May an APA be revoked during the revision request in Vietnam?

What are the cases of APA revision in Vietnam?

Revising the APA is specified in clause 9, Article 41 of Decree 126/2020/ND-CP as follows:

Application of advance pricing agreement to enterprises having related-party transactions

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9. Revising the APA

a) An APA shall be revised in consideration of the taxpayer’s or the tax authority’s request.

An APA shall be revised in the following cases: There are changes to important presumptions due to objective reasons; changes in law affect the APA; revisions are requested by the other party’s tax authority and are accepted by the Ministry of Finance; other cases.

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Thus, an APA shall be revised in consideration of the taxpayer’s or the tax authority’s request in 04 cases as follows:

- There are changes to important presumptions due to objective reasons;

- There are changes in law affect the APA;

- There are revisions are requested by the other party’s tax authority and are accepted by the Ministry of Finance;

- other cases.

May an APA be revoked during the revision request in Vietnam?

The APA revocation is implemented under Clause 11, Article 41 of Decree 126/2020/ND-CP as follows:

Application of advance pricing agreement to enterprises having related-party transactions

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11. APA revocation

a) The APA may be revoked in the following cases: the taxpayer deliberately provides false or information or commits fraud in application of THE APA; revocation of the APA is requested by the other party's tax authority and accepted by the Ministry of Finance.

b) In case the APA is cancelled, General Department of Taxation shall issue a notice of APA revocation. The notice shall specify the reasons for revocation and revocation date. The taxpayer shall fulfill tax obligations mentioned in the revoked APA in accordance with applicable regulations on tax administration of enterprises having related-party transactions from the revocation date.

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Thus, the APA can be revoked if the taxpayer intentionally provides false information or commits fraud during the revision request.

* Note:

- In case the APA is revoked, the General Department of Taxation shall issue a notice of APA revocation. The notice shall specify the reasons for revocation and revocation date.

- The taxpayer shall fulfill tax obligations mentioned in the revoked APA in accordance with applicable regulations on tax administration of enterprises having related-party transactions from the revocation date

May an APA be revoked during the revision request in Vietnam? (Image from the Internet)

Which entity is responsible for handling the taxpayer's request for the revision of the signed APA in Vietnam?

Pursuant to the provisions in Clause 2, Article 10 of Circular 45/2021/TT-BTC on the responsibilities of tax authorities:

Article 10. Powers and responsibilities of tax authorities

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2. A tax authority has the following responsibilities

a) Within the power specified in Article 41 of the Decree No. 126/2020/ND-CP, the General Department of Taxation shall receive taxpayers' applications; process the taxpayers' applications for APA application, extension and revisionof signed APAs; invalidate or revoke signed APAs;

b) The tax authority has the responsibility to manage and inspect the implementation of signed APAs of taxpayers as prescribed in Clause 9 Article 20 of the Decree No. 132/2020/ND-CP within its jurisdiction, including inspecting and determining the implementation of regulations in the signed APAs; inspecting and determining tax declaration and payment and adjustment of taxable income under regulations in the signed APAs; inspecting and verify annual APA reports and ad hoc reports submitted by taxpayers.

The management and inspection by the tax authority aim to supervise taxpayers’ compliance with signed APAs and are not intended for re-appraising such signed APAs.

c) Every Provincial Department of Taxation shall take responsibility for the issues raised during the appraisal, discussion and negotiation of APAs within the scope of state management; for management and inspection of implementation of signed APAs within its functions and tasks.

Thus, under provisions of Article 41 of Decree 126/2020/ND-CP, the General Department of Taxation handles the taxpayer's request on the revision of the signed APA.