Is an employee required to register a TIN before starting work in Vietnam?

Is an employee required to register a TIN before starting work in Vietnam?

Based on Article 33 of the Tax Administration Law 2019, it is stipulated as follows:

Deadline for initial taxpayer registration

1. Taxpayers must complete taxpayer registration alongside business registration, cooperative registration, or business registration. The deadline for taxpayer registration is the same as the deadline for business registration, cooperative registration, or business registration as stipulated by law.

2. For direct taxpayer registration with the tax authority, the registration deadline is 10 working days from the following dates:

a) Issuance of a business registration certificate, establishment and operation license, investment registration certificate, or establishment decision;

b) Commencement of business activities for organizations not required to register for business or household businesses, business individuals required to register but not yet issued a business registration certificate;

c) When tax withholding and tax payment responsibilities arise; when organizations pay taxes on behalf of individuals under business contracts or cooperation agreements;

d) Contract signing with foreign contractors, subcontractors for direct tax declaration and payment to the tax authority; signing contracts, petroleum agreements;

dd) When personal income tax obligations arise;

e) When there is a request for tax refunds;

g) When other obligations to the state budget arise.

3. Organizations or individuals paying income are responsible for taxpayer registration on behalf of individuals, in the case the individual does not have a TIN, within 10 working days from the date the tax obligation arises. They must also register for the dependents of the taxpayer within 10 working days from the date the taxpayer registers for personal deductions according to legal regulations if the dependents do not have a TIN.

According to these regulations, the law requires an individual to register a TIN within 10 working days from the occurrence of the aforementioned cases, excluding cases before employment commencement or before signing a labor contract or work contract.

However, the law mandates that organizations or individuals paying income to employees must undertake responsibility for tax identification registration on behalf of their employees if the employee does not already have one, within a maximum of 10 days from the date when the tax obligation arises.

Thus, employees are only required to register a TIN when personal income tax liability arises or in any of the situations that necessitate tax identification registration as mentioned above.

If an employee incurs personal income tax obligations while employed and receiving salaries from the employer without having a TIN, the employer is responsible for registering the TIN on behalf of the employee.

Therefore, employees are not obligated to register a TIN before commencing employment.

Is an employee required to register a TIN before starting work in Vietnam? (Image from the Internet)

How long does an employer have to register a TIN for employees in Vietnam?

According to Clause 3, Article 33 of the Tax Administration Law 2019, it is stated:

Deadline for initial taxpayer registration

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3. Organizations or individuals paying income are responsible for taxpayer registration on behalf of individuals receiving income, in the case the individual does not have a TIN, within 10 working days from the date the tax obligation arises. They must also register for the dependents of the taxpayer within 10 working days from the date the taxpayer registers for family deductions according to laws if the dependents do not have a TIN.

In compliance with the above regulations, the law requires organizations or individuals paying income to employees to undertake the responsibility of registering the TINs on behalf of their employees within no more than 10 days from the date when the tax obligation arises if the employee does not already possess a TIN.

Hence, an employer is obligated to register a TIN for employees within a maximum period of 10 days from the date the employee's tax obligation arises, assuming they have no TIN.

Should the employer fail to comply with this registration deadline, it will be subject to penalties according to the law.

How is the TIN used in Vietnam?

Based on Article 35 of the Tax Administration Law 2019, the use of the TIN is stipulated as follows:

- Taxpayers must include the issued TIN on invoices, vouchers, and documents when conducting business transactions; when opening deposit accounts at commercial banks or other credit institutions; in tax declarations, payments, exemptions, reductions, refunds, non-collection; in customs declaration registration and other tax-related transactions concerning all obligations towards the state budget, including cases where the taxpayer operates production or business in multiple locations.

- Taxpayers must provide the TIN to relevant authorities or organizations, or annotate the TIN on the file when conducting administrative procedures in a one-stop interconnection mechanism with the tax administration agency.

- Tax management agencies, the State Treasury, commercial banks cooperating in state budget collection, organizations authorized by tax agencies to collect taxes must use the taxpayer's TIN in tax management and collection into the state budget.

- Commercial banks, other credit institutions must inscribe the TIN on account opening documents and transaction documents through the taxpayer's account.

- Other organizations or individuals involved in tax management must use the taxpayer's issued TIN when providing information related to determining tax obligations.

- When Vietnamese parties make payments to entities or individuals engaging in cross-border business activities based on a digital intermediary platform not located in Vietnam, they must use the issued TIN for these entities or individuals for tax withholding and payment.

- When individual identification numbers are issued to the entire population, these numbers shall replace the TINs.