Vietnam: What is the time limit for PIT refund from the date of submitting the tax refund application?

What is the time limit for PIT refund from the date of submitting the tax refund application in Vietnam?

Under Article 75 of the Tax Administration Law 2019:

Time limits for processing tax refund claims

1. In case a claim is eligible for refund before inspection, within 06 working days from the day on which the tax authority issues the notice of receipt of the claim, the tax authority shall decide whether to provide the refund, demand inspection before refund in the cases mentioned in Clause 2 Article 73 of this Law, or reject the claim if it is unqualified.

In case information on the tax refund claim is different from that of the tax authority, the tax authority shall request the taxpayer in writing to provide explanation and additional information. The time needed for providing explanation and additional information shall not be included in the time limit for processing tax refund claims.

2. In case a claim is subject to inspection before refund, within 40 working days from the day on which the tax authority issues the notice of receipt of the claim, the tax authority shall decide whether to provide the refund or reject the claim.

3. If the tax authority fails to issue the tax refund decision by the deadline specified in Clause 1 and Clause 2 of this Article, the tax authority shall pay an interest at 0,03% per day on the refundable and the number of days late. The interest shall be paid by central government budget in accordance with regulations of law on state budget.

Thus, the time limit for PIT refund is stipulated as follows:

- For applications subject to tax refund before inspection, no later than 6 working days from the date the tax authority issues a notification of acceptance of the application and the processing time for tax refund applications, the tax authority must decide to refund the tax to the taxpayer.

- For applications subject to inspection before the tax refund, no later than 40 days from the date the tax authority issues a written notification of acceptance of the application and the processing time for tax refund applications.

What is the time limit for PIT refund from the date of submitting the tax refund application in Vietnam? (Image from the Internet)

What documents are included in the PIT refund application for income from salaries and remunerations in Vietnam?

Under Clause 1, Article 42 of Circular 80/2021/TT-BTC:

Application for refund of overpayments

1. Application for refund of overpaid personal income tax (PIT) on income from salaries and remunerations

a) In case the income payer finalize tax as authorized by the individual, the application shall include:

a.1) The application form No. 01/DNXLNT in Appendix I hereof;

 a.2) The authorization letter in case the taxpayer does not apply for tax refund himself/herself, unless the tax agent submits the tax refund application under a contract between the tax agent and the taxpayer;

a.3) The list of tax payment documents according to Form No. 02-1/HT in Appendix I hereof (prepared by the income payer).

b) In case the income earner directly finalizes tax with the tax authority and has overpaid tax on the terminal PIT form, the tax refund application is not required.

The tax authority shall decide whether to refund overpaid tax according to PIT finalization dossier as per regulations.

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The PIT refund application for income from salaries and remunerations includes the documents specified above.

Download Form 01/DNXLNT here.

Download Form 02-1/HT here.

How many types of tax refund applications are there in Vietnam?

Under Article 73 of the Tax Administration Law 2019:

Classification of tax refund claims

1. A tax refund claim might be eligible for refund before inspection or subject to inspection before refund.

2. The following tax refund claims are subject to inspection before refund:

a) Tax refund claims submitted for the first time in the cases specified by tax laws. If a taxpayer’s first tax refund claim is rejected, the next claim will be considered the first.

b) Any claim submitted within 02 years from the day on which the penalties on the taxpayer’s tax evasion is imposed;

c) Claims submitted by organizations that are dissolved, bankrupt, shut down, sold or transferred to state-owned enterprises;

d) High-risk claims as classified by the risk management system;

dd) Any tax refund claim eligible for refund before inspection but the taxpayer fails to provide explanation or documents proving the declared tax, or the explanation or documents provided by the taxpayer is not convincing enough;

e) Claims for refund of taxes on exports or imports that are not paid for via a commercial bank or credit institution as prescribed by law;

g) Claims for refund of tax on exports or imports subject to inspection before refund prescribed by the Government.

3. Claims other than those in the cases specified in Clause 2 of this Article shall be eligible for refund before inspection

4. The Minister of Finance shall elaborate this Article.

Thus, tax refund applications are classified into 2 types as follows:

- Applications subject to inspection before refund;

- Applications subject to refund before inspection.