From January 01, 2025, it is prohibited to file supplementary tax returns when there is a tax audit or inspection decision in Vietnam

From January 1, 2025, is it possible to file supplementary tax returns when there is a tax audit or inspection decision in Vietnam?

Based on Clause 1, Article 47 of the Law on Tax Administration 2019 (amended by Point a, Clause 6, Article 6 of the Law Amending the Securities Law, Accounting Law, Independent Audit Law, State Budget Law, Law on Management and Use of Public Assets, Tax Administration Law, Personal Income Tax Law, National Reserve Law, Law on Sanctioning Administrative Violations 2024) on supplementary tax returns:

Article 47. Supplementary tax returns 

1. If the taxpayer discovers that a tax return submitted to the tax authority has errors, they may supplement the tax return within 10 years from the expiration date of the filing deadline for the tax period with the error, in the following cases:

a) Before the tax authority or competent authority announces a tax inspection or audit decision;

b) The documents are not within the scope or period specified in the tax inspection or audit decision.

For the content within the scope of inspection or audit, the taxpayer may supplement explanatory documents under the provisions of tax law, inspection law, and in accordance with conclusions and regulations of the competent sectoral authority related to the taxpayer's tax obligations.

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According to the above provisions, if a taxpayer discovers an error in a tax return submitted to the tax authority, they may suplement the document within 10 years from the expiration of the filing deadline for the tax period with the error, provided it is before the tax authority or competent authority announces the inspection or audit decision.

Thus, if the tax authority or competent authority has announced a tax inspection or audit decision at the taxpayer's premises, supplements to tax returns cannot be made.

From January 01, 2025, it is prohibited to file supplementary tax returns when there is a tax audit or inspection decision in Vietnam​ (Image from Internet)

Will taxpayers in Vietnam be penalized if they submit a supplementary tax returns?

Based on Clause 3, Article 9 of Decree 125/2020/ND-CP on cases that are exempt from administrative penalties regarding taxes and invoices:

Article 9. Cases exempt from administrative penalties regarding taxes and invoices

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3. No administrative penalty on tax violations for the case of incorrect declarations, where the taxpayer has supplemented the tax return and self-paid the full amount of tax due before the tax authority announces the inspection or audit decision at the taxpayer's premises or before the tax authority discovers the issue without an inspection or audit at the taxpayer's premises or before another competent authority discovers it.

4. No penalty for procedural violations regarding tax for individuals directly finalizing personal income tax late when there is a tax refund; business households, and individual businesses already assessed for tax according to Article 51 of the Tax Administration Law.

5. No penalty for violations of the tax filing deadline during the period the taxpayer is granted an extension for that tax filing.

According to these regulations, taxpayers submitting supplementary tax returns upon discovering errors and who have self-paid the full amount of tax due before the following instances, will not be penalized:

- Before the tax authority announces the tax inspection or audit decision at the taxpayer's premises

- Before the tax authority discovers the issue without an inspection or audit at the taxpayer's premises

- Before another competent authority discovers it

What methods can taxpayers in Vietnam use to submit tax returns?

Based on Article 48 of the Law on Tax Administration 2019 stipulating the responsibilities of tax management authorities in receiving tax returns:

Article 48. Responsibilities of tax management authorities in receiving tax returns

1. The tax management authority shall receive the taxpayer's filing documents through the following methods:

a) Direct submission at the tax management authority;

b) Submission by postal mail;

c) Submission electronically through the tax management authority’s electronic transaction portal.

2. The tax management authority shall notify the receipt of the tax returns; if the documents are unlawful, incomplete, or not in accordance with the prescribed form, notify the taxpayer within 3 working days from receipt of the documents.

Taxpayers submit tax returns to the tax management authority through the following methods:

- Direct submission at the tax management authority

- Submission by postal mail

- Submission through the electronic transaction portal of the tax management authority.