Regulations on tax payment under Viet Nam Law on Tax Administration

Tax payment is very important in contributing to the State budget. Let’s find out this issue with Lawyer X through the following situation: “Dear Lawyer! I want to ask when are tax payment deadlines? How shall taxpayers pay tax? What are other legal regulations on tax payment in Viet Nam? Thanks for answering me!”

Legal grounds

• Viet Nam Law on Tax Administration

Regulations on tax payment deadlines

– In case tax is calculated by the taxpayer, the tax payment deadline is the deadline for submission of the tax declaration dossier. In case of submission of supplementary tax documents, the tax payment deadline is the deadline for submission of the erroneous tax declaration dossier.

The deadline for paying corporate income tax, which is paid quarterly, is the 30^th of the first month of the next quarter.

The deadline for paying resource royalty and corporate income tax on crude oil is 35 days from the date of selling domestically or the date of customs clearance in case of export.

Resource royalty and corporate income tax on natural gas shall be paid monthly.

– In case tax is calculated by the tax authority, the tax payment deadline shall be specified in the tax authority’s notice.

– The deadlines for paying other amounts payable to state budget from land, grant of the right to water resource extraction or mineral extraction, registration fees and licensing fees shall be specified by the Government.

– For taxable exports and imports, deadlines for tax payment are specified in the Law on Export and import duties. In case tax is incurred after customs clearance or conditional customs clearance:

• The deadline for submission of supplementary documents and fulfillment of the imposed tax liability is the same as that on the initial customs declaration;
• The Minister of Finance shall specify deadlines for paying tax on goods that need to under analysis to determine tax payable, goods without official prices when the customs declaration is registered; goods for which the payment; goods for which payments and added amounts to the customs value are unknown when the customs declaration is registered.

Regulations on receiving authorities

– Taxpayers shall pay tax:

• At State Treasuries;
• At the tax authorities that receive the tax declaration dossiers;
• Via a organization authorized by the tax authority to collect tax; or
• Via a commercial bank or credit institution or service provider as prescribed by law.

– State Treasuries, commercial banks, credit institutions and service providers shall prepare their premises, equipment and personnel to collect tax.

– Every organization that collects or deduct tax shall provide tax payment documents to taxpayers.

– Within 08 working hours from the tax collection, the collecting organization shall transfer the collected tax to state budget. The Minister of Finance shall specify the time limit for transfer of tax collected in cash in remote and isolated areas, islands, areas where travel is difficult or collection time is limited.

Order for payment of tax, late payment interest and fines

– Tax, late payment interest and fines shall be paid in chronological order and in the order specified in Clause 2 of Article 57

– Order for payment of tax, late payment interest and fines:

• Overdue tax, fines and late payment interest subject to enforcement;
• Overdue tax, fines and late payment interest that are yet to subject to enforcement;
• Recently incurred tax, late payment interest and fines.

Determination of tax payment date

– In case of non-cash payment of tax, the tax payment date is the date on which the State Treasury, commercial bank, credit institution or service provider extracts the tax from the taxpayer’s account or the authorized person’s account and written on the tax payment document.

– In case of payment of tax in cash, the tax payment date is the date on which the State Treasury, tax authority or authorized collecting organization issues the tax payment document.

Handling of late tax payment

– Late payment interest shall be charged in the following cases:

• The taxpayer pays tax behind deadline, the extended deadline, the deadline written in the tax authority’s notice, tax liability imposition decision or handling decision;
• If the supplementation of the tax declaration dossier leads to an increase in the amount of tax payable, or the tax authority or inspecting authority finds that tax is understated, late payment interest shall be charged on the increase in tax over the period from the day succeeding the initial deadline or the deadline for tax payment of the initial customs declaration;
• If the supplementation of the tax declaration dossier leads to a decrease in the amount of refundable tax, or the tax authority or inspecting authority finds that refundable tax is smaller than the refunded tax, late payment interest shall be charged on the excessively refunded tax, which has to be paid back to state budget, over the period from the day on which tax is refunded;
• The cases in which outstanding debt may be paid by installments as prescribed in Clause 5 Article 124 of Law on Tax Administration;
• The cases in which administrative penalties are not imposed due to expiration of the time limit for penalty imposition but outstanding tax has to be collected as prescribed in Clause 3 Article 137 of Law on Tax Administration;
• The cases in which administrative penalties are not imposed specified in Clause 3 and Clause 4 Article 142 of Law on Tax Administration;
• The organization that is authorized by the tax authority to collect tax but fails to transfer the tax, late payment interest and fines paid by taxpayers to state budget in a timely manner shall pay an interest on such amount.

– Calculation of late payment interest:

• The rate of late payment interest is 0,03% per day on the overdue amount;
• The period over which late payment interest is charged is a continuous period from the day succeeding the day on which late payment interest is charged as specified in Clause 1 of Article 59 to the day preceding the date of payment of the outstanding tax, refunded tax, increase in tax, imposed tax.

– Taxpayers shall calculate the late payment interest themselves in accordance with Clause 1 and Clause 2 of Article 59 and pay it to state budget as prescribed. Overpaid tax, late payment interest and fines shall be handled in accordance with Clause 1 Article 60 of Law on Tax Administration.

– In case the taxpayer fails to pay tax, late payment interest and fines within 30 days from the deadline for making such payment, the tax authority shall inform the taxpayer of the amount payable and the number of days behind schedule.

– Late payment interest shall not be charged in the following cases:

• The taxpayer provides goods/services which are covered by state budget, including sub-contractors in the contract with the investor, and are directly paid for by the investor. If such goods/services are not yet to be paid for, late payment interest will not be charged. The outstanding tax exempt from late payment interest is the tax on the amount that is yet to be paid by state budget;
• In the cases specified in Point b Clause 4 Article 55 of Law on Tax Administration, late payment interest shall not be charged pending the analysis result, official price, actual payment or additional customs value.

– Late payment interest shall not be charged in case of chargeoff specified in Article 83 of Law on Tax Administration.

– If the supplementation of the tax declaration dossier leads to a decrease the tax payable or the tax authority discovers a decrease in the tax payable, the late payment interest may be adjusted accordingly.

– Taxpayers may be exempt from paying the late payment interest specified in Clause 1 of Article 59 in the force majeure events specified in Clause 27 Article 3 of Law on Tax Administration.

– The Minister of Finance shall provide for handling of late tax payment.

Handling of overpaid tax, late payment interest and fines

– If the tax, late payment interest or fine paid by a taxpayer is greater than the amount payable, the overpaid amount may be offset against the outstanding tax, late payment interest or fine, or against the tax, late payment interest or fine payable next time, or may be refunded if the taxpayer no longer has outstanding tax, late payment interest or fine.

In case the taxpayer wishes to have the overpaid amount be offset against the outstanding tax, late payment interest or fine, late payment interest shall not be charged over the period from the date on which the overpaid amount is paid to the day on which these amounts are offset by the tax authority.

– In case the taxpayer claims a refund, the tax authority shall issue a refund decision or, if the claim is rejected, provide explanation within 05 working days from the receipt of the.

– The overpaid tax, late payment interest or fine shall not be refunded in the following cases:

In case the taxpayer fails to pay tax, late payment interest and fines within 30 days from the deadline for making such payment, the tax authority shall inform the taxpayer of the amount payable and the number of days behind schedule.

• The taxpayer no longer operates at the registered address, the overpaid amount has been announced through mass media and the taxpayer does not claim the refund within 01 years from the date of announcement.
• The overpaid amount has been paid for more than 10 years and the taxpayer does not request an offsetting or refund.

– In case the taxpayer no longer runs business at the address which has both overpaid and outstanding tax, late payment interest or fine, the tax authority shall offset the overpaid amount against the outstanding amount.

– The Minister of Finance shall provide for the power and procedures for handling of overpaid tax, late payment interest and fines mentioned in Article 60

Paying tax during settlement of complaints and lawsuits

– The time limit for settling complaints and lawsuits filed by taxpayers shall be decided by tax authorities. The taxpayers still have to pay the tax, late payment interest and fines unless a competent authority issues a decision to suspend the tax decision or tax liability imposition decision issued by the tax authority.

– If the paid tax, late payment interest or fine is greater than that determined by the court decision, judgment or the complaint settlement decision issued by a competent authority, the overpaid amount will be refunded.

The taxpayer is entitled to request the tax authority to pay an interest at 0,03% per day on the overpaid amount. The interest shall be paid by central government budget in accordance with regulations of law on state budget.

– Procedures for handling overpaid tax, late payment interest or fine mentioned in Clause 2 of Article 61 are specified in Clause 5 Article 60 of Law on Tax Administration.

Regulations on tax deferral

– A taxpayer may apply for tax deferral in one of the following cases:

• The taxpayer’s business suffers damage due to a force majeure events specified in Clause 27 Article 3 of Law on Tax Administration;
• The taxpayer has to relocate the business location as requested by a competent authority and such relocation affects the business performance.

– A taxpayer eligible for tax deferral mentioned in Clause 1 of Article 62 may have part or all of the tax deferred.

– Tax may be deferred:

• For up to 02 years in the cases specified in Point a Clause 1 of Article 62;
• For up to 01 year in the cases specified in Point b Clause 1 of Article 6-

– The taxpayer will not incur fines and late payment interest on the outstanding tax during the deferral period.

– In consideration of the application for tax deferral, the head of the tax authority shall decide the amount of tax deferred and the deferral period.

*Tax deferral in special cases

The Government shall decide tax deferral for entities or business lines facing special difficulties in specific periods of time. Tax deferral must not lead to changes to the estimated state budget revenues decided by the National Assembly.

*Application for tax deferral

– A taxpayer eligible for tax deferral as prescribed in Law on Tax Administration shall prepare and send an application for tax deferral to the supervisory tax authority.

– An application for tax deferral consists of:

• An application form specifying the reasons for deferral, the amount of tax and the deferral period;
• Documents supporting the reasons for deferral.

– The Minister of Finance shall specify the composition of the application for tax deferral.

*Receipt and processing of application for tax deferral

– Tax authorities shall receive applications for tax deferral:

• In person at the tax authorities;
• By post;
• Electronically through online portals or tax authorities.

– The tax authority shall process an application for tax deferral as follows:

• If the application is valid, send a notice of eligibility for tax deferral to the taxpayer within 10 working days from the receipt of the application;
• If the application is invalid, send a notice to the taxpayer within 03 working days from the receipt of the application.

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Conclusion: So the above is Regulations on tax payment under Viet Nam Law on Tax Administration. Hopefully with this article can help you in life, please always follow and read our good articles on the website: lsxlawfirm.com