How much is the fine for employers delaying taxpayer registration for employees in Vietnam?
Shall the employer register tax for employees in Vietnam?
Based on Clause 3, Article 33 of the Law on Tax Administration 2019 regulating the time limit for taxpayer registration as follows:
Initial taxpayer registration time limit
...
3. Organizations and individuals that pay income are responsible for taxpayer registration on behalf of individuals earning income, no later than 10 working days from the date tax obligation arises if the individual does not have a tax identification number; taxpayer registration on behalf of the taxpayer's dependents no later than 10 working days from the date the taxpayer registers for family deduction according to legal regulations if the dependent does not have a tax identification number.
Therefore, employers are responsible for taxpayer registration for employees no later than 10 working days from the date tax obligations arise if the employees do not have a tax identification number.
How much is the fine for employers delaying taxpayer registration for employees in Vietnam? (Image from the Internet)
How much is the fine for employers delaying taxpayer registration for employees in Vietnam?
Based on Clause 1, Article 3 of Decree 125/2020/ND-CP regulating the subjects of administrative penalties for tax and invoice violations as follows:
Subjects of Administrative Penalties for Tax and Invoice Violations
- Subjects of administrative penalties for tax and invoice violations include:
a) Taxpayers committing administrative violations of tax and invoices.
If the taxpayer authorizes another organization or individual to perform tax-related obligations as stipulated by tax and tax management law responsibilities for the authorized party, and the authorized party commits administrative violations as regulated in this Decree, the authorized organization or individual will be penalized according to this Decree.
In cases where tax and tax management law mandates organizations and individuals to register, declare, and pay taxes on behalf of the taxpayer, and these organizations or individuals commit administrative violations as stipulated in this Decree, such organizations or individuals will face administrative penalties related to tax according to this regulation.
...
Furthermore, based on Article 10 of Decree 125/2020/ND-CP regulating penalties for violations of the taxpayer registration time limit, the following applies:
Penalties for Violations of the taxpayer registration time limit; Notification of Temporary Business Suspension; Notification of Business Resumption Before the Announced Date
- A warning will be issued for acts of taxpayer registration; notification of temporary business suspension; or notification of business resumption before the announced date that exceeds the prescribed time limit from 01 day to 10 days and with mitigating circumstances.
- A fine from 1,000,000 VND to 2,000,000 VND for one of the following acts:
a) Tax registration; notification of business resumption before the announced date exceeding the prescribed time limit from 01 day to 30 days, excluding cases specified in Clause 1 of this Article;
b) Notification of temporary business suspension exceeding the prescribed time limit, excluding cases specified in Clause 1 of this Article;
c) Failure to notify the temporary business suspension.
- A fine from 3,000,000 VND to 6,000,000 VND for acts of taxpayer registration; notification of business resumption before the announced date exceeding the prescribed time limit from 31 to 90 days.
- A fine from 6,000,000 VND to 10,000,000 VND for one of the following acts:
a) Tax registration; notification of business resumption before the announced date exceeding the prescribed time limit from 91 days onward;
b) Failure to notify the resumption of business before the announced date but no tax payment required;
Based on the above regulations, employers delaying taxpayer registration for employees will be fined as follows:
- A warning for taxpayer registration exceeding the stipulated time limit from 01 day to 10 days with mitigating circumstances.
- A fine from 1,000,000 VND to 2,000,000 VND for taxpayer registration exceeding the time limit from 01 day to 30 days.
- A fine from 3,000,000 VND to 6,000,000 VND for taxpayer registration; notification of business resumption before the announced date exceeding the time limit from 31 to 90 days.
- A fine from 6,000,000 VND to 10,000,000 VND for tax registration exceeding the time limit from 91 days onward.
Thus, a company delayed in registering a tax identification number on behalf of employees for violations of the registration time limit will face a maximum fine of 10,000,000 VND.
Note: The monetary fine mentioned above applies to organizations. For households and household businesses, the fine is half of that applied to organizations (Clause 4, Article 7 Decree 125/2020/ND-CP and Clause 5, Article 5 Decree 125/2020/ND-CP).
Where to submit employee taxpayer registration applications in Vietnam?
Based on Clause 3, Article 32 of the Law on Tax Administration 2019 stipulated as follows:
Location to Submit Initial taxpayer registration applications
- Taxpayers registering taxpayers along with business registration, cooperative registration, and business registration shall submit taxpayer registration applications at the location stated in business registration, cooperative registration, and business registration according to law.
- Taxpayers registering directly with the tax authority shall submit registration files at the following locations:
a) Organizations, business households, and individual businesses shall submit taxpayer registration applications at the tax authority where they have their headquarters;
b) Organizations and individuals responsible for deduction and tax payment on behalf shall submit taxpayer registration applications at the tax office directly managing those organizations and individuals;
c) Households and non-business individuals shall submit registration files at the tax office where taxable income arises, permanent residence registration, temporary residence registration, or where obligations to the state budget arise.
- Individuals authorizing organizations and individuals paying income to register taxpayers on behalf of themselves and dependents shall submit registration files through the organization and individuals paying the income. Those organizations and individuals are responsible for aggregating and submitting the taxpayer registration applications to the tax authority directly managing the organization and individual paying the income.
According to the above regulation, if an employer registers taxpayers on behalf of employees, the employer is responsible for aggregating and submitting the taxpayer registration applications on behalf of employees to the direct managerial tax authority of the employer.
