE AND THE COMPANY’S HEADQUARTER ARE NOT AT THE SAME ADDRESS?

My company is trading in furniture products, located in Danang city. In the process of operation, the number of goods and products is rapidly increasing and our demands in exporting and transferring the goods and products are also higher, leading to the need of renting a new warehouse. So, my company has rented a warehouse in Nghe An Province. There are a lot of business activities in the warehouse such as export-import, purchasing… but the revenue and the costs are accounted for the company. We would like to know if we have to register or announce to any agencies when the warehouse and the company’s headquarter are not at the same address and what the procedure is. Thank you.

FDVN’s opinions:

Thank you for concerning FDVN’s legal services. Regarding your consulting requests, after studying the relevant legal documents, FDVN Law Firm would like to give you the following advice:

[1]. If your company does the business in the warehouse:

According to the provisions of Clause 16, Article 4 of Law on Enterprise 2014: “Business means the continuous execution of one, some, or all of the stages of the investment process such as manufacturing, selling products or services on the market to earn profit.”

It will be considered that your company does business at the new address if it rents a warehouse out of the company. So, you have to carry out the procedure of registering a new business address.

Procedures for registration of business locations are specified in Clause 2, Article 33 of the Decree No. 78/2015/NĐ-CP on enterprise registration, amended and supplemented by Clause 9, Article 1 of Decree No. 108/2018/NĐ-CP on amendments to some articles of The Government’s Decree No. 78/2015/ND-CP dated September 14, 2015 on enterprise registration:

“2. Notification of establishment of business location:

The business location of an enterprise may be located outside its headquarters. Within 10 working days from the date of establishment of business location, the enterprise shall send a notification to the Business Registration Office of the area where the business location is located. The notification shall contain:

a) The enterprise ID number;

b) Name and address of the enterprise’s headquarters or branch (if the business location is located in a province where the enterprise’s branch is located);

c) Name and address of the business location;

d) Business lines of the business location;

dd) Full name, residence, ID number/passport number or number of another ID paper of the head of the business location;

e) Full name and signature of the legal representative of the enterprise if the business location is affiliated to the enterprise; full name, signature of the head of the branch if the business location is affiliated to the branch.

3. After receiving satisfactory documents from the enterprise, Business Registration Office shall enter information into the National Enterprise Registration Information System in order to request an ID number of the branch/representative office/business location. Within 03 working days from the receipt of satisfactory documents, Business Registration Office shall issue the certificate of registration of the branch/representative office or update information about the business location on the National Enterprise Registration Database. Business Registration Office may issue a certificate of registration of business located at the request of the enterprise.

4. In case the enterprise establishes a branch/representative office in a province other than the province in which its headquarters is located, the Business Registration Office of the province where the branch/representative office is located shall send information to the Business Registration Office of the province where the enterprise’s headquarters is located.

5. Establishment of overseas branches/representative offices shall comply with the law of the host country.

Within 30 working days from the official opening date of the overseas branch/representative office, the enterprise must send a written notification to the Business Registration Office. The notification must be enclosed with a legitimate copy of the certificate of registration of branch/representative office or an equivalent document in order to update information about the enterprise’s branches and representative offices on National Enterprise Registration Database.”

[2]. If the warehouse is used for storing goods and declaring, paying taxes:

According to Point a, b, Clause 2, Article 5, Circular No. 95/2016/TT-BTC on the guidance of tax registration:

“a) The taxpayer shall use its TIN for the purposes of filing tax returns, remitting payments, requesting refunds, and following other tax formalities regarding all types of amounts payable to government budget, even if the taxpayer does businesses in multiple administrative divisions.

b) If an enterprise or organization that is issued with a TIN engages in new business or expand the business to another province or city without the establishment of any branch or affiliated entity, or with the establishment of an affiliated producing facility (including processing or assembling facility) in another administrative division different from the province or city where it has its head office located that is an entity permitted to keep records of government budget revenues as prescribed in the Law on Tax administration, it is permitted to use the TIN for the purpose of filing tax returns and remitting payments to the tax authority at the administrative division where new business or expanded business is operating.”

On the other hand, according to point a, Clause 1, Article 2, Circular No. 26/2015/TT-BTC on the guidance of VAT and tax management in Decree No. 12/2015/NĐ-CP dated February, 12, 2015:

“a) Point dd Clause 1 of Article 11 is amended as follows:

“dd) Where the taxpayer engages in an extra-provincial construction, installation, or sale with the value of VND 1 billion or higher inclusive of VAT, or extra-provincial real estate transfer (except for the case in Point c Clause 1 of this Article) without establishing an affiliate in that province (hereinafter referred to as extra-provincial business), the taxpayer must submit a tax declaration to the tax authority of the locality where the extra-provincial business takes place.

Directors of local Departments of Taxation shall decide the place where tax on extra-provincial business is declared.”

Therefore, in your case, if the warehouse is rented for storing goods, the company has to must submit a tax declaration and pay tax to the tax authority of the locality where the warehouse is located.  

Above is FDVN Law Firm's opinion for your consulting requests based on studying the relevant legal provisions. Hopefully, FDVN's advice would be helpful to you.

Legal advisor: Dinh Thi Thong - FDVN Law Firm

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