What is the deadline for submitting the licensing fee declaration for new enterprises in Vietnam in 2024?

What is the deadline for submitting the licensing fee declaration for new enterprises in Vietnam in 2024?

Pursuant to Clause 1, Article 10 of Decree 126/2020/ND-CP, the deadline for submitting the licensing fee declaration is stipulated as follows:

Deadline for submitting tax declarations for land taxes, licensing fees, registration fees, licensing fees, and other collections as per the laws on public asset management and use

Taxpayers are required to comply with the tax declaration submission deadlines as prescribed in Article 44 of the Law on Tax Administration. Regarding the deadline for submitting declarations for land taxes, licensing fees, registration fees, licensing fees, and other collections under the laws on public asset management and use, as outlined in Clause 5, Article 44 of the Law on Tax Administration, it is implemented as follows:

1. licensing fee

a) Newly established licensing fee payers (excluding business households and personal businesses) (including small and medium-sized enterprises transitioned from business households) or entities establishing additional dependent units, business locations, or starting production and business activities are required to file the licensing fee declaration no later than January 30 of the year following the year of establishment or start of production and business activities.

In case there are changes in capital during the year, licensing fee payers must submit the licensing fee declaration no later than January 30 of the year following the year the information changes occur.

b) Business households and individuals are not required to file a licensing fee declaration. The tax authority bases on tax declaration dossiers and the tax management database to determine the revenue as a basis for calculating the licensing fee amount payable and notifying the licensing fee payer to comply with the regulations at Article 13 of this Decree.

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Thus, for new enterprises in 2024, the latest deadline for submitting the licensing fee declaration dossier is January 30, 2025.

What is the deadline for submitting the licensing fee declaration for new enterprises in Vietnam in 2024? (Image from the Internet)

Which entities are licensing fee payers in Vietnam?

According to Article 2 of Decree 139/2016/ND-CP, licensing fee payers include organizations and individuals engaged in production and business of goods and services, except for cases specified in Article 3 of Decree 139/2016/ND-CP, including:

- Enterprises established according to law provisions.

- Organizations established under the Law on Cooperatives.

- Public service providers established according to law provisions.

- Economic organizations of political organizations, socio-political organizations, social organizations, socio-professional organizations, and people's armed forces units.

- Other organizations engaged in production and business activities.

- Branches, representative offices, and business locations of organizations specified in clauses 1, 2, 3, 4, and 5, Article 2 of Decree 139/2016/ND-CP (if any).

- Individuals, groups of individuals, households engaged in production and business activities.

What is the rate of the licensing fee in Vietnam?

According to Article 4 of Decree 139/2016/ND-CP, amended and supplemented by Clause 2, Article 1 of Decree 22/2020/ND-CP, the rates of licensing fees are stipulated as follows:

(1) The rates of licensing fees for organizations engaged in the production and trading of goods and services are as follows:

- Organizations with charter capital or investment capital over VND 10 billion: VND 3,000,000/year;

- Organizations with charter capital or investment capital of VND 10 billion or less: VND 2,000,000/year;

- Branches, representative offices, business locations, public service providers, other economic organizations: VND 1,000,000/year.

The licensing fee rate for organizations with charter capital or investment capital over VND 10 billion and organizations with charter capital or investment capital of VND 10 billion or less is based on the charter capital recorded in the business registration certificate; in the absence of charter capital, it is based on the investment capital recorded in the investment registration certificate.

(2) The rates of licensing fees for individuals, households engaged in the production and trading of goods and services are as follows:

- Individuals, groups of individuals, households with revenue over VND 500 million/year: VND 1,000,000/year;

- Individuals, groups of individuals, households with revenue over VND 300 to 500 million/year: VND 500,000/year;

- Individuals, groups of individuals, households with revenue over VND 100 to 300 million/year: VND 300,000/year.

- Revenue as the basis for determining the licensing fee for individuals, groups of individuals, households is guided by the Ministry of Finance.

(3) Small and medium-sized enterprises converted from business households (including branches, representative offices, business locations) upon the expiration of the licensing fee exemption period (the fourth year from the year of enterprise establishment): if the period ends within the first 6 months of the year, the full year's licensing fee is payable; if it ends within the last 6 months of the year, 50% of the full year's licensing fee is payable.

Households, individuals, groups of individuals engaged in production and business that have dissolved and resumed production and business activities within the first 6 months of the year shall pay the full year's licensing fee, and 50% of the full year's licensing fee if resuming in the last 6 months of the year.

Note:

- Organizations with charter capital or investment capital over VND 10 billion and those with charter capital or investment capital from VND 10 billion or less that change their charter capital or investment capital are based on the charter capital or investment capital of the preceding year for determining the licensing fee rate.

If the charter capital or investment capital recorded in the business registration certificate or investment registration certificate is in foreign currency, it must be converted to Vietnamese dong to determine the licensing fee rate based on the buying exchange rate of the commercial bank or credit institution where the licensing fee payer has an account at the time of payment to the state budget.

- License fee payers, who are operational, must submit a document to the direct tax authority regarding the temporary suspension of production and business activities within the calendar year, are not required to pay the licensing fee for the business suspension year provided that the request for suspension document is submitted to the tax authority before the license fee payment deadline (January 30 annually) and they have not yet paid the licensing fee for the suspension year.

In the case of non-compliance with the aforementioned conditions for temporary suspension of production and business activities, the full-year licensing fee must be paid.