What are the responsibilities of taxpayers when declaring VAT quarterly in Vietnam?

What are the responsibilities of taxpayers when declaring VAT quarterly in Vietnam?

According to Clause 2, Article 9 of Decree 126/2020/ND-CP, the regulations are as follows:

Criteria for quarterly tax declaration for value-added tax and personal income tax

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2. Taxpayers are responsible for determining if they qualify for quarterly tax declaration to comply with the regulations.

a) Taxpayers who meet the criteria for quarterly tax declaration may choose to declare taxes monthly or quarterly consistently throughout the calendar year.

b) In cases where taxpayers who are declaring taxes monthly qualify for quarterly declaration and choose to switch to quarterly declaration, they must submit a request as stipulated in Annex I attached to this Decree to change the tax calculation period to the directly managing tax authority no later than January 31 of the year they begin quarterly declaration. If taxpayers do not send the request by this deadline, they must continue with monthly declarations consistently throughout the calendar year.

c) If taxpayers discover they do not meet the criteria for quarterly tax declaration, they must switch to monthly tax declarations starting from the first month of the following quarter. They are not required to resubmit monthly tax declaration files for previous quarters, but must submit a Statement of Additional Tax Amounts Due based on monthly calculations versus quarterly calculations as stipulated in Annex I of this Decree and account for delayed payment fees as per regulations.

d) If a tax authority discovers that a taxpayer does not qualify for quarterly tax declaration, the authority must recalculate the additional tax amount due on a monthly basis compared to what the taxpayer declared and account for delayed payment fees as per regulations. Taxpayers must commence monthly tax declarations upon receiving written notice from the tax authority.

Thus, to comply with quarterly VAT declarations, taxpayers are responsible for determining whether they qualify for quarterly declarations to fulfill tax obligations as required.

Responsibilities of taxpayers when declaring VAT quarterly in Vietnam (Image from the Internet)

What are the requirements for VAT declaration documents in Vietnam?

Based on Clause 1, Article 7 of Decree 126/2020/ND-CP, the VAT declaration documents are defined as follows:

- A tax declaration dossier consists of the tax return and all related documents and evidence used to determine the taxpayer's obligations to the state budget, compiled and submitted electronically or in paper form to the tax authority by the taxpayer. Taxpayers must accurately fill out the tax return, schedules, and appendices (if applicable) according to the templates prescribed by the Minister of Finance and are responsible before the law for the accuracy, truthfulness, and completeness of all information in the tax return, schedules, and appendices; and submit all required documents as specified in the tax declaration dossier to the tax authority. For certain documents related to the tax declaration dossier not issued by the Ministry of Finance but governed by another legal regulation, the templates set forth by related laws shall be followed.

In addition, taxpayers shall base on the tax declaration dossier and supplemental declarations to self-calculate the amount of tax payable, additional tax payable, and late payment fees (if any) for submission to the state budget following regulations (except where specified in Article 13 of Decree 126/2020/ND-CP). The tax authority is tasked with determining taxes as per Articles 50 and 52 of the Tax Administration Law 2019 should it find the taxpayer has incorrectly or incompletely declared tax calculation data in the tax declaration dossier.

- The tax authority will calculate the tax amount payable and notify the taxpayer in accordance with Article 13 of Decree 126/2020/ND-CP, based on the taxpayer's tax declaration dossier, information from relevant state authorities, and tax management information.

- Tax authorities will determine the presumptive tax level based on the tax declarations of business households and individuals using a flat-rate method and relevant tax management information.

What are the criteria for quarterly VAT declaration in Vietnam?

The criteria for quarterly tax declaration related to value-added tax and personal income tax are delineated in Clause 1, Article 9 of Decree 126/2020/ND-CP as follows:

Quarterly VAT declaration applies to:

- Taxpayers eligible for monthly VAT declaration under point a, clause 1 of Article 8 in Decree 126/2020/ND-CP whose total sales revenue of goods and services from the preceding calendar year does not exceed 50 billion VND may declare VAT quarterly.

+ Sales revenue is determined as the total revenue on the VAT declaration forms for each tax period within the calendar year.

+ If the taxpayer conducts centralized tax declarations at the head office for subsidiaries or business locations, sales revenue also encompasses the revenue from these subsidiaries or locations.

- New taxpayers beginning operations can choose to declare VAT quarterly. After operating for a full 12 months, the following calendar year's declarations will be based on the revenue of the preceding full 12-month year and determine whether VAT is declared monthly or quarterly for the subsequent periods.