Shall a newly established enterprise of 6 months submit PIT finalization if such organization does not pay any income in Vietnam?

Shall a newly established enterprise of 6 months submit PIT finalization if such organization does not pay any income in Vietnam?

Based on Sub-section 2, Section 2 Official Dispatch 636/TCT-DNNCN in 2021 guiding the PIT finalization issued by the General Department of Taxation of Vietnam, it is stated that "If the organization does not pay any income, it does not need to declare PIT finalization." In case of income generation, even if personal income tax is not deducted, the PIT finalization dossier must still be submitted.

Thus, according to the above legal provisions, if a newly established enterprise of 6 months does not pay any income, it does not need to declare PIT finalization.

Shall a newly established enterprise of 6 months submit PIT finalization if such organization does not pay any income in Vietnam? (Image from Internet)

What documents are required for the PIT finalization dossier for newly established enterprises in Vietnam?

Based on Sub-section 1, Section 4 Official Dispatch 636/TCT-DNNCN in 2021, the PIT finalization dossier for newly established enterprises includes the following documents:

[1] PIT finalization declaration form No. 05/QTT-TNCN issued together with Appendix 2 Circular 80/2021/TT-BTC. (Download)

[2] Detailed list of individuals subject to progressive tax rates form No. 05-1/BK-QTT-TNCN issued together with Appendix 2 Circular 80/2021/TT-BTC. (Download)

[3] Detailed list of individuals subject to full tax rates form No. 05-2/BK-QTT-TNCN issued together with Appendix 2 Circular 80/2021/TT-BTC. (Download)

[4] Detailed list of dependents for family deduction form No. 05-3/BK-QTT-TNCN issued together with Appendix 2 Circular 80/2021/TT-BTC. (Download)

Note: Individuals authorizing the income-paying organization to finalize on their behalf should

Fill in the PIT finalization authorization form for the tax period of 2023 according to form No. 08/UQ-QTT-TNCN issued together with Appendix 2 Circular 80/2021/TT-BTC. (Download)

Where should newly established enterprises submit their PIT finalization dossier in Vietnam?

According to Sub-section 2, Section 4 Official Dispatch 636/TCT-DNNCN in 2021 the regulations are as follows:

PROCEDURE FOR TAX FINALIZATION DECLARATION

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2. Place for submitting tax finalization dossier

The place to submit the PIT finalization dossier is specifically guided in Clause 8, Article 11 of Decree No. 126/2020/ND-CP dated October 19, 2020, of the Government of Vietnam. In case individuals declare and submit the PIT finalization declaration at the website https://canhan.gdt.gov.vn, the system will assist in determining the tax agency for finalization based on the information related to the tax obligations generated during the year declared by the individuals.

The specific place to submit the PIT finalization dossier is determined as follows:

2.1. For income-paying organizations, the place to submit the PIT finalization dossier is the tax agency directly managing the income-paying organization.

According to the above regulations, newly established enterprises should submit their PIT finalization dossiers to the tax agency that directly manages the income-paying organization.

Thus, newly established enterprises should submit their PIT finalization dossier to the local tax agency where the businesses operate.

What is PIT finalization? What is the latest deadline for PIT finalization in Vietnam?

Based on Clause 10, Article 3 Law on Tax Administration 2019 regarding the explanation of tax finalization declaration as follows:

10. Tax finalization declaration is the determination of the payable tax amount for the tax year or from the beginning of the tax year to the termination of the activity generating tax obligations or from the time of generation to the termination of the activity generating tax obligations according to the law.

Tax finalization declaration simply means determining the payable tax amount for the tax year or the period from the beginning of the tax year to the termination of the activity generating tax obligations or from the generation to the termination of the activity generating tax obligations.

Based on Clause 2, Article 44 Law on Tax Administration 2019 regulating the deadline for submitting tax declaration dossiers for taxes calculated annually, the provisions are as follows:

Deadline for submitting tax declaration dossiers

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2. The deadline for submitting tax declaration dossiers for annually calculated taxes is regulated as follows:

a) No later than the last day of the third month from the end of the calendar year or fiscal year for the annual tax finalization dossier; no later than the last day of the first month of the calendar year or fiscal year for the annual tax declaration dossier;

b) No later than the last day of the fourth month from the end of the calendar year for PIT finalization dossiers of individuals who directly finalize the tax;

c) No later than December 15 of the preceding year for the tax declaration dossiers of business households and individuals declaring tax using the presumptive method; in the case of new business households and individuals, the deadline for submitting the tax dossier is 10 days from the start of the business.

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Thus, PIT finalization is determining the payable tax amount for the tax year or from the beginning of the tax year to the termination of the activity generating tax obligations or from the generation to the termination of the activity generating tax obligations.

The latest deadline for PIT finalization is December 15 of the preceding year for the tax declaration dossiers of business households and individuals declaring tax using the presumptive method, and no later than 10 days from the start of the business for new business households and individuals.