Important Points on Business License Tax for 2018

License fee is a direct tax. Taxpayers submit declarations to the tax authorities that directly manage them; business operations should be registered where they are conducted.

The declaration and payment will be carried out according to Circular 302/2016/TT-BTC and Decree 139/2016/ND-CP.

Payment Levels

According to the law on fees and charges: Individuals and households shall pay the license fee according to 3 tiers: Revenue over 500 million VND/year will incur a fee of 1 million VND/year; revenue over 300 million to 500 million VND/year will incur a fee of 500,000 VND/year; revenue over 100 million to 300 million VND/year will incur a fee of 300,000 VND/year.

For enterprises, there are also 3 tiers, but the fees are higher: Revenue over 10 billion VND will incur an annual fee of 3 million VND; revenue up to 10 billion VND will incur an annual fee of 2 million VND; branches, representative offices, business locations, public service providers, and other economic organizations will incur an annual fee of 1 million VND.

Points to Note in Declaration and Payment of License Fee:

Taxpayers only declare the license fee once when starting their business. In case of organizations engaging in the production and trading of goods and services with changes in charter capital or investment capital, no new license fee declaration is required.

If representative offices or business locations engage in the production and trading of goods and services, they must pay a license fee; otherwise, they are exempt.

For newly established enterprises: If the enterprise has started its business activities, the latest deadline for submitting the license fee declaration is the last day of the month.

For enterprises that have not started business activities yet: The latest deadline for submitting the license fee declaration is within 30 days from the date of receipt of the business registration certificate.

For ongoing enterprises: If there is no change in charter capital or a change in the number of branches, there is no need to submit a new license fee declaration, only the fee payment, which is due by January 31, 2018.

If there are changes in charter capital or the number of branches during the year that affect the fee amount, the latest deadline for submitting the new declaration is December 31 of the year of change, and fee payment is due by January 31.

Notices When Calculating the License Fee

If a taxpayer establishes a business in the first 6 months of the year, the full-year license fee is payable.

If a taxpayer establishes a business in the latter 6 months of the year (from July 1 to the end of the year), 50% of the full-year fee is payable.

If a taxpayer is involved in production and business activities but does not declare the license fee, the full-year fee is payable, irrespective of the timing of detection.

Organizations, individuals, and groups of individuals or households engaging in business and notifying tax authorities of a full-calendar-year suspension of business are exempt from the license fee for the year of business suspension. If the business suspension is not for a full calendar year, the full-year license fee is still payable.

Source: Vietnam Financial Times Online

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