Guidance on Declaration and Payment of After-Tax Profits Remaining After Fund Appropriation for 100% State-Owned Enterprises

Accordingly, the declaration and payment of post-tax profits remaining after the establishment of enterprise funds with 100% State capital are guided by Circular 61 as follows:

- Quarterly, based on the quarterly business performance results, enterprises shall temporarily pay the post-tax profits remaining after establishing the funds due to the State budget of the quarter no later than the 30th (thirtieth) day of the quarter following the quarter in which the obligation to pay the post-tax profits remaining after establishing the funds arises.

- At the end of the financial year, based on the financial statements, the enterprise shall finalize the declaration of the post-tax profits remaining after establishing the funds that must be paid into the State budget according to the Declaration Form 01/QT-LNCL issued together with this Circular and pay the post-tax profits remaining after establishing the funds that must be paid (if any) no later than the 90th (ninetieth) day, from the end of the calendar year or financial year.

- In case, at the time of finalizing the post-tax profits remaining after establishing the funds, the enterprise does not have a decision issued by the owner announcing the enterprise's classification results, the enterprise's classification will be based on the enterprise classification report sent by the enterprise to the owner.- If there is no enterprise classification report sent to the owner, the enterprise shall temporarily evaluate the enterprise classification to serve as a basis for establishing the funds and determining the post-tax profits remaining after establishing the funds to be paid into the State budget.

- After the decision to announce the enterprise classification results is issued by the owner, if there is a change in the enterprise classification, the enterprise will re-determine the fund establishment and the post-tax profits remaining after establishing the funds that must be paid into the State budget to declare and adjust the finalization of the post-tax profits remaining after establishing the funds and pay the additional amount (if any) into the State budget as per regulations.

- In the event of yearly finalization or upon the decision to announce the enterprise classification by the owner, if there is a post-tax profit remaining after establishing the funds that has already been paid into the State budget greater than the actual payable amount, the enterprise will be allowed to reduce this amount from the payable amount in the following period.

- Additionally, Circular 61 stipulates in cases where enterprises perform division, separation, consolidation, merger, equitization, or termination of activities as a single-member limited liability company, the enterprise is responsible for finalizing the post-tax profits remaining after establishing the funds up to the point of division, separation, consolidation, merger, equitization, or termination of activities and paying the post-tax profits remaining after establishing the funds into the State budget no later than the 45th (forty-fifth) day from the date of division, separation, consolidation, merger, equitization, or termination of activities as per the decision of competent authorities.

See details Circular 61/2016/TT-BTC effective from May 26, 2016.

-Thao Uyen-

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