Is the Official Dispatch 188 on guidance for enterprises to prepare the 2025 tax report promulgated by the tax authority in Vietnam?

Is the Official Dispatch 188 on guidance for enterprises to prepare the 2025 tax report promulgated by the tax authority in Vietnam?

On January 13, 2025, the Taxation Department of Long An Province issued Official Dispatch 188/CTLAN-TTHT (2025)...Download to guide the implementation of tax reporting and some notices that enterprises must carry out at the beginning of 2025.

Specifically: in Official Dispatch 188/CTLAN-TTHT (2025)...Download, the following guidance is provided:

(1) Reports to be submitted for the 2024 tax year:

- Corporate income tax finalization:

+ Declare corporate income tax finalization

+ Financial statement

- Personal income tax finalization:

- Resource tax finalization:

(2) Tasks to be performed in 2025 include:

- Declare and pay business license tax

- Declare VAT

- Declare personal income tax from wages and salaries

- Declare non-agricultural land use tax for 2025

- Register depreciation method for fixed assets

- Tax agency

- Use invoice documents

- Information on tax, fee, and charge policies expiring from 2025

- Information on new tax, fee, and charge policies effective from 2025

See more contents of Official Dispatch 188/CTLAN-TTHT (2025) here...Download

Is the Official Dispatch 188 on guidance for enterprises to prepare the 2025 tax report promulgated by the tax authority in Vietnam? (Image from the Internet)

What are regulations on the declaration of personal income tax finalization in Vietnam in Official Dispatch 188?

At sub-section 3.2 Section 3 of Official Dispatch 188/CTLAN-TTHT (2025)...Download, instructions on declaring personal income tax finalization are as follows:

(1) For organizations and individuals paying income from wages and salaries:

Organizations and individuals paying income from wages and salaries are responsible for declaring personal income tax finalization regardless of whether there is tax deduction or not, and finalizing personal income tax on behalf of individuals who authorize it. In cases where individuals authorize personal income tax finalization to the organization and have an additional tax payable after finalization of up to VND 50,000 eligible for tax exemption, the organization or individual still declares the individual's income information on the organization's personal income tax finalization dossier without consolidating the additional tax payable of individuals with additional tax payable after finalization up to VND 50,000. For income-paying organizations that have finalized personal income tax before the effective date of Decree 126/2020/ND-CP, retrospective actions are not required.

In cases where an individual is transferred from the old organization to a new organization due to the old organization being merged, consolidated, divided, split, converted, or when both the old and new organizations belong to the same system, the new organization is responsible for finalizing personal income tax on behalf of the individual, covering income paid by the old organization, and retrieving tax deduction documents from the old organization for the individual (if any).

In the event that the income-paying organization or individual dissolves, goes bankrupt, terminates activities, ceases contracts, or reorganizes the enterprise, it must finalize personal income tax until the time of dissolution, bankruptcy, termination of activities, ceasing contracts, or reorganization of the business. If there is a conversion of business type (excluding state-owned enterprise equitization) where the converting enterprise inherits all tax obligations of the converted enterprise, tax finalization up to the point of conversion decision is not required, with finalization being conducted at year-end.

- Tax finalization declaration dossier:

+ Personal income tax finalization return using form 05/QTT-TNCN issued with Circular 80/2021/TT-BTC.

+ Appendix schedules 05-1/BK-QTT-TNCN; 05-2/BK-QTT-TNCN; 05-3/BK-QTT-TNCN issued with Circular 80/2021/TT-BTC.

- Deadline for filing the finalization dossier:

Enterprises must prepare and submit the personal income tax finalization dossier for 2024 no later than the last day of the third month from the end of the calendar year.

(2) For individuals directly settling with the Tax Authority

Resident individuals with income from wages and salaries from two or more places who do not meet the conditions for authorization of finalization according to regulations must directly declare personal income tax finalization with the tax authority if additional tax is payable or there is excess tax payment requesting reimbursement or offsetting in the next tax period.

Individuals present in Vietnam for less than 183 days in the first calendar year, but 183 days or more computed over 12 consecutive months from their initial day in Vietnam, will have their first finalization year covering these 12 consecutive months.

Foreign individuals concluding their working contracts in Vietnam must complete tax finalization with the tax authority prior to departure.

If individuals have not completed tax finalization procedures with the tax authority, they can authorize the income-paying organization or other organizations and individuals to finalize tax according to regulations applicable to individuals. If the income-paying organization or other entities accept the tax finalization authorization, they must assume responsibility for any additional personal income tax to be paid or for the tax reimbursement.

Resident individuals receiving wages and salaries paid from abroad or from International Organizations, Embassies, Consulates that have not deducted tax in the year must finalize directly with the tax authority if additional payment or excess payment for reimbursement is applicable or need offsetting in subsequent tax filings.

Resident individuals receiving wages and salaries qualifying for a tax reduction due to natural disasters, fire, accidents, serious illness affecting tax payment capabilities must not authorize income-paying organizations or individuals to finalize on their behalf but must directly declare finalization with the tax authority according to regulations.

- Dossier of individuals making direct tax declarations with the tax authority includes:

+ Form 02/QTT-TNCN: Personal income tax finalization return (applied to individuals with income from wages and salaries).

+ Schedule 02-1/BK-QTT-TNCN: Appendix for dependents deduction scheme.

+ Copies of documents proving tax deducted, provisional tax paid in the year, tax paid abroad (if any). If the income-paying organization does not issue tax withholding documents for individuals due to cessation of activities, the tax authority will consider the tax finalization dossier based on tax sector data without requiring tax withholding documents.

+ Copies of tax deduction certificates (indicating tax paid according to income tax returns) issued by the income-paying organization or bank receipt copies for tax paid abroad with taxpayer confirmation if the foreign jurisdiction's tax authority does not issue tax payment confirmations.

+ Copies of invoices and documents proving contributions to charity funds, humanitarian funds, study promotion funds (if any).

+ Documents verifying paid amounts from foreign entities or organizations providing income in the case of individuals receiving income from international organizations, Embassies, Consulates, or foreign states.

+ Documentation for dependent registration as specified in Appendix 2 of decree forms issued with Circular 80/2021/TT-BTC, dated September 29, 2021, of the Minister of Finance (if reducing tax is considered for dependents at finalization time for unregistered dependents).

- Deadline for filing tax finalization dossiers:

+ For personal income tax finalization dossiers of individuals directly finalizing tax, no later than the end of the fourth month from the close of the calendar year.

If the deadline for tax finalization falls on a holiday as per regulations, the deadline is the following working day. In cases where individuals have tax reimbursement arising but file their tax finalization late, they will not be fined for administrative violations of delayed tax finalization filing.

- Place for submitting tax finalization dossiers:

The location for personal tax finalization declaration submission directly with the tax authority is stated as follows:

For individuals directly declaring tax finalization:

+ Resident individuals with wage, salary income from one place who are required to self-declare tax in the year submit their tax finalization dossier to the tax authority where personal tax declarations were made within the year according to Point a, Clause 8, Article 11 of Decree 126/2020/ND-CP. In cases where individuals have income from wages, salaries at two or more places, including those with both directly declared and withheld income by employers, they submit their tax finalization dossier to the tax authority overseeing the largest income source for the year. If the largest income source is undetermined, individuals can choose to file at the tax authority managing the paying organization or where they reside.

+ Resident individuals earning wages or salaries from multiple places with income tax withheld at source from two or more places submit their finalization dossier as follows:

++ Individuals having calculated personal standard deductions at a specific income-paying organization or individual submit their tax finalization dossier to the tax authority managing that income-paying entity. If the individual changes work locations and the final income-paying entity calculates personal standard deductions, submission is made to the tax authority managing the final paying organization. If deductions are not calculated at the final organization, submission is to the tax authority where the individual resides. If personal deductions were not calculated at any paying organization, submit to the tax authority where the individual resides.

++ For resident individuals without labor contracts, labor contracts less than 3 months, or service contracts with income from one or multiple places and 10% withholding applied, submit to the tax authority where they reside.

++ Residents with income at one or multiple places but not employed at any income-paying entity at finalization, submit to the tax authority where they reside.

(3) For authorization of personal income tax finalization

Resident individuals with income from wages and salaries may authorize the paying organization or individual to finalize personal income tax. Specifically:

- Individuals with labor contracts of 3 months or longer at a single place and currently working there at the time of organization's tax finalization, even if not worked a full 12 months in the calendar year. If transferred due to organizational mergers, splits, or conversions within the same system, individuals can authorize tax finalization at the new organization.

- Individuals with labor contracts of 3 months or longer at one place who continue working at the time of organization's finalization; and having casual income not exceeding VND 10 million per month and subjected to 10% withholding can decline separate tax finalization on this income.

- After authorizing tax finalization, if the paying organization finalizes taxes on behalf of the individual, but it turns out the individual should directly finalize with the tax authority, the paying organization does not adjust its personal income tax finalization but issues a tax deduction certificate to the individual with notes like "Company ... has finalized personal income tax on behalf of Mr./Ms. .... (as authorized) at line (serial number) ... of Appendix Schedule 05-1/BK-TNCN” facilitating the individual's direct finalization with the tax authority. If tax withholding certificates are electronic, the organization should print and note as described on the final print for the taxpayer.

Note:

- Organizations paying wages should verify dependents registered with the tax authority according to regulations on the dependents authorized by the employee for registration, verifying number of dependents, and deduction periods.

- Tax finalization methods: Income-paying organizations implementing electronic tax declarations should submit tax finalization electronically via the e-tax service system, using the HTKK software without submitting paper files to the tax authority.

Individuals should draft tax finalization declarations (Form 02/QTT-TNCN) on the Electronic Tax Service System http://thuedientu.gdt.gov.vn, sign, and send physical copies to the tax authority identified above for tax finalization and any tax refund (if applicable) as per regulations. If individuals have been issued an e-tax transaction account, there is no need to submit tax finalization papers to the tax authority.

Which cases are not subject to tax finalization in Vietnam?

At sub-section 3.2 Section 3 of Official Dispatch 188/CTLAN-TTHT (2025)...Download, it is clearly stated which cases are not subject to personal income tax finalization as follows:

(1) For individuals

Individuals with income received from wages in the following cases are not required to finalize personal income tax:

- Individuals with additional personal income tax payable not exceeding VND 50,000 after finalization. Exempt individuals in this case estimate their own tax-exempt amount, not required to file personal income tax finalization and exemption dossiers. If finalization periods are from 2019 and earlier completed before Decree 126/2020/ND-CP became effective, retrospective measures are not applied.

- Individuals owing less income tax than provisionally paid amounts and have no reimbursement or offset request for the subsequent tax period.

- Individuals having labor contracts of 3 months or longer with one unit concurrently earning casual income at other places averaging less than VND 10 million per month and withheld at 10%, don't require tax finalization on this segment.

- Individuals whose employer purchases life insurance (except voluntary retirement insurance) or non-mandatory insurance with premium accumulation, where tax is withheld at 10% on the premium paid by the employer, are not required to finalize taxes on this income segment.

(2) For organizations, individuals paying income from wages

Organizations, individuals paying income from wages, who do not need to finalize personal income tax include those not making payments within the year or those temporarily ceasing activities or business throughout the calendar year.