Tax-related administrative penalties on violating tax payment guarantor according to Vietnam’s regulations

According to Clause 1 Article 18 of the Decree No. 125/2020/NĐ-CP of Vietnam’s Government, tax-related administrative penalties on violating commercial banks, tax payment guarantor are as follows:

- Fines equaling the amounts of tax, the deferred amounts of tax or the fines not paid into the state budget (minus minimum balances of demand accounts subject to regulations of commercial banks providing fiduciary payment services for taxpayers) shall be imposed upon commercial banks defaulting on liabilities to withdraw money from taxpayer's accounts to pay into the state budget’s accounts upon tax authority’s request, except when taxpayer’s accounts opened at these commercial banks have zero balance, or all balance has been left zero due to the remittance of all money left in taxpayer’s accounts to the state budget's accounts if such remittance is not sufficient to pay off all taxes owed by the taxpayer.

- Guarantors must act on taxpayers’ behalf to pay taxes, deferred taxes, fines and amounts of interest on late payment of fines (if any) according to terms and conditions of deeds of guarantee if these taxpayers fail to pay into the state budget.

- Upon expiration of the term of guarantee, if guarantors have not yet discharged guarantee obligations to taxpayers that fail to pay or have not yet paid outstanding taxes, deferred taxes, fines or amounts of interest on late payment of fine, guarantors shall be charged interest on late payment of taxes, fines and shall be subject to law enforcement measures prescribed in the Law on Tax Administration of Vietnam.

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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