New regulations on depreciation and amortization of fixed assets at state agencies

Fixed asset depreciation is calculated once a year in December.

Type 1: Houses and construction works; including: Office buildings; warehouses; halls; club houses; cultural houses; sports training and competition houses; conservation houses and museums; nurseries; kindergartens; workshops; classrooms; lecture halls; dormitories; clinics and treatment rooms; nursing homes; guesthouses; official residences and other houses and construction works.

Type 2: Architectural structures; including: Warehouses, tanks, parking lots, drying yards, playgrounds, sports fields, swimming pools, drilled wells, dug wells, fences and other architectural structures.

Type 3: Cars; including: Cars serving official positions, cars serving general work, specialized cars, cars serving state receptions and other cars.

Type 4: Other means of transport (other than automobiles); including: Road transport, railway transport, water transport, air transport and other means of transport.

Type 5: Machinery and equipment; including: Common office machinery and equipment; machinery and equipment serving general operations of agencies, organizations and units; specialized machinery and equipment and other machinery and equipment.

Category 6: Perennial plants, working and/or product animals.

Type 7: Other tangible fixed assets.

Intangible fixed assets are assets without physical form that agencies, organizations, units, and enterprises have invested in creating assets or are formed through the process of operation; including:

Type 1: Land use rights.

Type 2: Copyright and rights related to copyright.

Type 3: Industrial property rights.

Type 4: Rights to plant varieties.

Type 5: Application software.

Type 6: Brand of public service unit.

CalculateFixed asset depreciation is performed once a year in December.

The Circular clearly states that depreciation of fixed assets is calculated once a year in December, before closing the accounting books.

For fixed assets that an agency, organization, unit or enterprise receives from another agency, organization, unit or enterprise according to the decision of a competent authority or person in a year, the depreciation calculation in that year shall be performed at the agency, organization, unit or enterprise receiving the assets.

The annual depreciation of each fixed asset (except where otherwise specified) is determined by the following formula:

In which, the depreciation rate is determined according to the provisions in Appendix No. 01 issued with this Circular, the provisions of the Minister, Head of central agency, Provincial People's Committee according to the provisions in Point a, Clause 1, Clause 2, Article 13 of this Circular.

Depreciation period and depreciation rate of tangible fixed assets

This Circular takes effect from June 10, 2023 and is applied from fiscal year 2023.