When is the classification of overall risk level for taxpayers in Vietnam?

When is the classification of overall risk level for taxpayers in Vietnam?

According to Point b, Clause 2, Article 8 of the Procedure issued together with Decision 18/QD-TCT of 2023 as follows:

Evaluation of tax compliance and classification of taxpayer risk level

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b) Step 2 - Classifying the overall risk level of the taxpayer.

b1) Classification timing.

The classification of overall risk level for taxpayers is conducted on April 15, June 30, September 30 annually or according to management requirements.

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The classification of the overall risk level for taxpayers is conducted on April 15, June 30, September 30 annually.

In addition, the classification of the overall risk level for taxpayers is also carried out upon management's request.

When is the classification of overall risk level for taxpayers in Vietnam? (Image from the Internet)

What are the principles for classification of overall risk level for taxpayers in Vietnam?

Based on Clause 1, Article 8 of the Procedure issued together with Decision 18/QD-TCT of 2023, the overall risk classification for taxpayers is conducted based on the following principles:

- The evaluation of taxpayer tax compliance and risk classification is automatically conducted using information technology applications, based on indices, criteria, and evaluation methods issued by the General Department of Taxation.

- The evaluation of tax compliance is conducted for all taxpayers.

- Depending on the tax management operation's requirements, each taxpayer segment or each taxpayer entity will be classified by the overall risk level and can be classified according to various tax management operations.

- For the classification of risk levels in tax management operations: Depending on tax management requirements to perform periodic classifications annually, either once (01) time or multiple times, such as the planning of inspections and examinations at taxpayers' headquarters; or periodically by month, quarter, and timely classification upon arising of operational records (such as tax refund operations).

- Sequential evaluation and classification procedure:

The evaluation of taxpayer tax compliance and risk classification is carried out in the following order:

First: Evaluate the taxpayer's compliance with tax laws.

Second: Classify the overall risk level of the taxpayer.

Third: Classify the risk level in specific tax management operations.

- Regarding evaluation and classification results:

Results are generated according to a form issued together with this Procedure and arranged according to the following criteria:

+ According to taxpayers' levels of tax law compliance and risk classification from high to low.

+ According to the order of criteria indices where many taxpayers violate or according to the score of each criterion from high to low.

What are procedures for evaluate tax compliance and classify taxpayer risk levels in Vietnam?

According to regulations at Clause 2, Article 8 of the Procedure issued together with Decision 18/QD-TCT of 2023 on this matter as follows:

Evaluation of tax compliance and classification of taxpayer risk level

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2. Conduct evaluation and classification.

a) Step 1 - Evaluate taxpayer compliance with tax laws.

a1) Evaluation timing: The evaluation of taxpayer compliance with tax laws is conducted periodically on the 25th of each month.

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b) Step 2 - Classify the overall risk level of the taxpayer.

b1) Classification timing.

The classification of overall risk level for taxpayers is conducted on April 15, June 30, September 30 annually or according to management requirements.

b2) Conduct classification.

B2.1 - Utilize data analysis and automated risk management applications to classify the overall risk level for taxpayers.

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c) Step 3 - Classify risk level in tax management operations.

c1) Conduct classification.

B3.1 - For operations requiring periodic classification: Use data analysis and automated risk management applications to classify risk levels in each tax management operation at periodically established times according to regulations.

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The evaluation of tax compliance and the classification of taxpayer risk levels are conducted in 3 steps:

Step 1: Evaluate the taxpayer's compliance with tax laws.

Step 2: Classify the overall risk level of the taxpayer.

Step 3: Classify the risk level in specific tax management operations.