When should household businesses and individual businesses submit tax declaration dossiers in Vietnam?

Vietnam: What does tax declaration dossier for household businesses include?

According to Clause 2, Article 13 of Circular 40/2021/TT-BTC stipulating the tax declaration dossier for household businesses as follows:

- From November 20 to December 5 annually, the tax authority distributes the tax declaration form for the next year to all household businesses.

- The tax declaration dossier for household businesses as specified in Section 8.1, Appendix I - List of tax declaration dossiers issued together with Decree 126/2020/ND-CP is a tax declaration form for household businesses and individual businesses in accordance with Form No. 01/CNKD issued together with Circular 40/2021/TT-BTC.

- In the case where a household business uses invoices issued by the tax authority, retailing each time an occurrence arises, the household business declares taxes for revenue on the retail invoice on a per-occurrence basis using the tax declaration form for household businesses, individual businesses in accordance with Form No. 01/CNKD issued together with Circular 40/2021/TT-BTC while presenting and submitting along with the tax declaration dossier the following documents:

+ Copy of economic contract for the supply of goods and services in the same line of business of the household business;

+ Copy of the acceptance and liquidation certificate of the contract;

+ Copies of documents proving the origin of goods and services such as:

++ List of agricultural products procurement if the goods are domestic agricultural products;

++ List of goods purchased and exchanged by border residents if the goods are imported by border residents;

++ Invoice from the seller if the goods are imported and purchased from an organization or individual business in the country;

++ Relevant documents to prove if the goods are self-produced and supplied by an individual; ...

The tax authority has the right to request the presentation of the originals for comparison and confirmation of the accuracy of the copies with the originals.

When should household businesses and individual businesses submit tax declaration dossiers in Vietnam? (Image from the Internet)

When should household businesses and individual businesses submit tax declaration dossiers in Vietnam?

Household businesses and individual businesses comply with the regulations at Article 13 of Circular 40/2021/TT-BTC specifically regarding the deadline for submitting tax declaration dossiers as follows:

- The deadline for submitting tax declaration dossiers for household businesses is no later than December 15 of the preceding year of the tax year.

- In cases where a new household business starts operations (including those switching to the presumptive tax method), or where a household business switches to the self-assessment method, or where a household business changes its line of business or business scale within the year, the deadline for submitting tax declaration dossiers is no later than 10 days from the commencement date of business, or from the date of changing the tax calculation method, line of business, or business scale.

- The deadline for submitting tax declaration dossiers in cases where a household business uses invoices issued by the tax authority, retailing each time an occurrence arises, is no later than 10 days from the date of revenue generation that requires the use of invoices.

Additionally, according to point b, Clause 8, Article 13 of Circular 40/2021/TT-BTC, based on the tax payment notice, the household business pays value-added tax (VAT), and personal income tax (PIT) according to the deadline on the notice.

In cases where a household business uses invoices issued by the tax authority for retailing each time an occurrence arises, the tax payment deadline for the revenue on the invoice is the deadline for tax declaration for revenue on the invoice as guided in point c, clause 3, Article 13 of Circular 40/2021/TT-BTC.

Newly established household businesses within the year (operating for less than 12 months within the calendar year) are subject to paying VAT and PIT if the annual revenue exceeds VND 100 million; if the revenue is below VND 100 million, no tax obligation arises.

How to calculate the presumptive tax rate in Vietnam?

According to Clause 4, Article 13 of Circular 40/2021/TT-BTC stipulating the presumptive tax rate as follows:

- Revenue and the presumptive tax rate are calculated on a calendar year or month basis for seasonal and stable business operations within one year.

- Household businesses self-determine the revenue subject to presumptive tax in the year in the tax declaration form according to Form No. 01/CNKD. In cases where the household business cannot determine the presumptive revenue, does not submit a tax declaration dossier, or declares a revenue inconsistent with the actual business activities, the tax authority shall impose the revenue and determine the presumptive tax rate according to the provisions of Article 51 of the Law on Tax Administration 2019.

- Based on the tax declaration dossier of the household business and the tax authority's database to seek public opinions, consult the Tax Advisory Council, providing a basis for the Tax Department to direct and review the creation of the tax book in each Tax Sub-Department.

Additionally, according to Clause 1, Article 13 of Circular 40/2021/TT-BTC, the presumptive tax is calculated based on the following grounds:

- The tax declaration dossier of the household business self-declared based on projected revenue and presumptive tax rate for the tax year.

- The tax authority's database.

- Consultation from the commune-level tax advisory council.

- The public disclosure of information and reception of feedback from the commune-level tax advisory council, People's Committee, People's Council, Fatherland Front, household businesses, and other organizations and individuals.

Thus, the presumptive tax rate is based on the results of two public disclosures, the information in the tax declaration dossier of the household business, the tax authority's database, and the consultation from the commune-level tax advisory council.

Household businesses are allowed to self-determine the revenue subject to tax; in cases where they cannot self-determine it or do not declare taxes or the tax declaration is not consistent, the tax authority will impose the revenue and determine the presumptive tax rate for the household business.