Vietnam: Does the terminal tax declaration dossier include a declaration of related-party transactions?

Vietnam: Does the terminal tax declaration dossier include a declaration of related-party transactions?

Based on Clause 2, Article 43 of the Tax Administration Law 2019 which regulates the tax declaration dossier, as follows:

Tax Declaration Dossier

1. The tax declaration dossier for taxes filed and paid monthly is a monthly tax declaration.

2. The tax declaration dossier for taxes filed and paid quarterly is a quarterly tax declaration.

3. The tax declaration dossier for taxes calculated annually includes:

a) The annual tax declaration dossier includes the annual tax declaration and other relevant documents related to determining the payable tax amount;

b) The terminal tax declaration dossier includes the annual tax finalization declaration, annual financial statements, declaration of related-party transactions; and other documents related to tax finalization.

...

In accordance with the above regulation, the terminal tax declaration dossier includes:

[1] Annual tax finalization declaration

[2] Annual financial statements

[3] declaration of related-party transactions

[4] Other documents related to tax finalization.

Therefore, the terminal tax declaration dossier will need to include a declaration of related-party transactions.

Vietnam: Does the terminal tax declaration dossier include a declaration of related-party transactions? (Image from the Internet)

What are cases where employees finalize personal income tax directly in Vietnam?

Based on Section 1 of Official Dispatch 883/TCT-DNNCN of 2022 guiding personal income tax finalization issued by the General Department of Taxation, individuals must finalize personal income tax directly with the tax authority if they fall into the following cases:

- Residents with income from salaries, wages from two or more places who do not meet the conditions to authorize finalization, according to the regulations, must directly file for personal income tax finalization with the tax authority if there is an additional tax payable or a request for a tax refund or offset into the next tax declaration period.

- Individuals present in Vietnam for less than 183 days in the first calendar year, but for 183 days or more in 12 consecutive months from the first day present in Vietnam, the first finalization year is 12 consecutive months from the first arrival day in Vietnam.

- Foreign individuals ending their working contracts in Vietnam must finalize their tax with the tax authority before leaving the country.

Individuals who have not yet performed tax finalization procedures with the tax authority should authorize the income-paying organization or another organization/individual to finalize taxes according to the tax finalization regulations for individuals.

If the income-paying organization or another organization, individual is authorized to finalize, they must be responsible for the additional personal income tax payable or refund of overpaid tax of the individual.

- Residents with income from salaries, wages paid from abroad or from international organizations, embassies, consulates that have not been withheld tax during the year, must directly finalize with the tax authority if there is additional tax payable or a request for a tax refund or offset into the next tax declaration period.

- Residents with income from salaries, wages simultaneously subject to tax reduction due to natural disasters, fires, accidents, or serious illness affecting their tax payment ability must not authorize the income-paying organization or individual to finalize taxes on their behalf but must directly file for finalization with the tax authority as prescribed.

Whata re cases where individuals with income from salaries or wages do not have to finalize personal income tax directly in Vietnam?

Based on Section 2 of Official Dispatch 883/TCT-DNNCN of 2022 guiding personal income tax finalization issued by the General Department of Taxation, individuals with income from salaries or wages do not have to finalize personal income tax directly in the following cases:

Individuals with income from salaries or wages in the following cases do not have to finalize personal income tax:

- Individuals with additional personal income tax payable after annual finalization of 50,000 VND or less. Individuals are exempted from tax in this case to self-determine the exempted tax amount, not required to submit personal income tax finalization paperwork and not required to submit tax exemption paperwork. For finalization periods from 2019 and earlier that have been finalized before the effective date of Decree 126/2020/ND-CP, they are not subject to retroactive action;

- Individuals whose personal income tax payable is less than the tax temporarily paid without requesting a refund or offset into the next tax declaration period;

- Individuals with income from wages or salaries under employment contracts of 03 months or more at one entity, simultaneously with sporadic income at other places with an average monthly amount not exceeding 10 million VND and have had personal income tax withheld at a rate of 10%. If there is no request, they do not have to finalize taxes for this income portion;

- Individuals whose employers purchase life insurance (excluding voluntary pension insurance), other non-compulsory insurance with accumulated insurance fees for which the employer or insurer has withheld personal income tax at a rate of 10% on the insurance fee corresponding to the portion purchased or contributed by the employer for the employee, then the employee is not required to finalize personal income tax for this income portion.