How to determine presumptive revenue and fixed tax of fixed tax payers in Vietnam?

How to determine presumptive revenue and fixed tax of fixed tax payers in Vietnam? - image from internet

Pursuant to Clause 4 Article 13 of the Circular 40/2021/TT-BTC (effective from 01/08/2021) stipulating determination of presumptive revenue and fixed tax of fixed tax payers in Vietnam:

Determination of presumptive revenue and fixed tax

- Determination of presumptive revenue and fixed tax

+ Presumptive revenue and fixed tax shall be determined by calendar year or month in case of seasonal business that is stable throughout a year.

+ The fixed tax payer shall determine the presumptive revenue themselves using tax form No. 01/CNKD enclosed herewith. In case the fixed tax payer fails to determine the fixed tax, submit the tax declaration dossier or the fixed tax is not reasonable, the tax authority shall impose the presumptive revenue and fixed tax in accordance with Article 51 of the Law on Tax Administration.

+ The tax declaration dossier submitted by the fixed tax payer, the tax authority’s database shall be the basis for public survey, seeking opinions from Tax Advisory Council, and for Provincial Department of Taxation to review tax books at the sub-department of taxation.

- Adjusting presumptive revenue and fixed tax

In case the fixed tax payer wishes to adjust the presumptive revenue and fixed tax due to changes in business operation, the tax authority shall adjust the fixed tax as prescribed in Clause 3 Article 15 of the Law on Tax Administration from the day on which the change occurs. To be specific:

+ The fixed tax payer that changes the business scale (business area, employees, revenue) shall revise the tax form No. 01/CNKD enclosed herewith. If the presumptive revenue varies by 50% or over, the tax authority shall issue a notice (Form No. 01/TB-CNKD enclosed with Decree No. 126/2020/ND-CP) of change in fixed tax from the day on which the change occurs. If the tax authority determines that the taxpayer does not satisfy the conditions for changing the fixed tax, the tax authority shall issue the notice of retention of fixed tax (Form No. 01/TBKDC-CNKD enclosed herewith).

+ The fixed tax payer that changes their business location shall apply for change of taxpayer registration information as per regulations and declare tax at the new location as a new fixed tax payer. The tax authority shall carry on procedures according to the application for change of taxpayer registration information. The supervisory tax authority of the taxpayer’s new location shall handle the tax declaration dossier as that of a new business. The supervisory tax authority of the taxpayer’s old location shall issue a notice (Form No. 01/TB-CNKD enclosed with Decree No. 126/2020/ND-CP) of change in fixed tax from the day on which the change occurs.

+ The fixed tax payer that changes their business lines (even if tax rates are not changed) shall follow the procedures for change of tax registration information (if business lines are changed) and revise the tax form No. 01/CNKD enclosed herewith. The tax authority shall issue a notice (Form No. 01/TB-CNKD enclosed with Decree No. 126/2020/ND-CP) of change in fixed tax from the day on which the change occurs.

+ The fixed tax payer that shuts down or suspends business operation shall submit a notification as prescribed in Article 4 of Decree No. 126/2020/ND-CP. On the basis of the notification submitted by the fixed tax payer or the competent authority prescribed in Article 37 of the Law on Tax Administration, the tax authority shall adjust the fixed tax as follows:

++ If the shutdown has been approved and the shutdown date is the first day of the month, the fixed tax incurred in that month will be cancelled. If the shutdown date is any date during the period from the 2nd to the 15th of the month, the fixed tax incurred in that month will be reduced by 50% and the fixed tax incurred in the months afterwards will be cancelled. If the shutdown date is any date during the period from the 16th to the end of the month, the fixed tax incurred in that month will not be reduced and fixed tax incurred in the months afterwards will be cancelled.

++ If the suspension has been approved and business is suspended for a full month, fixed tax incurred in that month will be cancelled; if business is suspended for at least 15 consecutive date in the month, fixed tax incurred in that month will be reduced by 50%.

++ Shutdown or suspension time shall be determined according to the taxpayer’s notification. In case the taxpayer fails to submit or punctually submit the notification (even if it is caused by a force majeure event), the tax authority shall determine the shutdown or suspension time through field inspection.

+ In case the taxpayer that shuts down or suspends business operation at the request of a competent authority, the tax authority shall adjust the fixed tax according to the written request for shutdown or suspension issued by the competent authority.

+ The fixed tax payer that switches to paying tax under periodic declarations shall revise the tax form according to Form No. 01/CNKD enclosed herewith. The tax authority shall adjust the fixed tax according to the revised tax form.

Best regards!