May 2013

Tax Alert



New rules on depreciation of fixed
assets

On 25 April 2013 the Ministry of Finance (MOF) issued Circular
45/2013/TT-BTC (Circular 45) providing a regime on management,
use and depreciation of fixed assets. Circular 45 shall take effect from
10 Jun 2013 and apply from the fiscal year 2013 onwards.
Generally, most contents of Circular 45 are based on the guidance
provided in Circular 203/2009/TT-BTC. However, there are certain
additional salient points some of which are noted below.
Higher fixed assets historical cost threshold
Circular 45 increases the historical cost threshold from VND10 million
to VND30 million.
As a result, Circular 45 provides that for fixed assets which are
currently monitored, managed and depreciated under Circular
203/2009/TT-BTC and now do not qualify fixed assets, the residual
value of these assets is allocated into the production cost of the
enterprise for a maximum period of 3 years from the effective date of
Circular 45.
Intangible fixed assets being land use rights
The assets are that houses and land for selling or trading by the real
estate enterprises are not accounted for as fixed assets and are not
amortized.


At a glance
Circular 45/2013/TT-BTC
which replaces Circular
203/2009/TT-BTC takes
effect from 10 June 2013
and applies from financial
year 2013 onwards.
Circular 45 provides
amongst other things,
some changes regarding
fixed assets historical cost
threshold replaces, and
useful life of fixed assets.


May 2013 Tax Alert Page 2

Useful life of fixed assets
Some increase regarding maximum useful life of fixed assets as
provided under Appendix 1 of Circular 45 are as follows:
Motive machinery and equipment: from 10 years up to 15 or 20
years.
Working machinery and equipments: increasing up to 15 or 20
years instead of 8 or 10 years.
Electric and electronic equipment & specialized equipments used
for special purposes: from 08 years to 10 years.
In addition, the useful life of other intangible fixed assets from 2 years
to 20 years is also provided.
If you have any queries around these changes and the impacts on
your business, please feel free to contact us.

May 2013 Tax Alert Page 3


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contact:
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