Vietnam: Is it required to submit tax return if there is no deduction of personal income tax?

Hello, Lawnet would like to answer the following:

1. Is it required to submit tax return if there is no deduction of personal income tax?

According to Clause 3, Article 7 of Decree 126/2020/ND-CP, a taxpayer is not required to declare tax in the following cases:

- The taxpayer only has business operations that are not subject to any tax.

- The taxpayer is an individual earning tax-free income as prescribed by personal income tax laws and Point b Clause 2 Article 79 of the Law on Tax administration, except individuals that receive real estate as inheritance or gift and individuals that transfer real estate.

- An enterprise that only exports is not required to declare VAT.

- The taxpayer’s business suspension is suspended as prescribed in Article 4 of this Decree.

- The taxpayer applies for TIN invalidation, except termination of business operation, contract or business rearrangement prescribed in Clause 4 Article 44 of the Law on Tax administration.

Thus, according to the above regulations, taxpayers are not required to submit tax returns for these 5 cases.

In addition, Decree 91/2022/ND-CP, effective from October 30, 2022, also stipulates more cases where taxpayers are not required to submit tax returns as follows:

“The declarant of personal income tax is the income payer, declares personal income tax monthly or quarterly, and does not deduct personal income tax in the same month or quarter."

Thus, from October 30, 2022, if there is no deduction of personal income tax in the month or quarter of the recipient, the organization or individual paying income according to the regulations on monthly and quarterly tax declaration will do not have to file personal income tax returns in that month or quarter.

2. What is the penalties for violations against regulations on time limits for submission of tax returns?

Enterprises that are late in tax returns will be administratively sanctioned according to Article 13 of Decree 125/2020/ND-CP as follows:

Thus, the administrative fines for late submission of tax returns are as follows:

- Penalties imposed in form of cautions shall be imposed for violations arising from filing tax returns from 01 to 05 days after expiration of the prescribed time limits under mitigating circumstances.

- Fines ranging from VND 2,000,000 to VND 5,000,000 shall be imposed for the act of submitting tax returns from 01 to 30 days after expiration of the prescribed time limits, except the cases specified in clause 1 of this Article.

- Fines ranging from VND 5,000,000 to VND 8,000,000 shall be imposed for the act of submitting tax returns from 31 to 60 days after expiration of the prescribed time limits.

- Fines ranging from VND 8,000,000 to VND 15,000,000 shall be imposed for one of the following violations:

+ Filing tax returns from 61 to 90 days after expiration of the prescribed time limits;

+ Filing tax returns at least 91 days after expiration of the prescribed time limits if none of additional taxes is incurred;

+ Failing to submit tax returns if none of additional taxes is incurred;

+ Failing to submit annexes under regulations regarding tax administration by enterprises having related-party transactions, enclosing CIT finalization dossiers.

- Fines ranging from VND 15,000,000 to VND 25,000,000 shall be imposed for the act of filing tax returns more than 90 days after the prescribed deadline if such act results in additional taxes to be paid, and the taxpayer has fully paid taxes, deferred amounts into the state budget before the time of the tax authority’s announcement of the decision on tax inspection and examination, or before the time of the tax authority’s issuance of the report on the deferred submission of tax returns under the provisions of clause 11 of Article 143 in the Law on Tax Administration.

Note:

- The above fine level is the fine level applied to the violating organization. For the same act of administrative violation, the fine level for organizations is equal to 02 times the fine level for individuals.

- In case where the fine amount above is greater than the tax amount additionally incurred in the tax return, the maximum amount of fine for this act shall be equal to the tax amount payable specified in the tax return and shall not be less than the average of fine amounts in the range above

- In case the violation is committed before December 5, 2020 but the violation ends from December 5, 2020, the provisions of the legal document on sanctioning of administrative violations shall apply. tax regulations, invoices in effect at the time of committing such violations.

Best regards!

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