During the operation, businesses for many reasons may face difficulties leading to the temporary cessation of operations. So during this time, how does the business make tax declarations?
Article table of contents
According to Clause 3 Article 206 of the Law on Enterprises 2020 of Vietnam, during the suspension period, the enterprise shall fully pay the unpaid taxes, social insurance, health insurance, unemployment insurance premiums and fulfill contracts with its clients and employees, unless otherwise agreed by the enterprise, creditors, clients and employees.
According to Clause 2 Article 4 of the Decree No. 126/2020/NĐ-CP, tax administration during taxpayer’s business suspension is prescribed as following:
- The taxpayer is not required to submit tax declaration dossiers, unless the suspension begins in the middle of a monthly/quarterly/annual tax period, in which case the tax declaration dossier of that month/quarter/year must be submitted.
- For household businesses and individual businesses paying presumptive tax, tax authorities shall decide the tax payable upon their suspension in accordance with regulations of the Minister of Finance of Vietnam.
- The taxpayer must not use invoices and are not required to submit invoice use reports. In case the taxpayer is permitted by the tax authority to use invoices in accordance with invoice laws, the taxpayer shall submit the tax declaration dossier and invoice use reports as per regulations.
- The taxpayer shall implement the tax authority’s decisions and notices of debt collection, enforcement of tax decisions, inspection of compliance to tax laws and administrative penalties for tax offenses in accordance with the Law on Tax administration of Vietnam.
Therefore, the taxpayer is not required to submit tax declaration dossiers, unless the suspension begins in the middle of a monthly/quarterly/annual tax period, in which case the tax declaration dossier of that month/quarter/year must be submitted.
In cases the business operation is resumed:
- If the taxpayer is not required to send a notice of business resumption to the tax authority to which the business suspension notice is submitted if business operation is resumed as planned.
- If the taxpayer shall send a notice of business resumption to the tax authority to which the business suspension notice is submitted, implement tax laws, submit tax documents and invoice use reports if business operation is resumed ahead of schedule.
- If the taxpayer is an organization, household business or individual business that is not required to apply for business registration, the notice shall be sent to the supervisory tax authority at least 01 working day before the resumption date.
Note: A taxpayer that directly applies for taxpayer registration with a tax authority must not suspend its business if the tax authority has issued a notice that the taxpayer does not operate at the registered address.
Thuy Tram
