Shall the police impose tax liability if the taxpayer is suspected liquidating assets to avoid tax obligations in Vietnam?

Shall the police impose tax liability if the taxpayer is suspected liquidating assets to avoid tax obligations in Vietnam?

Based on Clause 10, Article 14 of Decree 126/2020/ND-CP, the regulation is as follows:

Cases of tax liability imposition

Taxpayers will be imposed by the tax authority to determine the tax amount in the following cases:

1. Not registering for taxpayer status as stipulated in Article 33 of the Law on Tax Administration.

2. Failing to file taxes or filing incomplete, untruthful, or inaccurate tax returns as stipulated in Article 42 of the Law on Tax Administration.

3. Not submitting additional tax documents upon request from tax authorities, or submitting them but they are incomplete, untruthful, or inaccurate concerning the tax calculation basis to determine the payable tax amount.

4. Not reflecting or inadequately reflecting complete, truthful, accurate figures in the bookkeeping to determine tax obligations.

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10. Showing signs of fleeing or liquidating assets to avoid tax obligations.

Additionally, based on Clause 1, Article 16 of Decree 126/2020/ND-CP, the regulation is as follows:

Authority, Procedures, and Decision on tax liability imposition

1. Authority for tax liability imposition

The General Director of the General Department of Taxation; Director of the Department of Taxation; Head of the Tax Branch has the authority to impose tax.

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Therefore, according to the above regulation, a business showing signs of fleeing or liquidating assets to avoid tax obligations is a behavior subject to tax liability imposition. However, the authority does not lie with the police but instead with the General Director of the General Department of Taxation; Director of the Department of Taxation; Head of the Tax Branch.

Shall the police impose tax liability if the taxpayer is suspected liquidating assets to avoid tax obligations in Vietnam? (Image from the Internet)

Shall the tax liability imposition decision be sent to the taxpayer in Vietnam?

Based on Point a, Clause 3, Article 16 of Decree 126/2020/ND-CP guiding the Law on Tax Administration, the regulation is as follows:

Authority, Procedures, and Decision on tax liability imposition

1. Authority for tax liability imposition

The General Director of the General Department of Taxation; Director of the Department of Taxation; Head of the Tax Branch has the authority to impose tax.

2. Procedures for tax liability imposition

a) When imposing tax, the tax authority shall notify the taxpayer in writing about the tax liability imposition and issue a tax liability imposition decision. The tax liability imposition decision must clearly state the reason for imposement, the basis for imposement, the imposed tax amount, and the tax payment deadline.

b) In cases where the tax authority conducts tax liability imposition through tax inspection, tax audits, the reason for imposement, the basis for imposement, the imposed tax amount, the tax payment deadline must be recorded in the tax inspection report, tax audit report, and the tax handling decision of the tax authority.

c) In cases where a taxpayer is imposed as per the regulation, the tax authority imposes administrative penalties and calculates late payment interest according to the law.

3. Decision on tax liability imposition

a) When imposing tax, the tax authority must issue a tax liability imposition decision using Form No. 01/ADT in Appendix III attached to this Decree, and send it to the taxpayer within three working days from the date the tax liability imposition decision is signed;

Taxpayers subject to payment based on tax authority notifications are not required to receive a tax liability imposition decision under this clause.

b) Taxpayers must pay the imposed tax amount according to the tax handling decision of the tax administration. If taxpayers disagree with the imposed tax amount, they must still pay the tax but have the right to request the tax authority to explain or file a complaint or lawsuit regarding the tax liability imposition.

Thus, when a tax authority imposees tax, it must issue a tax liability imposition decision according to the specified template and send it to the taxpayer within three working days from when the tax liability imposition decision is signed.

What are cases of tax liability imposition in Vietnam?

Based on Article 14 of Decree 126/2020/ND-CP, taxpayers are imposed by the tax authority for the payable tax amount in the following cases:

- Not registering for taxpayer status as stipulated in Article 33 of the Law on Tax Administration.

- Failing to file taxes or filing incomplete, untruthful, or inaccurate tax returns as stipulated in Article 42 of the Law on Tax Administration.

- Not submitting additional tax documents upon request from tax authorities, or submitting them but they are incomplete, untruthful, or inaccurate concerning the tax calculation basis to determine the payable tax amount.

- Not reflecting or inadequately reflecting complete, truthful, accurate figures in the bookkeeping to determine tax obligations.

- Not presenting accounting books, invoices, documents, and necessary materials required to determine tax calculation factors; determining payable tax amounts within the prescribed time limit or after the tax inspection, tax audit period at the taxpayer's headquarters.

- Not complying with the tax inspection decision within ten working days from the date of signing, except in cases where the inspection is postponed according to the regulation.

- Not complying with the tax audit decision within fifteen days from the date of signing, except in cases where the audit is postponed according to the regulation.

- Buying, selling, exchanging, and accounting the value of goods, services not according to the usual market transaction value.

- Purchasing, exchanging goods, services using illegal invoices, illegal use of invoices while goods, services actually exist as determined by the competent investigative, inspection, audit agencies and have been declared for revenue, cost for tax calculation.

- Showing signs of fleeing or liquidating assets to avoid tax obligations.

- Conducting transactions that do not reflect the economic substance, not consistent with actual operations to reduce the taxpayer's tax obligations.

- Not complying with the declaration obligation, determining the value of associated transactions, or not providing information according to the regulations on tax management for enterprises conducting associated transactions.