Vietnam: During the suspension of business activities, what should business individuals not do?
- Business individuals, who are not subject to business registration, do have to notify the tax authorities when suspending business activities in Vietnam?
- During the shutdown, what are business individuals not allowed to do in Vietnam?
- Based on determining the time when a business individual is not subject to business registration or suspension of operation, how is it regulated in Vietnam?
Business individuals, who are not subject to business registration, do have to notify the tax authorities when suspending business activities in Vietnam?
According to the provisions of Clause 2, Article 37 of the Vietnam Law on Tax Administration 2019, the contents of the notice of suspension of business activities are as follows:
Article 37. Notification of suspension of operation/business
1. When organizations, household and individual businesses subject to business registration suspend from operation/business within a fixed period of time or continue to operate/do business before the notified time as prescribed in the Vietnam Law on Enterprises and other relevant regulations, tax authorities shall conduct tax administration based on notifications from taxpayers or state authorities during the operation/business suspension or during the continuation of operation/business of the taxpayers as prescribed in this Vietnam Law.
2. Organizations, household and individuals businesses not required to apply for business registration shall notify their supervisory tax authorities in no later than 01 working day before suspending operation/business or resumption of operation/business ahead of schedule.
Accordingly, business individuals who are not subject to business registration when suspending their operations or doing business shall notify the directly managing tax authority at least 01 working day before suspending their operations, doing business or continuing operations and business before the notified time limit to perform tax administration.
In addition, according to the provisions of Clause 3 Article 4 of Decree 126/2020/ND-CP, in case a business individual continues to operate or resumes business on time as registered, he/she does not have to notify the tax authority where he/she has registered to suspend his/her operation or business as prescribed.
Business individuals shall notify the directly managing tax authority at least 01 working day before resuming operations and doing business before the deadline.
Vietnam: During the suspension of business activities, what should business individuals not do?
During the shutdown, what are business individuals not allowed to do in Vietnam?
Pursuant to Clause 2 Article 4 of Decree 126/2020/ND-CP on this content as follows:
- The taxpayer is not required to submit tax declaration dossiers, unless the suspension begins in the middle of a monthly/quarterly/annual tax period, in which case the tax declaration dossier of that month/quarter/year must be submitted.
- For household businesses and individual businesses paying presumptive tax, tax authorities shall decide the tax payable upon their suspension in accordance with regulations of the Minister of Finance.
- The taxpayer must not use invoices and are not required to submit invoice use reports. In case the taxpayer is permitted by the tax authority to use invoices in accordance with invoice Vietnam Laws, the taxpayer shall submit the tax declaration dossier and invoice use reports as per regulations.
- The taxpayer shall implement the tax authority’s decisions and notices of debt collection, enforcement of tax decisions, inspection of compliance to tax Vietnam Laws and administrative penalties for tax offences in accordance with the Vietnam Law on Tax administration.
Based on determining the time when a business individual is not subject to business registration or suspension of operation, how is it regulated in Vietnam?
According to the provisions of Clause 1 Article 4 of Decree 126/2020/ND-CP on this content as follows:
Article 4. Tax administration during taxpayer’s business suspension
The taxpayer shall send a business suspension notice in accordance with Article 37 of the Vietnam Law on Tax administration and the following regulations:
1. Business suspension time:
a) If the taxpayer applies for taxpayer registration together with enterprise/cooperative/business registration as prescribed in Clause 1 Article 37 of the Vietnam Law on Tax administration, the business suspension time is also the suspension time of the enterprise/cooperative recorded by the business registration authority on National Enterprise Registration Information System. The business registration authority shall send electronic information about the suspension to the tax authority within 01 working day or the next working day from the day on which such information is recorded on the National Enterprise Registration Information System by the business registration authority.
b) In case the business suspension is accepted, notified or requested by a competent authority as prescribed in Clause 1 Article 37 of the Vietnam Law on Tax administration, the business suspension time will be that written on the document issued by such competent authority, which will be sent by the issuing authority to the supervisory tax authority of the taxpayer within 03 working days from its issuance date.
c) If the taxpayer is an organization, household business or individual business that is not required to apply for business registration as prescribed in Clause 2 Article 37 of the Vietnam Law on Tax administration, the business suspension notice shall be sent to the supervisory tax authority at least 01 working day before the suspension date. The tax authority shall send a confirmation to the taxpayer within 02 working days from the day on which the taxpayer’s notice is received. The duration of business suspension must not exceed 1 year per notice. If the taxpayer is an organization, the total duration of business suspension must not exceed 2 years for 2 consecutive notices.
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Accordingly, business individuals who are not subject to business registration shall notify the suspension of operation and business to the directly managing tax authority at least 01 working day before suspending operations and business.
The tax authority shall send a confirmation notice to the taxpayer who is a business individual about the time to register for suspension of operation and business within 02 working days from the date of receipt of the taxpayer's notice.
Business individuals may suspend their operations and business for no more than 1 year for 1 registration.
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