Shall an enterprise deactivate its TIN due to merger in Vietnam?

Shall an enterprise deactivate its TIN due to merger in Vietnam?

The cases in which an enterprise must deactivate its TIN are stipulated in Clauses 1 and 2, Article 39 of the Law on Tax Administration 2019 as follows:

- Enterprises with taxpayer registration along with enterprise registration, cooperative registration, business registration shall deactive the validity of the TIN in the following cases:

+ deactivion of business operations or dissolution, bankruptcy.

+ Revocation of enterprise registration certificate, cooperative registration certificate, business registration certificate.

+ Division, merger, or consolidation.

- Enterprises with taxpayer registration directly with the tax authority shall deactive the validity of the TIN in the following cases:

+ deactivion of business activities, no longer incurring tax obligations for non-business organizations.

+ Revocation of the business registration certificate or equivalent license.

+ Division, merger, or consolidation.

+ Notification from the tax authority that the taxpayer is not operating at the registered address.

+ Foreign contractors upon contract completion.

+ Contractors or investors participating in oil and gas contracts upon deactivion or transfer of all contractual rights.

Thus, in accordance with the above regulations, an enterprise that has merged will fall under the case of deactivating the TIN (deactiving the validity of the TIN).

Is a merged enterprise required to deactivate the TIN in Vietnam? (Image from the Internet)

What are the principles for TIN deactivation in Vietnam?

Based on Clause 3, Article 39 of the Law on Tax Administration 2019, the principles for TIN deactivation are as follows:

[1] The TIN shall not be used in economic transactions from the date the tax authority announces the deactivion of its validity;

[2] The TIN of an organization, once its validity has ended, shall not be reused, except as stipulated in Article 40 of the Law on Tax Administration 2019;

[3] The TIN of a household business or individual business, upon its invalidation, will not invalidate the TIN of the representative of the household business and can be used for other tax obligations by that individual;

[4] When an enterprise, economic organization, other organization, or individual deactives the validity of a TIN, they must simultaneously deactive the validity of the substituting TIN;

[5] If a taxpayer being the parent unit deactives the validity of its TIN, the dependent units must also have their TINs invalidated.

Vietnam: What does an application for TIN reactivation include?

- The documents for restoring a taxpayer's TIN are stipulated in Clause 1, Article 18 of Circular 105/2020/TT-BTC as follows:

+ Request for restoration of the TIN form No. 25/DK-TCT Download issued with Circular 105/2020/TT-BTC;

+ A copy of the document deactivating the decision to revoke the establishment and operation license or equivalent license by the competent authority.

- If the tax authority issues a Notification that the taxpayer is not operating at the registered address as per the provisions of Article 17 of Circular 105/2020/TT-BTC but has not yet revoked the enterprise registration certificate, cooperative registration certificate, branch operation registration certificate, representative office registration certificate, household business registration certificate, establishment and operation license, or equivalent license, and the TIN has not been deactived, the taxpayer submits a Request for restoration of the TIN form No. 25/DK-TCT Download issued with Circular 105/2020/TT-BTC to the directly managing tax authority before the issuance of the Notification on the deactivion of the TIN validity by the tax authority as stipulated.

- Taxpayers as defined in Clause 2, Article 4 of Circular 105/2020/TT-BTC who wish to continue business operations after having submitted the dossier for deactivion of TIN validity to the tax authority but the tax authority has not yet issued a Notification on the deactivion of TIN validity, shall submit a Request for restoration of the TIN Download form No. 25/DK-TCT issued with Circular 105/2020/TT-BTC to the directly managing tax authority before the date that the tax authority issues the Notification on the deactivion of the TIN validity.

- Taxpayers who have submitted the dossier for deactivion of TIN validity due to division, consolidation, or merger to the tax authority and subsequently receive a document revoking the Decision to divide, merger contract, consolidation contract, and the business registration authority, cooperative registration authority have not yet deactived operations for the divided, merged, or consolidated enterprise, or cooperative then the taxpayer submits a dossier requesting restoration of the TIN to the directly managing tax authority before the tax authority issues a Notification on the deactivion of TIN validity as stipulated in Article 16 of Circular 105/2020/TT-BTC.

The dossier includes:

- Request for restoration of the TIN form No. 25/DK-TCT Download issued with Circular 105/2020/TT-BTC.

- A copy of the document revoking the Division Decision, Merger Contract, and Consolidation Contract.

Taxpayers must complete all tax obligations and invoices as stipulated in Clause 4, Article 6 of Decree 126/2020/ND-CP.

What are regulations on handling of application for TIN reactivation in Vietnam?

According to Article 19 of Circular 105/2020/TT-BTC, the regulations are as follows:

- For taxpayer dossiers: The tax authority receives, processes the TIN restoration dossier, and delivers the result to the taxpayer as per the provisions in Article 40, Article 41 of the Law on Tax Administration 2019 and Clause 4, Article 6 of Decree 126/2020/ND-CP, dated October 19, 2020, of the Government of Vietnam detailing some provisions of the Law on Tax Administration and the following regulations:

+ Within 03 (three) working days from receipt of the TIN restoration request dossier from the taxpayer meeting the conditions stipulated in Point a, Clause 1, Article 18 of Circular 105/2020/TT-BTC, the tax authority shall:

++ Issue Notification on TIN restoration form No. 19/TB-DKT [Download](https://cdn.lawnet.vn/uploads/giao-duc/LDK/mau-so-19-tb-dkt.doc), Notification on TIN restoration as per the parent unit form No. 37/TB-DKT [Download](https://cdn.lawnet.vn/uploads/giao-duc/LDK/mau-so-37-tb-dkt.doc) (if applicable) issued with this Circular to the taxpayer, subsidiary units (if the restored TIN belongs to the parent unit).
++ Reprint the taxpayer registration certificate or TIN Notification for the taxpayer if the original has been submitted to the tax authority in the deactivated TIN dossier.
++ Update the TIN status for the taxpayer on the taxpayer registration application system either on the same working day or no later than the beginning of the next working day following the issuance of the Notification on TIN restoration.

+ Within 10 (ten) working days from receipt of the complete TIN restoration request dossier from the taxpayer for cases stipulated at Point b, Clause 1, Article 18 of Circular 105/2020/TT-BTC, the tax authority shall compile a list of missing tax declarations, report the invoice usage, the tax amount, and other amounts due to the state budget, and implement penalties for tax-related violations up to the point the taxpayer submitted the restoration request, concurrently verify the actual status at the taxpayer's registered business address and draft a verification report on the operational status of the taxpayer at the registered address using form No. 15/BB-BKD issued with this Circular by the request for TIN restoration from the taxpayer (the taxpayer must sign to acknowledge the report).

Within 03 (three) working days from the date the taxpayer fully complies with tax and invoice administrative violations, pays off the tax amount and other amounts due to the state budget:

++ Issue Notification on TIN restoration to the taxpayer form No. 19/TB-DKT [Download](https://cdn.lawnet.vn/uploads/giao-duc/LDK/mau-so-19-tb-dkt.doc), Notification on TIN restoration as per the parent unit form No. 37/TB-DKT [Download](https://cdn.lawnet.vn/uploads/giao-duc/LDK/mau-so-37-tb-dkt.doc) (if applicable) issued with this Circular, sent to the taxpayer, and subsidiary units (if the restored TIN belongs to the parent unit).
++ Reprint the taxpayer registration certificate or TIN Notification for the taxpayer if the original has been submitted to the tax authority in the deactivated TIN dossier.
++ Update the TIN status for the taxpayer on the taxpayer registration application system either on the same working day or no later than the beginning of the next working day following the issuance of the Notification on TIN restoration.

The tax authority publicly announces the Notification on TIN restoration on the General Department of Taxation's electronic information portal according to the provisions in Article 22 of Circular 105/2020/TT-BTC. State management agencies within the locality (including: customs offices, business registration offices (except in cases where business and taxpayer registration is integrated), Procuracies, police agencies, market management agencies, agencies issuing establishment and operational licenses), and other organizations or individuals are responsible for referencing the information and TIN status of the taxpayer that has been publicly announced by the tax authority to perform state management and other tasks.

+ Within 10 (ten) working days from receiving the complete TIN restoration request dossier from the taxpayer for cases stipulated at Points c, d, Clause 1, Article 18 of Circular 105/2020/TT-BTC, the tax authority prepares a list of missing tax declarations, reports on invoice usage, tax amount, and other due amounts to the state budget, and penalizes for tax-related violations will be carried out until the taxpayer submits the TIN restoration request, as required.

Within 03 (three) working days from the moment the taxpayer fully complies with tax and invoice administrative violations, settles the tax obligations and outstanding amounts to the state budget (except for certain cases where tax debt and other obligations to the state budget are not required to be finalized as stipulated in Clause 4, Article 6 of Decree 126/2020/ND-CP):

++ Issue Notification on TIN restoration for the taxpayer form No. 19/TB-DKT [Download](https://cdn.lawnet.vn/uploads/giao-duc/LDK/mau-so-19-tb-dkt.doc), Notification on TIN restoration as per the parent unit form No. 37/TB-DKT [Download](https://cdn.lawnet.vn/uploads/giao-duc/LDK/mau-so-37-tb-dkt.doc) (if applicable) issued with this Circular, sent to the taxpayer and the dependent unit (if the TIN is restored as the parent unit).
++ Reprint the taxpayer registration certificate or TIN Notification for the taxpayer if the original has been submitted to the tax authority in the deactivated TIN dossier.
++ Update the TIN status for the taxpayer on the taxpayer registration application system either on the same working day or no later than the beginning of the next working day following the issuance of the Notification on TIN restoration.

+ If the taxpayer submits an incomplete or incorrect request for TIN restoration that does not meet the criteria specified in Clause 1, Article 18 of this Circular, the tax authority issues a Notice of non-restoration of the TIN using form No. 38/TB-DKT sent to the taxpayer.

- When the tax authority receives a court decision deactivating the declaration of an individual's death, disappearance, or incapacity, it must restore the TIN for the individual within 03 working days from receiving the court's decision.

- When the tax authority receives a transaction restoring the legal status of enterprises, cooperatives, branches, representative offices, or business locations from the business registration authority, cooperative registration agency as per the legal provisions on business registration and cooperative registration on the taxpayer registration application system, it must restore the TIN for the taxpayer on the same day of receiving the transaction.