Why You Should Set Up an IT Company in Vietnam
What makes Vietnam a suitable location for your IT company?
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The IT sector in Vietnam is growing at a rapid pace with no signs of slowing. Vietnam has even become one of the top providers of IT services globally. With competitive rates for high-quality workers, many investors are looking to set up an IT company in Vietnam.
Below, we discuss the requirements and regulations to set up an IT company in Vietnam. In addition to that, we will also discuss incentives available to IT companies in Vietnam. We will also provide alternatives to setting up a company in Vietnam.
Foreign Ownership of IT Companies in Vietnam
Vietnam allows foreign ownership in most industries including IT. Recently, the government updated Vietnam’s Law on Investment to simplify the investment process. This will take effect in January 2021.
Requirements to Set Up an IT Company in Vietnam
Vietnam has several business structures from which investors can choose. For this article, we will focus on the process to register a limited liability company (LLC) in Vietnam.
These are the requirements to set up an LLC in Vietnam:
- A registered business address. You need a valid business address to incorporate a company in Vietnam. For an IT company, you may use a virtual office address. IT companies with physical locations often set up their offices in the IT parks in Da Nang, Hanoi, or Ho Chih Minh City.
- At least 1 founder. An LLC must have at least 1 but no more than 50 founders.
- Founder’s personal documents. Each founder must submit an authenticated copy of their passports and bank statements.
- A resident director. All LLCs must have at least one resident director. The resident director must submit a work permit if he or she is a foreigner and not a founder of the company.
- Reasonable capital. Vietnam does not have a minimum capital requirement for IT companies. However, the business must propose a reasonable amount. The proposed capital must cover all costs until the company starts to make a profit.
- Investment Registration Certificate and Business Registration Certificate. All LLCs must apply for these certificates. The Department of Planning and Investment (DPI) issues these. It takes about a month to get these certificates.
Consult with us about company registration in Vietnam.
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Incentives for IT Companies in Vietnam
Vietnam’s government aims to further boost development in the IT sector. One way to encourage investment into the industry is by offering incentives to IT companies.
Note that a company must meet certain requirements to enjoy incentives. IT companies involved in the following are eligible for incentives:
- Production of software products
- Digital information content products
- Key information technology products
- Software services
- Information security incident correction services,
- Information security protection per regulations of Law on Information Technology
Incentives for eligible IT companies include the following:
- Corporate income tax exemption for 4 years
- Reduced corporate income tax for 11 years following the period of exemption
- Investment credits
Get in touch with us to learn more about incentives for IT companies in Vietnam. Our consultants will help you maximize the incentives offered to qualified companies. Fill out the form below or send us an email at [email protected].
Hiring Software Developers in Vietnam
Vietnam has also become the leading source for software developers in Southeast Asia. This is because of the competitive wages and Vietnam’s young workforce. Moreover, education in Vietnam also provides access to learn and develop IT skills leading to an increasing number of IT professionals.
With a competitive job market, finding high-quality software developers in Vietnam is challenging. A simple solution is to work with a professional recruiter in Vietnam. Emerhub has experienced recruiters who can help you find top software engineers in Vietnam.
Below, you will see the typical recruitment process for Emerhub:
- Sourcing IT professionals in Vietnam. Emerhub will source candidates for you using our professional networks.
- Screening potential software developers. Our recruiters will assess potential candidates. We will then provide you with a list of the most promising applicants for you to review.
- Scheduling interviews. We will schedule interviews with your chosen candidates.
- Facilitating tests. We can also assist in administering tests and examinations to further assess the candidates.
- Preparing job offers. Our consultants will make recommendations based on the salary standards in Vietnam. This is to ensure that you will create a competitive compensation package to offer successful candidates.
- Preparing employment contracts. We will help you draft employment contracts with consideration to Vietnam’s labor regulations.
Should you have specific requirements not included in the steps above, we can customize the recruitment process for you.
Hire software developers in Vietnam.
Recruit top IT candidates in Vietnam through Emerhub.
Alternatives to Setting Up a Company
There are other ways to do business in Vietnam aside from setting up a company. You can hire remote Vietnamese IT workers or set up an offshore office in Vietnam.
Hire Remote IT Professionals in Vietnam
You can hire remote software developers in Vietnam through an employer of record. An employer of record is an entity that hires workers on your behalf. Emerhub can be your employer of record in Vietnam.
Our employer of record service includes:
- Recruitment and background checks
- Payroll, filing of local taxes, and other compensations
- Work and visa permits
- Employment contracts
Open a Representative Office in Vietnam
Another option is to open a representative office in Vietnam. This is an office set up by a parent company abroad. A representative office cannot generate income in Vietnam. However, it can hire local and foreign employees. This is a suitable option for foreign companies that want to set up an offshore office.
Ready to start your IT company in Vietnam? Find out more by getting in touch with us at [email protected] and our team will be ready to assist you.
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