07 Cases in Which Employees Are Not Authorized to Settle PIT

20:11, 10/07/2024

According to the latest guidance from the Hanoi Tax Department under the General Department of Taxation of Vietnam, employees with income from wages and salaries are not authorized to delegate the personal income tax finalization to the enterprise in the following cases:

- Employees subject to the regulations under Clause 3, Article 21, Circular 92/2015/TT-BTC but have already been issued personal income tax withholding certificates by the enterprise, except for cases where the enterprise has revoked and canceled the issued tax withholding certificates;- Employees have income from salary or wages under a labor contract of 3 months or more but are no longer working at the enterprise at the time of tax finalization authorization;- Employees have income from salary or wages under a labor contract of 3 months or more, and at the same time have incidental income that has not been withheld or insufficiently withheld for tax purposes (including cases where the income is below withholding threshold and has reached withholding threshold but is not withheld);- Employees have income from salary or wages under a labor contract of 3 months or more at multiple enterprises;- Employees only have incidental income that has been withheld at a rate of 10% (including cases where there is only one source of incidental income at one place);- Employees have not registered for a tax code;- Employees have income from salary or wages and are also eligible for tax reduction due to natural disasters, fires, accidents, serious illnesses, shall not authorize tax finalization but shall self-declare and finalize tax along with documents for tax reduction as guided in Clause 1, Article 46, Circular 156/2013/TT-BTC.

Clause 1, Article 21, Circular 92/2015/TT-BTC specifies that individuals with income from salary or wages can authorize the income-paying organization or individual to finalize tax on their behalf in the following cases:

- Individuals only have income from salary or wages under a labor contract of 03 (three) months or more at one organization or individual paying the income and are actually working there at the time of tax finalization authorization, including cases where they do not work for the full 12 (twelve) months of the year.

- Individuals have income from salary or wages under a labor contract of 03 (three) months or more at one organization or individual paying the income and are actually working there at the time of tax finalization authorization, including cases where they do not work for the full 12 (twelve) months of the year, and at the same time, have incidental income from other places averaging not more than 10 million VND per month in the year and have their tax withheld at a rate of 10% by the income-paying unit, with no requirement for tax finalization on this income.

- Individuals are employees transferred from the old organization to the new organization in cases where the old organization undergoes division, separation, merger, consolidation, or conversion. At the end of the year, if the employee authorizes tax finalization, the new organization must retrieve the personal income tax withholding certificates issued by the old organization (if any) to consolidate income, taxes withheld, and finalize tax on behalf of the employee.

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