What are amendments to regulations on accounting period in Vietnam from January 01, 2025? How is the tax accounting period calculated?
What are amendments to regulations on accounting period in Vietnam from January 01, 2025?
Based on Clause 4, Article 2 of the Law Amending the Securities Law, Accounting Law, Independent Audit Law, State Budget Law, Law on Management and Use of Public Property, Tax Administration Law, Personal Income Tax Law, National Reserve Law, Law on Handling Administrative Violations 2024 (effective from January 01, 2025) stipulating amendments and supplements to several provisions of the Accounting Law as follows:
Amendments and Supplements to Some Articles of the Accounting Law
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- Amend and supplement Clause 4, Article 12 as follows:
“4. If the first or last financial year has a period not exceeding 03 consecutive monthly accounting periods, it is permissible to consolidate with the following financial year or the preceding financial year to form one financial year; the first or last financial accounting year must not exceed 15 months.".
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Simultaneously, based on Clause 4, Article 12 of the Accounting Law 2015, the accounting period is stipulated as follows:
Accounting Period
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- If the first or last financial year has a period shorter than 90 days, it is permissible to consolidate with the following financial year or the preceding financial year to form one financial year; the first or last financial accounting year must be shorter than 15 months.
Thus, from January 01, 2025, the Law Amending the Securities Law, Accounting Law, Independent Audit Law, State Budget Law, Law on Management and Use of Public Property, Tax Administration Law, Personal Income Tax Law, National Reserve Law, Law on Handling Administrative Violations 2024 officially adjusts the regulations on determining the accounting period in cases where the first or last financial year has a period not exceeding 03 consecutive monthly accounting periods, as opposed to 90 days previously.
This adjustment aims to include months having 31 days, avoiding complications for financial periods in the second and third quarters extending to 92 days due to both July and August having 31 days.
What are amendments to regulations on accounting period in Vietnam from January 01, 2025? How is the tax accounting period calculated? (Image from Internet)
How to calculate the tax accounting period in Vietnam?
According to Clause 1, Article 8 of Circular 111/2021/TT-BTC, the tax accounting period is determined as follows:
The tax accounting period is determined by the calendar year, referred to as the fiscal year, consisting of four characters, specifically:
- The tax accounting period is calculated from the beginning of January 01 to the end of December 31 of the calendar year.
- The first tax accounting period for a newly established tax accounting unit is determined from the start of the effective date of the establishment, division, separation, merger, or consolidation decision of the tax accounting unit until the end of December 31 of the calendar year.
- The final tax accounting period for a tax accounting unit when divided, separated, merged, consolidated, or dissolved is calculated from the beginning of January 01 of the calendar year to the day before the effective date of the division, separation, merger, consolidation, or dissolution decision of the tax accounting unit.
- The duration of the first and final tax accounting years shall be implemented according to the guidance of the Accounting Law 2015 and guiding documents.
Vietnam: What does the content of tax accounting include?
Based on Article 6 of Circular 111/2021/TT-BTC, the content of tax accounting work includes the following tasks:
- Collecting input information for tax accounting, preparing tax accounting documents
+ Collecting input information for tax accounting is a task of tax accounting performed automatically by the Tax Accounting Subsystem connected with the Taxpayer Obligation Management Subsystem as stipulated in Articles 12, 13, 14, and 15 of Circular 111/2021/TT-BTC to fully determine the contents of each tax accounting account.
+ In the case of tax accounting book entries not through the input information collection process of the Tax Accounting Subsystem, the official performing tax accounting tasks shall prepare tax accounting documents as stipulated in Article 16 of Circular 111/2021/TT-BTC.
- Recording tax accounting books is a task of tax accounting performed automatically by the Tax Accounting Subsystem to record tax accounting input information and tax accounting documents specified in Clause 1, Article 6 of Circular 111/2021/TT-BTC to account tax transactions, reflecting tax management activities arising in the tax accounting period, including opening, recording, closing, and correcting tax accounting books as stipulated in Section 3, Chapter 2 of Circular 111/2021/TT-BTC.
- Preparing tax accounting reports is a task of tax accounting performed automatically by the Tax Accounting Subsystem or by the official performing tax accounting tasks to summarize tax management results of tax authorities at all levels (including taxes payable, collected, still to be collected, refundable, refunded, remaining to be refunded, exempted, reduced, debt frozen, written off) as stipulated in Section 4, Chapter 2 of Circular 111/2021/TT-BTC.
- Storing and providing tax accounting information and documents is a task of tax accounting performed in accordance with Article 9 of Circular 111/2021/TT-BTC.
