Overview

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M&A Tax Due Diligence is a critical component of any merger or acquisition transaction. It enables investors, buyers, and strategic partners to identify historical tax exposures, assess compliance risks, evaluate tax efficiency, and quantify potential liabilities prior to closing.

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At W&A Consulting, we conduct comprehensive, risk-focused, and transaction-driven tax due diligence reviews tailored to the nature of the target, industry, deal structure, and investor profile.

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Our objective is not merely to detect issues, but to translate tax findings into commercial insight that supports negotiation, pricing adjustment, warranty protection, and post-deal structuring.

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​Scope of Services

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​Our M&A Tax Due Diligence typically covers the following areas:

​1. Corporate Income Tax (CIT) Review

• Review of historical CIT filings and tax finalizations

• Assessment of revenue recognition and deductible expenses

• Evaluation of tax incentives, preferential rates, and eligibility conditions

• Analysis of tax losses carried forward and their recoverability

• Review of related-party transactions and transfer pricing compliance

• Identification of potential permanent establishment exposure (if cross-border elements exist)

We assess whether the target’s tax position is sustainable and defensible under tax audit scrutiny.

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2. Value Added Tax (VAT) and Indirect Tax Review

• Review of VAT declarations and reconciliation with accounting records

• Assessment of input VAT deductibility conditions

• Analysis of VAT refund positions and outstanding claims

• Evaluation of export transactions and zero-rate eligibility

• Review of customs valuation and import/export tax compliance

This area is particularly critical for manufacturing, trading, and FDI enterprises where VAT refund exposure can materially impact valuation.

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3. Personal Income Tax (PIT) and Payroll Tax Review

• Review of payroll structure and taxable benefit treatment

• Assessment of expatriate tax compliance and residency status

• Review of withholding obligations and tax finalization filings

• Identification of risks relating to consultants or disguised employment arrangements

We evaluate hidden payroll exposures that often surface during tax audits post-acquisition.

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4. Foreign Contractor Tax (FCT) and Cross-Border Taxation

• Review of payments to foreign suppliers and service providers

• Assessment of FCT withholding compliance

• Analysis of double tax treaty application

• Identification of potential permanent establishment risk

This is especially relevant for targets with offshore service contracts, technology licensing, or intercompany service agreements.

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5. Tax Contingencies and Open Tax Audit Risks

• Review of past tax inspection reports and unresolved matters

• Assessment of tax authority correspondence

• Evaluation of statute of limitations exposure

• Quantification of contingent liabilities

We classify risks by probability and financial impact, providing clear estimates for pricing adjustments or indemnity negotiation.

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6. Transaction Structure and Exit Planning Considerations

​Beyond historical review, we advise on:

• Tax implications of share deal versus asset deal

• Capital gains tax exposure

• Withholding tax implications for foreign sellers

• Structuring options to optimize post-acquisition tax efficiency

• Debt push-down and financing considerations

We align tax strategy with the investor’s commercial objectives.

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Our Methodology

​W&A applies a structured and pragmatic approach:

1. Initial risk assessment based on industry and deal structure

2. Data request list tailored to the target’s business model

3. Financial and tax reconciliation review

4. Technical tax analysis and risk quantification

5. Executive summary highlighting key deal drivers

6. Recommendations for SPA protection, price adjustment, or restructuring

Our reports are concise, commercially focused, and suitable for sharing with legal counsel, financial advisors, and investment committees.

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Deliverables

• Detailed Tax Due Diligence Report

• Executive Risk Summary (Red Flag Report, if required)

• Quantified Tax Exposure Matrix

• SPA Tax Clause Recommendations

• Post-Deal Tax Remediation Plan

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Why W&A

• Led by former Big Four Tax Director and experienced transaction advisors

• Deep understanding of Vietnamese tax practice and tax authority approach

• Integrated legal and tax perspective

• Strong experience advising foreign investors and cross-border transactions

• Practical negotiation support during deal execution

We do not simply report risks. We support you in converting tax findings into negotiation leverage and structured protection.

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When Should You Engage Us?

• Before signing an SPA or term sheet

• During exclusivity period

• When considering restructuring prior to sale

• In vendor due diligence scenarios

In pre-IPO tax readiness review