© VDB LOI CO., LTD 2016
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted,
in any form or by any means – electronic, mechanical, photocopying, recording or otherwise – without theprior written permission of the publisher or copyright holder. This publication, and any form of copy of thispublication, may not be sold, re-sold, hired out or otherwise disposed of by way of trade, by any person orentity, without the prior written permission of the publisher or copyright holder.
Published by VDB Loi Co., Ltd June 2016
Printed in Cambodia by Nova (Cambodia) Co., Ltd.

Quick Reference Tax Rate Tables
Profit tax
Description
Standard rate
Tobacco companies
Freelancers & sole-trader
enterprises

Rates
24%
26%
Progressive rates of 0% to 24%

Lump-sum tax
Annual turnover(LAK)

Lump-sum tax rates
Manufacturing

TradingServices

Less than 12,000,000
ExemptExemptExempt12,000,001 –Fixed amount – but not exceeding
50,000,000
LAK600,000 per year
50,000,001 –3%
4%
5%120,000,000
120,000,001 –4%5%
6%240,000,000
240,000,001 –5%6%
7%400,000,000

Page 1

Employee income tax

Level

1
2
3
4
5
6
7

Page 2

TaxableSalary at
Each Level(LAK)

Basis ofCalculation(LAK)

1,000,000
1,000,000
and below
1,000,001 –2,000,000
3,000,000
3,000,001 –3,000,000
6,000,000
6,000,001 –6,000,000
12,000,000
12,000,001 –12,000,000
24,000,000
24,000,001 –16,000,000
40,000,000
Above
40,000,000

Tax
Rate

IncomeTax atEach Level(LAK)

Cumulative
Income Tax
(LAK)

0%

0

0

5%

100,000

100,000

10%

300,000

400,000

12%

720,000

1,120,000

15%

1,800,000

2,920,000

20%

3,200,000

6,120,00024%

Non-residents & compulsory profit withholding tax
Income source
Production activity (agricultural and industrial
products)
Commercial activity
Services:
1. Goods and passenger transportation
2. Construction and repairs
3. Exploitation and trading of trees, wood,minerals and other forest products
4. Tree plantation and exploitation
5. Black and red soil, sand and rockextraction, land filling activities
6. Entertainment activities
7. Legal, engineering, architecture and otherconsultancy activities
8. Brokers and agents
9. Development of lands and buildings for
sale
Other services

Grossprofitrates

Profit tax
deemed
rates

3%

0.72%

5%

1.2%

5%
10%
20%

1.2%
2.4%
4.8%

5%
15%

1.2%
3.6%

25%
10%

6%
2.4%

20%
20%

4.8%
4.8%

10%

2.4%

Other income taxes
Type of income

Rates

Dividends, interest, commissions
Sales of shares
Rental of real estate, vehicles, machinery, goods
Royalties from intellectual property
Transfer of land-use, building-use rights

10%2% or 10%10%5%2% or 10%

Page 3

Value added tax
Type of supply

Rates

Import of goods
Local production of goods and supply of services
Export of unprocessed natural resources
Export of goods
Export of processed natural resources

10%
0%

Excise tax

Type of goods

Fuel:-- Gasoline (super)-- Gasoline (normal)-- Diesel-- Jet fuel-- Lubricants, hydraulic oil, grease, andbrake oilCompressed natural gas for vehicles
Liquor or alcoholic drinks:-- Liquor or drinks with alcoholic content
of 20 percent and over-- Liquor, wine and other drinks withalcoholic content under 20 percent
Beer

Page 4Rates
for20162017

Rates
for20182019

35%
30%
20%
10%
5%

39%
34%
24%
14%
9%

Rates
for
2020
and
after

10%
30%

50%

70%

25%

45%

60%

50%

Type of goods

Ready-made drinks:-- Soft drinks, sodas, mineral water, fruit
juices and other similar drinks-- Stimulant drinks
Cigarettes:-- Cigars-- Cigarettes in packages-- Tobacco-- Others
Crystal items or crystal adornments
Carpets with a value of LAK1 million or more
Furniture sets (sofas) with a value of LAK10
million or more
Perfumes and cosmetics
Playing cards and gambling materials if
authorized by the relevant sectors
Traditional rockets, fireworks, firecrackers if
authorized by the relevant sectors

Rates
for
20162017

Rates
for20182019

Rates
for
2020
and
after

5%
10%
30%
30%
15%
30%

45%
45%
25%
45%
20%
15%

60%
60%
35%
60%

15%
20%
90%
80%

Page 5

Type of goods

Vehicles:1. Motorcycles:-- With engine volume of 110 cc and lower-- With engine volume of 111-150 cc-- With engine volume of 151-250 cc-- With engine volume of 251-500 cc-- With engine volume of 501 cc or more-- That use clean energy-- Motorbike spare parts
2. Transport vehicles:
2.1. Vehicles using fuel:-- With engine volume of 1,000 cc andlower-- With engine volume of 1,001-1,600 cc-- With engine volume of 1,601-2,000 cc-- With engine volume of 2,001-2,500 cc-- With engine volume of 2,501-3,000 cc-- With engine volume of 3,001-4,000 cc-- With engine volume of 4,001-5,000 cc-- With engine volume of 5,001 cc or more
2.2. Vehicles using clean energy
2.3. Small transport vehicles (2-door pick-ups,
trucks):-- using fuel-- using clean energy
2.4. Medium transport vehicles:-- using fuel-- using clean energy
2.5. Large transport vehicles:-- using fuel-- using clean energy
3. Vehicle spare parts

Page 6Rates
for20162017

Rates
for20182019

20%
30%
40%
60%
80%
5%
5%
25%
30%
35%
40%
45%
70%
80%
90%
10%
10%
5%
8%
5%
5%
3%
5%

Rates
for
2020
and
after

Ratesfor20162017

Type of goods

Accessories for vehicles
Speedboats, yachts, motorboats, including
their spare parts and accessories
Satellite television signal receivers,
audio-video players, cameras, telephones,
audio-video recorders, musical instruments,
including their components and accessories
Electrical appliances, including air
conditioners, washing machines, vacuum
cleaners
Billiard tables, snooker tables, bowling
equipment, football playing tables
All kinds of game players

Type of services
Entertainment: Nightclubs, discotheques,
karaoke
Bowling services
Beauty services
Use of services for mobile phones, digital
television, cable television, internet
Golfing services
Lottery services
Casino services, poker machines

Rates
for
20182019

Rates
for
2020
and
after

20%
20%

20%

20%
30%
35%

Rates
Rates Rates
forforfor 2020
2016- 2018and2017 2019
after
10%

20%

35%

10%
10%
10%
10%
25%
35%

Page 7Customs duty
Description
Import duty:
From ASEAN countries
From other countries
Export duty:
Standard rate
Specific rates for specific products

Page 8Rate
0 to 5% harmonized rates
Variable
0%5% to 40%

Contents
Quick Reference Tax Rate Tables............................................
Profit tax.................................................................................
Lump-sum tax.........................................................................
Employee income tax..............................................................
Non-residents & compulsory profit withholding tax...............
Other income taxes.................................................................
Value added tax......................................................................
Excise tax................................................................................
Customs duty..........................................................................

1
1
1
2
3
3
4
4
8

Contents................................................................................

9

Tax registration...................................................................... 11
Tax audits.............................................................................. 12
General tax audit process....................................................... 12
VAT audit process.................................................................... 12
Profit tax / Corporate income tax..........................................
Residency................................................................................
Rates.......................................................................................
Computation...........................................................................
Deductible expenses and other tax adjustments....................
Depreciation...........................................................................
Tax-loss utilization...................................................................
Filing and payments...............................................................
Profit tax of non-residents......................................................

14
14
14
14
14
16
17
17
17

Lump-sum Tax....................................................................... 18
Income Tax............................................................................
Overview.................................................................................
Scope......................................................................................
Rates.......................................................................................
Computation, filing and payment...........................................

19
19
19
20
21

Page 9

Value Added Tax....................................................................
Overview.................................................................................
Scope of application...............................................................
Non-taxable goods and services.............................................
Registration............................................................................
Rates of tax.............................................................................
Basics of taxation....................................................................

22
22
22
22
23
23
23

Excise Tax..............................................................................
Scope......................................................................................
Rates.......................................................................................
Basics of taxation....................................................................

25
25
25
25

Customs Duty........................................................................ 26
Import duty............................................................................. 26
Export duty............................................................................. 26
ASEAN and Double Taxation Agreements............................... 27
Transfer pricing...................................................................... 28
Investment Projects Incentives.............................................. 29
Administration......................................................................
Tax payment plan...................................................................
Accounting and invoicing........................................................
Complaints and refunds..........................................................
Tax due dates..........................................................................

30
30
30
30
31

Penalties............................................................................... 32

Page 10

Tax registration
Currently, there are two tax registration systems in Laos. Enterprises having
annual revenue of LAK400 million or more must be registered under thevalue added tax (“VAT”) system. Enterprises with annual revenue of lessthan LAK400 million may voluntarily be registered under the VAT systemor be subject to the lump-sum tax payment regime.
The determination of which tax system a new enterprise will be registeredunder is based on a number of factors, such as its business plan, the natureand expected size of the business activities, and its registered capital.

Page 11

Tax audits
General tax audit process
The Tax Authority can pursue, within three accounting years, the following
types of tax audits:
i. Regular audits: conducted according to official targets and plans.
ii. Audits with advance notice: unplanned but done at the taxpayer’s
premises when necessary.
iii. Urgent audits: conducted out of official plan at the taxpayer’s
premises and in emergency.
Taxpayer’s accounting documents are audited yearly by the Tax Authority
and the tax computations are checked accordingly.
Each audit is summarized in an audit memorandum, which is signed byboth the tax auditors and the taxpayer’s accountant or representative.
If the taxpayer disagrees with the audit conclusion, an appeal can be filed
within 30 days to the immediate next higher level of the Tax Authority.
If the taxpayer is not satisfied with the Tax Authority’s final decision, an
appeal can be filed with a court for judicial decision.
VAT audit process
Lao taxpayers may be subject to VAT tax audits at the discretion of the Tax
Authority. They may be conducted for up to three years after the initial
filing of VAT.
There are three kinds of tax audits:
i. Desk audit: This is conducted at the Tax Authority’s office.
ii. Field audit: This is conducted at the taxpayer’s office.
iii. Inspection at relevant sites: This is conducted at locations where
stock is held within the country.
Audits are intended to be conducted on a regular basis with prior noticeand ends with a memorandum signed by both parties.
Page 12

Taxpayers have 30 days from receipt of an assessment notice to file anappeal with the Tax Authority.
The claim will be considered and settled within 30 working days
(extendable for up to 60 days) under a settlement agreement.
If there is still disagreement, the taxpayer is entitled to elevate its claim
to the immediate next higher level of the Tax Authority within 20 working
days for a final decision.
If the taxpayer remains unsatisfied with the Tax Authority’s final decision,
it can bring an action in accordance with the Law on the Handling ofPetitions.

Page 13

Profit tax / Corporate income tax
Residency
Lao taxpayers are all individuals, legal entities and organizations, including
Lao citizens, aliens, foreigners and stateless persons, who operatebusinesses or make a living in Laos on a permanent or temporary basis,including persons residing or having a business in Laos but carrying out
their business abroad, who are obligated to pay taxes to the State asprovided in the laws and regulations.
Rates
A standard 24% rate applies to domestic and foreign companies thathave legal entity status. A special 26% rate applies to tobacco companies.
Progressive rates of from 0% to 24% apply to freelancer and sole-trader
enterprises.
Computation
The annual accounting profit is both, in the balance sheet, the difference
between total assets and total liabilities, and in the income statement, thedifference between total business income and total business expenditures.
Profit tax is computed by applying the tax rate to the taxable basis, whichis the accounting profit increased by any non-deductible expenses andreduced by any legally authorized deductions.
Deductible expenses and other tax adjustments
As a general rule, expenses are deductible if paid or incurred during thetax year, expended for business purposes, for a “reasonable” amount,
invoiced and legally documented.

Page 14

Expense/income•

Profit tax•

Input VAT relating to fixed asset purchases,
which is deducted on a monthly basis
against output VAT•

Deferred tax expenses and penalties•

Fixed asset accounting depreciation•

Accounting provisions•

Provisions for the impairment of assets•

Unrealized foreign exchange losses•

Salaries paid by a partnership company
to its partners who are not part of the
management or the workforce•

Loan interest derived from partners andoutside the banking system•

Interest on loans not used for the business•Entertainment, golfing and otherexpenses unrelated to the business••

Donations stipulated in an MOU with thegovernment
Travel for administrative purposes•

Reception and communication expenses•

Donations•
Advertising costs
Fixed asset tax depreciation
Dividends received and already taxed
Provisions recovered and already taxed

Tax adjustment

Non-deductible
expense

Deductible expense
up to 0.3% to 0.6% ofannual turnoverDeductible expense
Non-taxable income
Non-taxable income

Page 15

Expense/income

Tax adjustment

Bad debts (previously taxed) with supporting
Non-taxable income
evidence
Income from deferred tax
Non-taxable income
Unrealized foreign exchange gains
Non-taxable income
Depreciation
Lao law recognizes three depreciation methods: straight-line, doubledeclining and unit of production.
However, the Amended Tax Law 2015 only specifies the straight-line
method according to the following rates:

Asset

Tax
depreciation
rate

Intangible fixed assets•
Company establishment costs•
Mining exploration and research costs•
SoftwareTangible fixed assets

50%
20%
50%

•

5%

•
•
•
•
•
•
•

Industrial buildings with a useful life of 20 years
or less
Industrial buildings with a useful life of more than
20 years
Permanent commercial and residential buildings
Semi-permanent commercial and residentialbuildings
Machinery, vehicles, equipment
Material and office supplies
Ships and boats
Passenger and cargo planes

Page 16

2%
5%
10%
20%
20%
10%
Flight hours

Tax-loss utilization
Business operators are entitled to carry forward their tax losses for threeconsecutive tax years. The tax losses must have been certified by both theTax Authority and an independent audit firm.
Filing and payments
The tax year-end is normally 31 December. Companies must file theirfinancial report with other supporting documents by 1 March of thefollowing year.
Profit tax is payable in advance on a quarterly basis, and the amount isbased on either the previous year’s tax payment, the current quarter’s
profit or the estimated profit tax according to the company’s businessplan. Each payment must be made by the 10th of the month following
each quarter period-end.
The actual tax amount is computed in the annual tax return based on acompany’s final results. Any additional amount due must be paid upon
submission of the annual return and financial report. If a company has
made excess payments, the company will have a tax credit, which is thencarried forward to the following year.
Profit tax of non-residents
Lao companies must withhold profit tax from payments made to theirforeign providers for services performed in Laos and remit the amountto the Tax Authority within 10 days. The profit tax to be withheld is doneusing the deemed rate mechanism (details of rates at the beginning of
this booklet).

Page 17

Lump-sum Tax
Business operators that are not registered under VAT have to pay alump-sum tax on their annual turnover. The applicable tax rate will varydepending on the industry and level of turnover.
Annual turnover(LAK)
Less than 12,000,000
12,000,001–
50,000,000
50,000,001–
120,000,000
120,000,001–
240,000,000
240,000,001–
400,000,000

Lump-Sum tax rates
Manufacturing

TradingServices

ExemptFixed amount – but not to exceed LAK600,000
per annum
3%

4%

5%

4%

5%

6%

5%

6%

7%

The lump-sum tax is payable on a monthly, quarterly, semi-annual or
annual basis, as agreed with the Tax Authority.

Page 18

Income Tax
Overview
Income tax applies to any income generated in Laos regardless of thebeneficiary’s nationality or tax residency, except where a double taxationagreement (“DTA”) applies.
Scope
Main types of incomeTaxtreatment

Employment income
Salaries, wages, overtime, bonuses, allowances ofexecutives directors and boards of directors, cash or
in-kind benefits

TaxableSalaries of LAK1,000,000 or less

ExemptSalaries of foreign diplomats, and staff and experts ofinternational organizations

ExemptFinancial income•

Dividends

Taxable•Sales of shares

Taxable•Loan interest, commissions, guarantee fees

Taxable•Profit derived from shares sales on Stock Exchange

Exempt•Dividends distributed to partners or shareholders
of a company registered on the Stock Exchange

Exempt•Income from bonds issued by listed companies

Exempt•Interest on deposits and Government bonds

Exempt•Premiums for life and property insurance

ExemptPage 19

Tax
treatment

Main types of income
Income from real estate and intellectual property rights•

Real estate rental income, revenue from movable
assets, royalties and other income derived from
intellectual property

Taxable•Sales price of real estate rights transfer

Taxable•Rent from the assets of a business operator

Exempt•Income from the transfer of real estate rights
recorded in the balance sheet of a business
operator

Exempt•Inheritance from a vertical line relative

ExemptRates
Employment income is taxed at the following progressive rates:
Level

1
2
3
4

Page 20

TaxableSalaryat EachLevel(LAK)
1,000,000
and below
1,000,001 –3,000,000
3,000,001 –6,000,000
6,000,001 –12,000,000

Basis ofCalculation
(LAK)

Tax
Rate

IncomeTax at
Each
Level
(LAK)

Cumulative
Income Tax(LAK)1,000,000

0%

0

0

2,000,000

5%100,000

100,000

3,000,000

10%

300,000

400,000

6,000,000

12%

720,000

1,120,000

Level5
6
7

TaxableSalaryat EachLevel(LAK)
12,000,001 –24,000,000
24,000,001 –40,000,000
Above
40,000,000

Basis ofCalculation
(LAK)

Tax
Rate

IncomeTax at
Each
Level
(LAK)

Cumulative
Income Tax(LAK)12,000,000

15%1,800,000

2,920,000

16,000,000

20%

3,200,000

6,120,000

24%

Other types of income are subject to flat rates as follows:
Type of income
Dividends, interest, commissions
Sales of shares
Rental of real estate, vehicles, machinery, goods
Royalties from intellectual property
Transfer of land, building use rights

Rates
10%
2% or 10%10%5%2% or 10%

Computation, filing and payment
Income tax from salaries must be calculated and withheld from salary
payments by employers on a monthly basis. The tax must be remitted to
the Tax Authority before the 15th of the following month.
For real estate rentals or transactions, the tax is calculated based on thelease agreement and areas standard prices defined in specific regulations.
The beneficiary must declare the tax due to the Tax Authority within 10
days from the date of receiving the rental payment.
Income tax other than from the types of income mentioned above must
be calculated and paid within 10 days from the date payment is made.
Depending on the case, either the payer or the beneficiary will be
responsible for paying the tax.
Page 21

Value Added Tax
Overview
VAT is an indirect tax that is collected on the consumption of goods andservices within Laos. Individuals, legal entities and organizations that areoperating businesses in Laos are responsible for collecting VAT from theconsumers of their goods and services. They are entitled to deduct the
input VAT they paid on purchases of goods and services directly used intheir business.
Scope of application
Taxable supplies of goods and services cover the importation of goods,
and supplies within Laos, including the services of non-residents, legal
entities and organizations unincorporated in Laos. Disbursements to
non-residents and organizations unincorporated in Laos must be by theapplicable VAT and paid by the Lao client.
Non-taxable goods and services
The Lao VAT Law includes most common exemptions (importation ofstamps, aircraft, goods for the official work of embassies and internationalorganizations, medical services and equipment). Specific exemptions
mostly relate to key public priorities:•

Agriculture: Importation or sale of non-processed products andanimals, seeds, fertilizers, equipment•

Education: Importation and sale of textbooks, teaching manuals andmaterials, modern learning materials, educational services•

Finance: Insurance business of health, life, animals and forests,
deposit interest, and loan interest from transactions of authorizedcommercial banks or financial institutions

If a business only makes exempted supplies, it will not be able to claim any
input VAT. If a business makes a mix of non-taxable and taxable supplies,
input VAT will be deductible only up to the proportion that is liable for VAT.

Page 22

Registration
Compulsory VAT registration applies to businesses whose annual turnoverequals or exceeds LAK400 million (US$47,000).
Rates of tax
Taxable supplies made in or imported into Laos are subject to VAT at oneof two rates:
Type of supply

Rate

Import of goods
Local production of goods and supply of services

10%

Export of unprocessed natural resources
Export of goods
Export of processed natural resources(Specific regulation) Imported of raw materials,
chemical substances, equipment, production
machinery and devices that cannot be domestically or
sufficiently made for use in production and investment
in fixed assets0%

Zero-rated supplies are not the same as non-taxable supplies, as it ispossible for entities providing zero-rated supplies to claim input VAT credit.
Basics of taxation
For the supply of goods and services, VAT is payable monthly, and returns
must be filed before the 15th of the following month. For imports, the VAT
return must be submitted at the same time as the customs return and the
VAT due is paid at the time of customs clearance.
An invoice report schedule must also be submitted for every quarter notlater than the 15th of the month following the quarter-end.
VAT refunds are limited to export businesses, businesses that merge, split,
dissolve or go bankrupt, tourists, embassies, international organizations,and any other individual or entity who did a VAT overpayment.
Page 23

A VAT refund request can be made each month, but cannot be made later
than six months from the date the refundable VAT occurred.
If a refund is not requested, the VAT credit can be carried forward to thefollowing tax period.

Page 24

Excise Tax
Scope
Excise tax is another indirect tax, but with a more restricted scope than
VAT and a number of different rates. Supplies or imports of specific goods,
as well as supplies of specific services, are subject to excise tax unlessexpressly exempted.
Rates
Please refer to the excise tax quick reference table at the beginning of thisbooklet.
Basics of taxation
Excise tax is an ad-valorem tax, i.e. it applies to either the CIF value
increased by the customs duty in the case of imports, or the commercial
value of the taxable supply.
Excise tax must be declared and paid at the time of import in conjunction
with the customs duty, or monthly before the 15th of the month following
the supply.
Excise tax on cars applies to the sales price of the car regardless of whether
it is imported or produced in Laos. It has to be paid by the customer
directly to the Tax Authority.

Page 25

Customs Duty
Import duty
There are a number of goods on which import duty applies, with some
exceptions, including goods temporarily imported into Laos, personal
belongings, goods transported because of relocation, and essential items
used for education, health, scientific study and religious purposes.
Exemptions or reduced duty might be available for exports and imports
done under the Investment Promotion or the Special/Specific Economic
Zones policies.
Customs duty is levied on goods entering Laos at variable rates.
Laos is part of ASEAN and therefore party to the ASEAN Free Trade
Agreement and Common Effective Preferential Tariff scheme. Accordingly,
Lao customs duty rates have been reduced so that many goods comingfrom another ASEAN country have a maximum 5% import duty imposed.
Export duty
There is no export duty other than on a limited list of restricted products
at rates of 5% to 40%.

Page 26

ASEAN and Double Taxation Agreements
The aim of the ASEAN Economic Community (“AEC”) is to provide regional
economic integration by creating a single market across ASEAN countries,
similar to the European Union. The purpose of this is to stimulate
economic growth in all participating countries by allowing a free flow ofhuman resources, goods, services and investment between countries.
From a tax perspective, the AEC is working towards establishing DTAs
among ASEAN countries and removing withholding taxes that may locally
apply on interest, royalty, dividend and service fee payments.
Laos currently implements DTAs signed with Brunei, China, South Korea,
Luxembourg, Malaysia, Myanmar, Thailand and Vietnam.
Laos also has DTAs that have been negotiated, but are not yet in force orenforced at the time of writing, with Indonesia, Kuwait and Russia.

Page 27

Transfer pricing
There are currently no formal transfer pricing regulations in Laos.
The current practice of some tax auditors is to use point 12 of Article 34of the Amended Tax Law 2015 to reject any expense that is “higher thanreality”.
Intragroup loans are also restricted under the regulation with point 8of the same article, which forbids the tax deduction of interest paid topartners.
The “arm’s length” principle is the standard universally adopted ininternational tax law: it should be followed by Lao taxpayers for all expense
transactions, whether with third or related parties.
Invoicing is required for any transaction (point 12 of Article 34 of theAmended Tax Law 2015), and contractual documents, such as bills, must
be kept for 10 years.
If the taxpayer is part of a group that has a transfer pricing group policy,
this documentation should also be maintained, even if not required bylaw, to explain and provide supporting evidence for the pricing used intransactions between the Lao entity and its related parties.

Page 28

Investment Projects Incentives
The promoted sectors under Lao investment regulations are agriculture,industry, handicraft and services, categorized into three different levels
and three different prioritized zones.
The customs duty and tax incentives provided in the investment
regulations are as follows:•

Profit tax exemption for a certain number of years depending on thezone and level of the investment (see table below), starting from thefirst commercial operational date.

•

Profit tax exemption in the accounting year following thereinvestment of the net profit into the business for expansion.

•

Exemption from import duty on the importation of raw materials,
equipment, spare parts and vehicles.

•

Exemption from export duty on the exportation of general goods andproducts.

•

Tax losses can be carried forward for three consecutive accounting
years.
Zone
1

2

3

Level

Profit tax exemption period

1
2
3
1
2
3
1
2
3

10 years
6 years
4 years
8 years
4 years
2 years
4 years
2 years
1 years

Page 29

Administration
Tax payment plan
Lao taxpayers are required by law to prepare a tax payment plan each year
for each type of tax they are liable for and submit it to the Tax Authority.
Accounting and invoicing
Accounting systems must comply with the local GAAP (Lao accounting
standards) and supporting documents must be kept available for 10 years.
IFRS will become applicable by law in Laos starting 1 January 2017.
For every service or supply, taxpayers must issue invoices that meet theLao requirements and conform to the specific and general formats issued
by the Ministry of Finance.
Complaints and refunds
Taxpayers who want to amend their tax return and correct their tax
payment must file a request within 30 days from the date of the said tax
payment.
The Tax Authority has to answer the complaint within 30 days of receipt of
the request: it shall, if possible, refund the taxpayer and, if not, allow theoffset of such amount on the following period’s tax liability.
If the taxpayer does not receive a response, or the request is rejected by
the Tax Authority, the taxpayer has the right to appeal to the immediatenext higher level or to initiate court proceedings.

Page 30

Tax due dates
Type of tax

Due date

Profit tax:
Submission of the financial report 1 March (of the next year)
30 March (of the next year)
Submission of the profit tax
return10 AprilPayment of the 1st installment
10 July
Payment of the 2nd installment
10 October
Payment of the 3rd installment
Payment of the 4th installment
10 January (of the next year)
Filing and payment of withholding Within 10 days of service fee
tax on non-resident service fees
payment
Income tax (return filing and tax
payment):
Employee salaries - monthly
15th of the next month
Payment within 10 days from
Rentals, Dividends, interests,
the date of payment
royalties
Value added tax:
Filing of return and payment of
15th of the next monthtax
15th of the next month
Invoice report scheduleExcise tax:
Imports
At customs clearance
Sale of local production
15th of the next month
Customs duty:
Imports
At customs clearance
Exports
At customs clearance

Page 31

Penalties
The following penalties apply depending on the tax and the violation.
Violation
Delay in submitting return and tax
payment:(General) Late filing and payment(VAT) Late filing and payment(VAT) Late submission of a nil return
Incomplete declaration and tax payment:(General) Underreporting or payment(General) Failure to invoice or false
invoices issued
Inaccuracy of VAT return
Incomplete VAT payment
Incorrect input VAT deduction
Failure to register, report and pay:
(General) Bookkeeping failure(General) Failure to declare revenue
Failure to submit VAT return
Failure to pay VAT(General) Failure to answer to the Tax
Authority

Page 32

Penalty rate or
amount0.1% of tax due per day
0.1% of tax due per day
LAK500,000
20% to 60%
20% to 60%
50%
50%
50%
30% to 100%30% to 100%
LAK1,500,000
30% to 100%30% to 100%

Partners

Jean Loi

Jean is one of the region’s most experienced tax and regulatory
specialists with more than 12 years of experience in Indochina,
Myanmar and Singapore. She has advised on a large number ofproject transactions and tax disputes in the specialty areas ofstructuring, power plant projects and oil and gas. As the managing
partner of VDB Loi, Jean has extensive experience with the projects
related to the market entries of companies in the infrastructure,telecommunications and financial services industries in the region,
as well as with supply chains. In Laos, she works with clients froma variety of Industry sectors, conducting due diligence and advisingon investments and M&A projects.
She has been recognized for her outstanding practice with anumber of awards. Jean is accredited for Income Tax and GST
Advisory by the Singapore Institute of Accredited Tax Professionals(SIATP) and is a member of the Chartered Accountants of Australia
and New Zealand.

Edwin was formerly with Loyens & Loeff and a partner at DFDL.
He has 21 years of experience as a legal advisor, academic, author
and government consultant. He has worked in Southeast Asia for
16 years.
Edwin
Vanderbruggen

Edwin has structured some of the largest acquisitions andinvestments in the region, and is a renowned tax specialist. In
Laos, Edwin has assisted clients with tax disputes and advising on
the legal and tax implications of their operations. He has worked
on transactions and compliance issues in Laos since 2008. Headvised on the purchase of one of the largest telecom operatorsin the country, on the acquisition of an oil and gas interestby an exploration company based in the UK, and has advised
development financial institution on financing transactions with
Lao borrowers and sovereigns.

Page 33

Legal and Regulatory Team
Daodeuane is regarded as one of Laos’ most experienced andknowledgeable advisors. She has over 14 years of experience,
including leading the tax team at PwC in Laos, and prior to that,working at a top regional law firm.
Daodeuane
Duangdara

Sornpheth
Douangdy

Lucas Vosh

Meckhala
Vilivong

Pout Aloun
VongpranakhoneAnonglack
Phongsavanh

Page 34

Daodeuane advises multinational and local firms in Laos acrossa wide range of sectors including mining, hydropower, gas
exploration, and banking, and has formed excellent working
relationships with the government authorities.
Previously an associate director managing PwC Lao’s legal
practice, Sompheth is an attorney-at-law with an impressive legal
background, having been a district court judge, a legal researcher,and a law lecturer in Laos. He was part of the working group that
prepared the civil law textbook, and amended the contract, tort
and economic arbitration organization laws, and is an expert in anticorruption. At VDB Loi, Sornpheth provides legal advisory to clientsfrom a broad range of industry sectors on their Lao law matters.
Lucas is an Australian qualified lawyer with over 12 years ofexperience. His practice areas include real estate and construction,
corporate, commercial and banking and finance. He has
considerable experience acting for international and local clients
across the property development, agriculture, manufacturing, andmining sectors.
Meckhala, a member of the Lao Bar Association, is an experienced
legal advisor, and worked for five years with PwC Laos in the legal
and tax services division. She has assisted a wide range of local
and international clients with their corporate and legal issues, on
matters such as investments, labor issues, market entry, company
setup and legal due diligence.
Pout studied in Moscow and received a Bachelor of Arts degreein Law from the People’s Friendship University of Russia, Prior tojoining VDB Loi, he was an intern at the People’s Supreme Court inVientiane. Pout supports clients from a variety of industries with
their market entry, corporate registration, licensing, and labor andimmigration issues. He speaks Laotian, Russian and English.
Anonglack, an experienced legal advisor, worked as a seniorconsultant for PwC Laos in its legal and tax services division before
joining VDB Loi. He assists a wide range of local and international
clients with their corporate and legal issues, including on
investment, labor, immigration, company establishment and legal
due diligence.

Tax and Compliance Team

Anthony
AssassaInthakesy
Sithimolada

Jenny Ng

Anthony is a French expert in taxation with varied international
experience. He spent several years in tax consulting with Big Four
firms Ernst & Young and PwC in emerging markets. A consultant
for the Cameroon and Comoros tax and customs authorities, heunderstands customs duty and cross-border taxation from both
the government’s and the client’s perspectives. Anthony advises
clients across a range of industries, and has particular expertisewith regard to the energy sector, advising and clients’ power andresources projects.
Inthakesy (known as Lada) comes to VDB Loi from the commercial
sector where she most recently held executive assistant positionsin the hospitality industry, Educated in the fields of accounting
and hospitality management in the USA and Australia, she also
has financial experience through her work within the international
NGO sector.
Jenny, an ACCA-certified accountant, brings over 10 years offinance experience to VDB Loi, She worked for several years with
Ernst & Young as an auditor, assisting clients across a broad range
of industry sectors. She has since held management positions forseveral large conglomerates in the garment sector, as well as having
run her own business. At VDB Loi, she assists clients with theiraccounting and tax compliance matters.
Phompasit is a tax advisor for our office in Laos. Before joining VDB
Loi, he worked as a tax and legal consultant for PwC Laos. At VDB
Loi, Phompasit assists clients from a range of industry sectors with
their tax compliance needs.

Phompasit
Sadettan

Page 35

Offices in Lao and throughout the region
Laos
Contact:

Level 4 Alounmai Tower

Daodeuane Duangdara | Director

23 Singha Road

Daodeuane.Duangdara@vdb-loi.com

Saysettha District, Vientiane

T: +85 62 145 4679

T: +856 21 45 4 679

Cambodia

MyanmarLevel 6 Phnom Penh Tower

Level 8 Centrepoint Towers

445 Monivong Boulevard

No. 65 Sule Pagoda Road

Phnom Penh

& Merchant Street

T: +855 23 964 430

Kyauktada Township, Yangon
T: +95 137 1902

Indonesia
Plaza Bisnis Kemang
Suite 211
Jl. Kemang Raya No. 2
Jakarta 12730

No. S-204, Tha Pyay Kone Ward
Zabu Thiri TownshipNay Pyi Taw
T: +95 678 108 0941

T: +62 21 718 3415

Vietnam

The Cityloft Sudirman Suite 1119

Level 20, Unit 4, Bitexco Financial Tower,

Jalan K. H. Mas Mansyur Kav. 121

2 Hai Trieu Street

Jakarta, 10220

District 1, Ho Chi Minh City

T: +62 21 2555 6611

T: +84 8 3914 7272

Liaison Offices
Japan

Singapore

Shinbuya Mark City West 22F

16 Collyer Quay

1-12-1, Dogenzaka, Shibuya-ku#21-00 Hitachi Tower

Tokyo 150-0043

Singapore, 049318

T: +81 3 4360 5758

T: +65 9680 3971

Page 36Myanmar

Laos

Get to the point.
Cambodia
VietnamSingapore

Indonesia

VDB Loi is a network of leading law and advisory member
firms and affiliated companies that comprises 11 partners
and over 100 lawyers and advisors, with offices in Cambodia,
Indonesia, Laos, Myanmar and Vietnam, and representatives inJapan and Singapore. We provide the highest quality solutions
for transactions and taxation. With our fast-growing team offoreign and local professional advisors, we are a leading firmin Laos.