Tax Assessment: What Is It? Procedures for Tax Assessment in Case of Violations
What is tax assessment?
According to Clause 1, Article 48 of Circular 38/2015/TT-BTC, the tax assessment is regulated as follows:
Tax Assessment
1. Tax assessment as guided in this Circular is the exercise of the customs authority's power to determine tax calculation elements, bases, and amounts, notify, and require taxpayers to pay the taxes determined by the customs authority in the cases mentioned in Clause 2 of this Article.
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Thus, according to the above regulation, tax assessment is the exercise of the customs authority's power to determine tax calculation elements, bases, and amounts, notify, and require taxpayers to pay the taxes determined by the customs authority in the cases mentioned in Clause 2 of this Article.
*What is tax assessment? What are the procedures for tax assessment regarding taxpayers in case of violation?*
What are the procedures for tax assessment regarding taxpayers in case of violation?
According to Clause 2, Article 16 of Decree 126/2020/ND-CP, the procedures are regulated as follows:
Authority, Procedures, and Decision for Tax Assessment
1. Authority for Tax Assessment
The General Director of the General Department of Taxation; the Directors of the Departments of Taxation; the Heads of District Tax Offices have the authority for tax assessment.
2. Procedures for Tax Assessment
a) When assessing tax, the tax authority must notify the taxpayer in writing about the tax assessment and issue a tax assessment decision. The tax assessment decision must clearly state the reasons for tax assessment, the bases for tax assessment, the assessed tax amount, and the deadline for tax payment.
b) In cases where the tax authority assesses tax through tax inspection or audit, the reasons for tax assessment, the bases for tax assessment, the assessed tax amount, and the deadline for tax payment must be recorded in the tax inspection or audit minutes and the tax handling decision of the tax authority.
c) In cases where taxpayers are subject to tax assessment, the tax authority shall impose administrative fines and calculate the penalties for late tax payment according to the law.
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Thus, according to the above regulation, the procedures for tax assessment regarding taxpayers in case of violation are as follows:
- When assessing tax, the tax authority must notify the taxpayer in writing about the tax assessment and issue a tax assessment decision. The tax assessment decision must clearly state the reasons for tax assessment, the bases for tax assessment, the assessed tax amount, and the deadline for tax payment.
- In cases where the tax authority assesses tax through tax inspection or audit, the reasons for tax assessment, the bases for tax assessment, the assessed tax amount, and the deadline for tax payment must be recorded in the tax inspection or audit minutes and the tax handling decision of the tax authority.
- In cases where taxpayers are subject to tax assessment, the tax authority shall impose administrative fines and calculate the penalties for late tax payment according to the law.
When does the tax authority issue a tax assessment decision?
According to Article 14 of Decree 126/2020/ND-CP, taxpayers in the following cases are subject to tax assessment by the tax authority:
- Not registering for taxpayer identification according to the regulations in Article 33 of the Law on Tax Administration 2019.
- Failing to file tax returns or filing incomplete, dishonest, or inaccurate tax returns according to the regulations in Article 42 of the Law on Tax Administration 2019.
- Failing to supplement tax documents as requested by the tax authority, or having supplemented tax documents but they are still incomplete, dishonest, or inaccurate in the bases for tax calculation to determine the payable tax.
- Failing to reflect or reflecting incompletely, dishonestly, or inaccurately data in accounting books to determine tax liability.
- Failing to present accounting books, invoices, receipts, and necessary documents related to the determination of tax calculation elements; determining the payable tax amount within the prescribed time limit or after the tax inspection or audit deadline at the taxpayer's office.
- Failing to comply with the tax inspection decision within 10 working days from the date of signing the decision, unless the inspection period is postponed according to regulations.
- Failing to comply with the tax audit decision within 15 days from the date of signing the decision, unless the audit period is postponed according to regulations.
- Buying, selling, exchanging, and recording the value of goods and services not according to normal market transaction prices.
- Buying, exchanging goods and services using illegal invoices, using illegal invoices where the goods and services are real as determined by the competent investigational, inspection, audit authorities and have been declared in revenue and tax calculation costs.
- Having signs of absconding or dispersing assets to evade tax obligations.
- Engaging in transactions that are not consistent with economic substance, not correctly reflecting actual occurrences to reduce the taxpayer's tax liability.
- Failing to comply with the obligations of declaration, determining the transfer pricing or not providing information as required by the tax management regulations regarding enterprises with related-party transactions.
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