Is the late payment interest included in the tax administration in Vietnam?

Is the late payment interest included in the tax administration in Vietnam?

Pursuant to Article 4 of the Law on Tax Administration 2019 stipulated as follows:

Tax Administration Content

1. Tax registration, tax declaration, tax payment, tax assessment.

2. Tax refund, tax exemption, tax reduction, tax non-collection.

3. Classifying tax debt; writing off tax debt, late payment interest, penalties; exempting late payment interest, penalties; not calculating late payment interest; extending tax payment; gradual repayment of tax debt.

4. Managing taxpayer information.

5. Managing invoices, documents.

6. Tax inspection, tax audit, and implementing measures to prevent and combat tax law violations.

7. Enforcing the implementation of administrative decisions on tax administration.

8. Administrative sanctioning of tax management violations.

9. Resolving tax complaints and denunciations.

10. International cooperation on tax.

11. Promoting and assisting taxpayers.

Thus, it can be seen that the late payment interest is part of tax administration content.

Is the late payment interest included in the tax administration in Vietnam? (Image from Internet)

How to determine the amount of late payment interest in Vietnam?

Pursuant to clause 1, Article 21 of Circular 80/2021/TT-BTC stipulated as follows:

Handling Late Tax Payment

1. Determining the Late Payment Fee

The determination of the amount of late payment is based on the amount of late tax payment, the days of late payment, and the rate of late payment as specified in Article 59 of the Law on Tax Administration 2019. The late payment interest period is calculated continuously from the day following the date of arising late payment interest to the day immediately preceding the date the taxpayer pays the tax debt into the state budget.*

2. Notification of Late Payment Fee

Monthly, the tax authority notifies the amount of late payment along with the tax debt notification (according to form No. 01/TTN attached to Annex I of this Circular) for taxpayers with tax debt overdue for 30 days or more. For non-agricultural land use tax, the tax authority notifies the tax debt amount and late payment fee to individual taxpayers and households through the authorized collection organization.

To resolve administrative procedures for taxpayers or upon the request of competent state agencies, the tax authority identifies and notifies tax debt up to the time the tax authority issues the notification (according to form No. 02/TTN issued with Annex I of this Circular).

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Thus, determining the amount of the late payment fee is based on the amount of late tax payment, the days of late payment, and the rate of late payment as specified in Article 59 of the Law on Tax Administration 2019.

What are procedures and application for exemption of late payment interest in Vietnam?

Based on Article 23 of Circular 80/2021/TT-BTC, the procedure and application for exemption of late payment fee are as follows:

- Procedure for resolving applications exempting late payment fee for cases stipulated in clause 8 Article 59 of the Law on Tax Administration 2019. Specifically:

+ The taxpayer prepares a application requesting exemption from late payment fee and sends it to the direct tax managing authority or the tax authority managing the state budget revenue.

+ In case the application requesting exemption from late payment is incomplete as per regulations, within 03 working days from the date of receipt, the tax authority must notify in writing according to form No. 01/TB-BSTT-NNT issued with Decree 126/2020/ND-CP Download requesting the taxpayer to clarify or supplement the application.

In case the application requesting exemption from late payment is complete as per regulations, within 10 working days from the date of receipt, the tax authority issues a Notice of non-approval of exemption from late payment (form No. 03/MTCN Download issued with Annex I Circular 80/2021/TT-BTC) for cases not eligible for exemption, or a Decision of exemption (form No. 02/MTCN Download issued with Annex I Circular 80/2021/TT-BTC) for cases eligible for exemption.

- Regarding the application for exemption from late payment

+ In cases of natural disasters, calamities, epidemics, fires, unexpected accidents, the application includes:

++ A request letter for exemption from late payment by the taxpayer according to form No. 01/MTCN Download issued with Annex I Circular 80/2021/TT-BTC;

++ Documents certifying the time, place of natural disasters, calamities, epidemics, fires, unexpected accidents by the competent authority (original or copy certified by the taxpayer);

++ Documents determining material damage value by the financial authority or independent appraisal agency (original or certified copy);

++ Documents (original or copy certified by the taxpayer) stipulating the responsibility of the organization, individual to compensate for damages (if any);

++ Documents (original or copy certified by the taxpayer) related to damage compensation (if any).

+ Other force majeure cases as stipulated in clause 1 Article 3 Decree 126/2020/ND-CP, the application includes:

++ A request letter for exemption from late payment by the taxpayer according to form No. 01/MTCN Download issued with Annex I Circular 80/2021/TT-BTC;

++ Documents determining the value of material damage by the financial authority or independent appraisal agency assessing the level, value of damage for cases due to war, riots, strikes causing taxpayers to stop production and business activities (original or certified copy);

++ Documents proving risks not caused by the taxpayer's subjective causes, and the inability of the taxpayer to finance the state budget payment for cases where the taxpayer faces risks not caused by subjective causes (original or certified copy by the taxpayer);

++ Documents (original or copy certified by the taxpayer) related to damage compensation by the insurance agency (if any).

- Additionally, regarding the authority to issue the decision of exemption from late payment

The head of the tax authority directly managing or the tax authority managing the state budget revenue issues the Decision of exemption from late payment according to form No. 04/MTCN issued with Annex I Circular 80/2021/TT-BTC.