Can a company choose to issue a single tax deduction certificate for multiple tax deductions in a tax period for individuals who do not sign a labor contract in Vietnam?

Can a company choose to issue a single tax deduction certificate for multiple tax deductions in a tax period for individuals who do not sign a labor contract in Vietnam?

Pursuant to Clause 2 Article 4 of the Decree 123/2020/NĐ-CP stipulating as follows:

2. When deducting personal income tax or collecting taxes, fees or charges, the organization responsible for tax deduction or the tax, fee or charge collector shall make and give certificates of personal income tax withholding or receipts of taxes, fees or charges to persons whose income is deducted or payers. Such records/receipts must contain adequate information as prescribed in Article 32 hereof. If electronic receipts are used, they must follow the standard format prescribed by tax authorities. If an individual authorizes tax declaration, no certificates of personal income tax withholding are issued.

If a person does not sign an employment contract or signs an employment contract for less than 03 months, the income payer is entitled to issue a certificate of personal income tax withholding for either each deduction or multiple deductions within a tax period. If a person signs an employment contract for 03 months or longer, the income payer shall issue a certificate of personal income tax withholding in a tax period.

Therefore, for individuals, employees of your company who do not sign a labor contract, the company can choose to issue a tax deduction certificate for each tax deduction or issue a single tax deduction certificate for multiple tax deductions in a tax period.

Can a company choose to issue a single tax deduction certificate for multiple tax deductions in a tax period for individuals who do not sign a labor contract in Vietnam? - Source: Internet

Is the income of non-resident individuals deductible in Vietnam?

Pursuant to Clause 1.a Article 25 of the Circular 111/2013/TT-BTC stipulating tax deduction and certificate of tax deduction as follows:

Tax deduction and certificate of tax deduction

1. Tax deduction

Tax deduction is an act of calculating and withholding the tax payable from the taxpayer’s income by the income payer before the income is paid to the tax payer.

a) Incomes earned by non-residents:

The organization or individual that pays taxable incomes to the non-resident shall withhold the personal income tax from the income before it is paid. The determination of tax being withheld is guided in Chapter III (from Article 17 to Article 33) of this Circular. 

In the event that an organization or individual pays taxable income to a non-resident individual, it must be responsible for withholding personal income tax before paying the income to the individual.

What are the contents of a tax deduction record in Vietnam?

Pursuant to Clause 1 Article 32 of the Decree 123/2020/NĐ-CP stipulating contents of records as follows:

1. A certificate of personal income tax withholding contains the following information:

a) Name, form number, reference number and ordinal number of the certificate of personal income tax withholding;

b) Name, address and TIN of the applicant;

c) Name, address and TIN of the taxpayer (if available);

d) Nationality (if the taxpayer is not a Vietnamese citizen);

dd) Taxable income, time of income payment, total taxable income, PIT amount deducted, income amounts received;

e) Date of the certificate of personal income tax withholding;

g) Full name and signature of income payer.

In case of electronic certificate of personal income tax withholding, digital signature is required.

Above are the contents of a tax deduction records in Vietnam

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