How long is the reversal period of unpaid back taxes according to Vietnam’s new regulations?

According to Clause 6 Article 8 of the Decree No. 125/2020/NĐ-CP of Vietnam’s Government, reversal period of unpaid back taxes is specified as follows:

- After the time limit for imposition of tax-related administrative penalties expires, taxpayers shall not be sanctioned, but remain obligated to fully pay the state budget all back taxes (underpaid tax amounts, evaded tax amounts, higher-than-prescribed amounts of tax exemption, reduction or refund, or deferred tax amounts) that have accrued over a period of 10 years before the date of discovery of violations. Taxpayers that do not make tax registration shall have to fully pay underpaid tax amounts, evaded tax amounts or deferred tax amounts that accrue over the entire period before the date of discovery of violations.

- Regulations on the reversal period of unpaid back taxes laid down in point a of this clause shall only be applied to taxes subject to tax legislation and other collections which entities or persons must, on their own, declare and pay the state budget.

As for land-derived or other collection, if financial obligations of entities or persons arising from these collections are determined under competent regulatory authorities’ jurisdiction, these authorities shall determine the reversal period of back taxes under land and other relevant legislation which is not less than the reversal period prescribed above.

View more details at the Decree No. 125/2020/NĐ-CP of Vietnam’s Government, effective from December 05, 2020.

Thuy Tram

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