What are the debt freezing procedures in Vietnam?

What are the debt freezing procedures in Vietnam?

According to Clause 3, Article 23 Decree 126/2020/ND-CP, the debt freezing procedures is as follows:

- For cases of debt freezing as stipulated in Article 83 of the Law on Tax Administration 2019, when the complete dossier specified at Clause 1, Article 23 of Decree 126/2020/ND-CP is available, the head of the tax administration authority directly managing the taxpayer issues a decision to suspend the debt according to Form 01/KN in Appendix 3 issued together with Decree 126/2020/ND-CP for the tax debt amount at the start of the debt freezing period as stipulated in Clause 2, Article 23 of Decree 126/2020/ND-CP.

- In the event that the taxpayer, who has been issued a decision for tax debt freezing by the tax authority, has their court decision declaring them as deceased, missing, or having lost civil act capacity revoked, or the taxpayer resumes business activities, the tax authority issues a decision to terminate the effect of the tax debt freezing decision according to Form 02/KN in Appendix 3 issued together with Decree 126/2020/ND-CP.

The tax authority calculates the late payment interest for the taxpayer from the date the decision to terminate the effect of the tax debt freezing decision is issued until the taxpayer fully pays the tax debt into the state budget.

- In case the taxpayer, who has been issued a tax debt freezing decision by the tax authority, meets the conditions for debt cancellation as stipulated in Article 85 of the Law on Tax Administration 2019, the tax authority issues a decision to terminate the effect of the tax debt freezing decision according to Form 02/KN in Appendix 3 issued together with Decree 126/2020/ND-CP and carries out debt cancellation as stipulated.

- For taxpayers being individuals, individual businesspersons, household heads, household business owners, private enterprise owners, and single-member limited liability company owners who have their tax debts suspended, if the tax authority detects that the taxpayer has established other businesses, the tax authority issues a decision to terminate the effect of the tax debt freezing decision according to Form 02/KN in Appendix 3 issued together with Decree 126/2020/ND-CP and calculates the late payment interest from the date the taxpayer’s tax debt was suspended until the taxpayer fully pays the tax debt into the state budget.

What are the debt freezing procedures in Vietnam? (Image from Internet)

What is the tax debt freezing time in Vietnam?

According to Clause 2, Article 23 of Decree 126/2020/ND-CP, the tax debt freezing time is regulated as follows:

- For taxpayers specified in Clause 1, Article 83 of the Law on Tax Administration 2019, the freezing time is calculated from the date the death certificate, notice of death, or equivalent documents according to civil status regulations are issued, or from the date the court decision declaring a person as deceased, missing, or having lost civil act capacity until the court revokes the decision or the debt is cancelled as stipulated.

- For taxpayers specified in Clause 2, Article 83 of the Law on Tax Administration 2019, the freezing time is calculated from the date the business registration authority publishes information about the taxpayer undergoing dissolution procedures on the National Business Registration Information System until the taxpayer resumes business activities, completes dissolution procedures, or has their debt cancelled as stipulated.

- For taxpayers specified in Clause 3, Article 83 of the Law on Tax Administration 2019, the freezing time is calculated from the date the competent court announces acceptance of the bankruptcy request or from the date the taxpayer submits the bankruptcy file to the tax authority but is still undergoing settlement and debt handling procedures according to the Bankruptcy Law 2014 until the taxpayer resumes business activities or has their debt cancelled as stipulated.

In the case where the competent court has announced acceptance of the bankruptcy request, the taxpayer's debt is suspended for the tax debt amount remaining up to the date the court announces acceptance of the bankruptcy request.

- For taxpayers specified in Clause 4, Article 83 of the Law on Tax Administration 2019, the freezing time is calculated from the date the tax authority issues a nationwide notice that the taxpayer or their legal representative is not present at their registered business address, until the taxpayer resumes business activities or has their debt cancelled as stipulated.

- For taxpayers specified in Clause 5, Article 83 of the Law on Tax Administration 2019, the freezing time is calculated from the date the tax authority issues a written recommendation for the competent authority to revoke or from the effective date of the decision to revoke the business registration certificate, enterprise registration certificate, cooperative registration certificate, household business registration certificate, establishment and operation license, or practicing license until the taxpayer resumes business activities or has their debt cancelled as stipulated.

What cases are eligible for tax debt freezing in Vietnam?

According to Article 83 of the Law on Tax Administration 2019, the cases eligible for tax debt freezing include:

(1) The taxpayer is a person who has died, has been declared dead, missing, or having lost civil act capacity by the court.

(2) The taxpayer has a dissolution decision sent to the tax authority and business registration authority for dissolution procedures, and the business registration authority has notified that the taxpayer is undergoing dissolution procedures on the national business registration system, but the taxpayer has not completed the dissolution procedures.

(3) The taxpayer has submitted a bankruptcy request or has been subjected to a bankruptcy request by a party with related rights and obligations according to bankruptcy regulations.

(4) The taxpayer is no longer conducting business at their registered address according to the business registration or tax registration authorities, and the tax authority has cooperated with the Commune-level People's Committee where the taxpayer is headquartered or has an address to verify that the taxpayer is not present at the registered address and has published a nationwide notice that the taxpayer or their legal representative is not present at their registered address.

(5) The taxpayer has had their business registration certificate, enterprise registration certificate, cooperative registration certificate, establishment and operation license, or practicing license revoked by the competent authority or the tax authority has recommended the competent authority to revoke them.