What are the conditions for personal income tax refund in Vietnam in 2025?

What are the conditions for personal income tax refund in Vietnam in 2025?

Based on Article 28 of Circular 111/2013/TT-BTC, the conditions for an individual to obtain a personal income tax refund include:

- The individual has registered and holds a tax identification number at the time of submitting the tax finalization documentation.

- For individuals who have authorized a tax finalization to be done by the income-paying organization or individual:

+ The tax refund for the individual is processed through the income-paying organization or individual.

+ The income-paying organization or individual will offset any excess or shortage in tax payments for the individuals.

+ After offsetting, if there is an excess tax payment, it can be offset against the next period's taxes or refunded if requested.

- A refund request must be submitted to the tax authority using the prescribed form and be approved.

- Individuals filing directly with the tax authority may choose to have a refund or an offset against the next period with the same tax authority.

- In cases where individuals qualify for a personal income tax refund but delay the submission of the tax finalization declaration as required, no penalties will be applied for administrative violations due to late tax finalization submissions.

What are the conditions for obtaining a personal income tax refund in Vietnam in 2025? (Image from the Internet)

When is a personal income tax refund not allowed in Vietnam?

Under Clause 3, Article 60 of the Law on Tax Administration 2019, it is stipulated that the overpaid personal income tax amount that cannot be refunded and is liquidated by the tax management agency on the accounting ledger and electronic data system occurs in the following circumstances:

- The tax management agency has informed the taxpayer of the refundable overpaid tax amount, but the taxpayer refuses to accept the refund in writing.

- The taxpayer is no longer operating at the registered address with the tax authority and has been informed by the tax management agency of the overpaid amount through public media, but within one year from the notification date, the taxpayer does not issue a written response requesting the refund of the overpaid tax amount.

- The overpaid amount has exceeded the 10-year period from the date of payment into the state budget, and the taxpayer has not offset tax obligations or claimed a refund.

What are procedures for the personal income tax refund for employees in Vietnam?

According to Article 2 of the process issued with Decision 679/QD-TCT 2023, the stipulations include:

Content of the process

The tax refund process includes the following content:

1. Receipt of the refund request dossier, as regulated in Articles 32 and 43 of Circular No. 80/2021/TT-BTC dated September 29, 2021, by the Ministry of Finance guiding the implementation of certain provisions of the Law on Tax Administration and Decree No. 126/2020/ND-CP dated October 19, 2022, by the Government of Vietnam detailing certain provisions of the Law on Tax Administration (hereinafter referred to as Circular No. 80/2021/TT-BTC) for cases:

...

d) Personal income tax refund for individuals directly finalizing tax with tax authorities: Tax refund dossier for cases where an individual with income from salaries and wages directly finalizes tax with tax authorities as stipulated in Point b, Clause 1, Article 42 of Circular No. 80/2021/TT-BTC.

đ) Other overpayment refunds:

- The dossier of overpayment refund for other types of taxes and fees as stipulated in Clause 2, Article 42 of Circular No. 80/2021/TT-BTC.

- The personal income tax refund dossier for income from salaries paid by organizations or individuals completing tax finalization for individuals with authorized payment as stipulated in Point a, Clause 1, Article 42 of Circular No. 80/2021/TT-BTC.

2. Classification of the refund dossier according to regulations in Articles 33 and 44 of Circular No. 80/2021/TT-BTC:

3. Processing of the refund dossier according to regulations in Articles 34 and 45 of Circular No. 80/2021/TT-BTC:

a) Processing the refund dossier entitled to a prior refund.

b) Processing the refund dossier subject to prior inspection before refunding.

4. Appraisal of the refund dossier: Appraisal for dossiers subject to appraisal as regulated in the Regulations on Legal Opinions for Draft Proposals for the Development of Normative Legal Documents, Draft Normative Legal Documents, and Appraisal of Draft Administrative Documents issued by tax authorities at all levels according to Decision No. 1033/QD-TCT dated June 1, 2018, by the General Director of the General Department of Taxation and any replacing, amending, or supplementing documents (if any).

5. Tax refund decision:

a) Issuance of Tax Refund Decision or Tax Refund cum Offset Decision to the state budget, Notification of Non-refundable Decision (as regulated in Articles 36 and 46 of Circular No. 80/2021/TT-BTC).

b) Issuance of Payment Decision to the bank acting as an agent for value-added tax refund according to Article 36 of Circular No. 80/2021/TT-BTC, Article 21 of Circular No. 72/2014/TT-BTC dated May 30, 2014, by the Ministry of Finance amended, supplemented in Clause 15, Article 1 of Circular No. 92/2019/TT-BTC dated December 31, 2019, by the Ministry of Finance for tax refund to banks acting as agents.

6. Issuance of an Order to Refund State Budget Revenue or Refund cum Offset Order to State Budget Revenue according to the regulations on implementing policies on state budget accounting and treasury operations.

7. Retrieval of tax refunds according to regulations in Articles 40 and 50 of Circular No. 80/2021/TT-BTC.

Thus, the personal income tax refund process consists of the following steps:

(1) Receipt of the refund request dossier

(2) Classification of the refund dossier

(3) Processing of the refund dossier

(4) Appraisal of the refund dossier

(5) Tax refund decision