What are the penalties for violations against regulations on time limits for submission of tax returns in Vietnam?

Regarding this matter, LawNet would like to answer as follows:

1. Deadline for submitting tax declaration documents in Vietnam

According to Clause 1, Article 7 of Decree 126/2020/ND-CP, a tax declaration dossier consists of the tax return and documents that are the basis for determination of the taxpayer’s tax obligations, is prepared and sent by the taxpayer to the tax authority. A tax declaration dossier can be electronic or physical.

According to Article 44 of the Law on Tax Administration 2019, the deadlines for submission of tax declaration dossiers are as follows:

- Deadlines for submission of tax declaration dossiers of taxes declared monthly and quarterly:

+ For taxes declared monthly: the 20th of the month succeeding the month in which tax is incurred;

+ For taxes declared quarterly: the last day of the first month of the succeeding quarter.

- For taxes declared annually:

+ For annual tax statement dossiers: the last day of the 3rd month from the end of the calendar year or fiscal year. For annual tax declaration dossiers: the last day of the first month from the end of the calendar year or fiscal year

+ For annual personal income tax statements prepared by income earners: the last day of the 4th month from the end of the calendar year;

+ For presumptive tax declarations prepared by household businesses and individual businesses: the 15th of December of the preceding year. For new household businesses and individual businesses: within 10 days from the date of commencement of the business.

- For declaration of taxes that are declared and paid upon incurrence: the 10th day from the day on which tax is incurred.

- For tax declaration dossiers upon shutdown, contract termination, business conversion or business re-arrangement: the 45th day from the occurrence of the event.

Note:

- The Government shall specify the deadlines for submission of statements of farming land levies, non-farming land levies; land levies; land rents, water surface rents; mineral extraction licensing fee; water resource extraction licensing fee; registration fee; licensing fees; other amounts payable to state budget in accordance with regulations of law on management and use of public property; multinational profit reports.

- Deadlines for submission of customs dossiers of exports and imports are specified by the Law on Customs.

- In case a taxpayer declares tax electronically on the last day of the time limit for declaration and the information portal of the tax authority is not functional, the taxpayer may submits the electronic declaration on the next day after the online portal is functional again.

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

Pursuant to Article 13 of Decree 125/2020/ND-CP, penalties for violations against regulations on time limits for 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.

In case where the fine amount prescribed in this clause 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 prescribed in clause 4 of Article 13 of Decree 125/2020/ND-CP.

- Remedies:

+ Compelling the full payment of deferred tax amounts into the state budget with respect to the commission of violations against regulations on time limits for submission of tax returns if the taxpayer delays filing their tax return, leading to the late payment of taxes;

+ Compelling the submission of tax returns, enclosing annexes, in case of committing the following acts:

++ 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.

Thus, the penalties for violations against regulations on time limits for submission of tax returns ranges from a warning to the highest fine of up to 25,000,000 VND. In addition, the offenders are subject to remedies such as: compelling the full payment of deferred tax amounts into the state budget; compelling the submission of tax returns, enclosing annexes

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