Debt freezing documentation and procedures in Vietnam 2023

Debt freezing documentation and procedures in Vietnam 2023 (Internet image)

Regarding this issue, LawNet would like to answer as follows:

1. Debt freezing documentation in Vietnam 2023

Debt freezing procedures, documentation according to Clause 1, Article 23 of Decree 126/2020/ND-CP is as follows:

- For the taxpayer who is dead or declared dead, missing or incapacitated by the court.

The death certificate, death notice or their substitutes prescribed by civil registration laws; the court’s declaration that a person is dead, missing or incapacitated (original copy, extracted copy from master register or authenticated copy).

- For the taxpayer who submits a dissolution decision to the tax authority or business registration authority, the business registration authority has posted a notice on the national business registration portal but the taxpayer has not completed the dissolution procedures:

The taxpayer’s decision on dissolution and information about the taxpayer’s name, enterprise ID number, the time of the business registration authority publishes information about the taxpayer’s undergoing dissolution on the National Enterprise Registration Information System.

- For the taxpayer who has filed for bankruptcy or requested to file for bankruptcy in accordance with bankruptcy laws:

The court’s notification of receipt of the taxpayer’s petition for bankruptcy (original copy, extracted copy from master register or authenticated copy).

- For the taxpayer who no longer does business at the registered address, the tax authority and the People’s Committee of the commune has confirmed that the taxpayer is no longer present in the area and made a nationwide announcement that the taxpayer or the taxpayer’s legal representative is not present at the registered address.

The written confirmation sent by the tax authority to the People’s Committee of the commune where the taxpayer’s is headquartered that the taxpayer is no longer operating at the registered address and the tax authority’s notice that the taxpayer is no longer operating at the registered (original copy, extracted copy from master register or authenticated copy).

- For the taxpayer whose certificate of business registration, certificate of enterprise registration, certificate of cooperative registration, license for establishment and operation or practice certificates has been revoked by a competent authority, whether such revocation is requested by the tax authority or not.

The written request of the tax authority or another competent authority for revocation of the certificate of business registration, certificate of enterprise registration, certificate of cooperative registration, certificate of household business registration, establishment and operation license  or certificate of branch/representative office registration (original copy, extracted copy from master register or authenticated copy).

2. Debt freezing procedures in Vietnam 2023

Debt freezing procedures according to Clause 3, Article 23 of Decree 126/2020/ND-CP are as follows:

-  In the cases specified in Article 83 of the Law on Tax Administration, after receiving adequate documents specified in Section 2:

The head of the supervisory tax authority of the taxpayer shall issue a decision on debt freezing decision (Form No. 01/KN in Appendix III of Decree 126/2020/ND-CP) on the beginning date of the debt freezing period specified in Section 2.

Form No. 01/KN

- In case the court cancels the declaration that a person is dead, missing or incapacitated or the taxpayer resumes business operation after the tax authority has issued the debt freezing decision: 

The tax authority shall issue a decision to invalidate the debt freezing decision (Form No. 02/KN in Appendix III of Decree 126/2020/ND-CP).

Form No. 02/KN

The tax authority shall charge late payment interest for the period from the issuance date of the invalidation decision to the day on which tax debt is fully paid by the taxpayer.

Tax administration agencies shall calculate late payment interest to taxpayers from the date on which the decision on termination of effect of the decision on freezing the tax arrears is issued to the date the taxpayer fully pays the tax arrears into the state budget.

- In case the taxpayer is eligible for tax debt cancellation as prescribed in Article 85 of the Law on Tax Administration after the tax authority has issued the decision on tax debt freezing, the tax authority issue a decision to invalidate the debt freezing decision (Form No. 02/KN in Appendix III of Decree 126/2020/ND-CP) and cancel the debt as per regulations.

- In case the tax authority discovers that the taxpayer that is an individual, individual business, owner of a household, household business, sole proprietorship or single-member limited liability company whose tax debt has been frozen establishes a new business establishment or enterprise:

The tax authority shall issue a decision to invalidate the debt freezing decision (Form No. 02/KN in Appendix III of Decree 126/2020/ND-CP) and charge late payment interest for the period from the beginning of the debt freezing period to the day on which tax debt is fully paid by the taxpayer.

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