What is a tax accounting unit? When does the tax accounting period start in Vietnam?

What is a tax accounting unit?

Based on Clause 4, Article 3 of Circular 111/2021/TT-BTC, the regulations are as follows:

Interpretation of Terms

In this Circular, the following terms are understood as follows:

1. Tax includes taxes and other collections belonging to the state budget managed and collected by the tax authority as regulated in Clauses 1 and 2, Article 3 of the Law on Tax Administration.

2. Tax accounting is the activity carried out by tax authorities at all levels to collect, record, and reflect the entire arising tax amounts that the tax authority is required to collect, has collected, is yet to collect, needs to refund, has refunded, is yet to refund, exempt, reduce, defer debt, or write off debt in the course of implementing tax management operations.

3. Tax management operations are the tax management activities conducted by tax authorities at all levels according to their functions, tasks, authorities, and in accordance with the Law on Tax Administration, Tax Laws, related legal regulations, and tax management procedures issued by the General Director of the General Department of Taxation.

4. The tax accounting unit is the General Department of Taxation, Department of Taxation, Regional Tax Branch, Tax Branch.

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Thus, referring to the regulation above, the tax accounting units are agencies such as the General Department of Taxation, Department of Taxation, Regional Tax Branch, Tax Branch.

When does the tax accounting period start in Vietnam?

Based on Article 8 of Circular 111/2021/TT-BTC, the regulations are as follows:

Tax Accounting Period

1. The tax accounting period is determined according to the calendar year, known as the accounting year, comprising 4 characters, specifically:

a) The tax accounting period is calculated from the start of January 1 to the end of December 31 of the calendar year.

b) The first tax accounting period for a newly established tax accounting unit is determined from the effective date of the establishment, division, separation, consolidation, or merger decision of the tax accounting unit to the end of December 31 of the calendar year.

c) The final tax accounting period of a tax accounting unit when it is divided, separated, consolidated, merged, or dissolved is calculated from the start of January 1 of the calendar year to the end of the day before the effective date of the decision to divide, separate, consolidate, merge, or dissolve the tax accounting unit.

d) The duration of the first and last tax accounting period is implemented in accordance with the guidance of the Accounting Law and relevant guiding documents.

2. Accounting Principles Per Period

a) The accounting date of tax accounting is determined as the date for recording entries in the tax accounting books into the Tax Accounting Subsystem.

b) The date for collecting input information of tax accounting must ensure the principle of immediately on the date the tax management operation arises or at the latest on the following day. Except for official holidays, the information collection date is the next working day.

c) In the case of adjustments arising during the preparation of tax accounting reports regarding tax management operations already accounted for in the tax accounting period of the previous year, if adjustments are made before the closure of the tax accounting period, they are accounted into the tax accounting period of the previous year and determined by the accounting year information stipulated in Clause 1 of this Article.

d) After the tax accounting period closure, adjusting figures for the tax accounting period of the previous year can only be done upon request from a competent state agency and as regulated in Clause 3, Clause 4, Article 27 and Clause 2, Clause 3, Article 30 of this Circular.

3. Opening and Closing the Tax Accounting Period

a) Opening a tax accounting period involves setting an open status on the Tax Accounting Subsystem from the beginning of the tax accounting period stated in Clause 1 of this Article for a tax accounting period to input tax accounting data, update tax accounting documents, record accounting book entries, or edit/delete data in the tax accounting books of the Tax Accounting Subsystem.

b) Closing a tax accounting period involves setting a closed status on the Tax Accounting Subsystem for a tax accounting period to prevent inputting of tax accounting data, updating of tax accounting documents, and editing/deleting data in the tax accounting books of the Tax Accounting Subsystem.

c) The closing date of a tax accounting period is the last day of the third month from the end of the accounting period. If this coincides with an official holiday, the closing date is the next working day. If due to objective reasons, the closing date needs to be postponed, approval from the General Department of Taxation is required.

From the end of the tax accounting period to the closing date, all tax accounting adjustments are recorded according to the accounting year information outlined in Clauses 1 and 2 of this Article.

From the closing date until before the tax accounting report is approved by a competent authority, the tax authority is only allowed to adjust accounting year data at the request of the competent authority or adjust figures if the tax authority discovers errors, provided that it has the approval of the General Department of Taxation and is recorded according to the accounting year information outlined in Clauses 1 and 2 of this Article.

d) Cases of accounting data errors not adjusted into the tax accounting period in accordance with the accounting year information above should be recorded into the tax accounting period of the current year, adding "01" as the budget year information to serve as the basis for explanation on the current year's tax accounting report.

Thus, referring to the above regulations, the tax accounting period is calculated from the start of January 1 to the end of December 31 of the calendar year.

What is a tax accounting unit? When does the tax accounting period start in Vietnam? (Image from Internet)

What is the purpose of a tax accounting report in Vietnam?

Based on Article 29 of Circular 111/2021/TT-BTC, the regulations are as follows:

Tax Accounting Report

1. A tax accounting report is for summarizing the situation and results of tax management operations of tax authorities at all levels within a tax accounting period.

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Thus, referring to the above regulations, the tax accounting report is to summarize the situation and results of tax management operations of tax authorities at all levels.