Procedures for declaration and payment to the state budget of proceeds from conversion of enterprise ownership in Vietnam

Procedures for declaration and payment to the state budget of proceeds from conversion of enterprise ownership in Vietnam (Internet image)

The Ministry of Finance of Vietnam issued Decision 149/QD-BTC dated February 9, 2023 announcing new administrative procedures in the tax field under the management functions of the Ministry of Finance.

Procedures for declaring and remitting to the state budget the proceeds from the conversion of ownership of enterprises, public non-business units, revenues from the transfer of state capital, and the difference between the equity capital and the charter capital of the enterprise are as follows:

1. Components of the application for declaration and payment to the state budget of the proceeds from the conversion of enterprise ownership, public service providers in Vietnam

The declaration of collection amount is made according to the declaration form specified in Article 7 of Circular 57/2022/TT-BTC.

2. Order of carrying out procedures for declaration and payment of state budget revenues from the conversion of enterprise ownership in Vietnam

- Enterprises, public non-business units, and other subjects are responsible for declaring and paying the amount of money collected from the conversion of ownership of enterprises, public non-business units, the revenue from the transfer of state capital, and the difference between the equity capital and the charter capital of the enterprise.

- Within the time limit specified in Article 7 of Circular 57/2022/TT-BTC, enterprises, public non-business units, and other subjects responsible for declaring and paying revenues to the state budget shall declare and pay them according to the provisions of Article 6 of Circular 57/2022/TT-BTC, specifically:

+ Revenues from the equitization of enterprises and public non-business units:

++ Proceeds from the public auction:

Within 05 working days from the deadline for payment of money from investors participating in the auction, the organization conducting the auction is responsible for declaring and paying the proceeds from the sale of shares.

++ Proceeds from auctions are distributed among strategic investors:

Within 05 working days from the deadline for payment to investors participating in the auction, enterprises and public non-business units are responsible for declaring and paying the proceeds from the sale of shares.

++ Proceeds from underwriting:

Within 10 days from the date of completion of the sale and purchase of shares under the guarantee contract, the underwriting organization shall declare and pay the proceeds from the sale of shares.

++ Proceeds from the sale of agreements to investors, the sale of preferred shares to trade unions, employees, and business managers:

Within 05 working days from the deadline for payment, the enterprise or non-business unit shall publicly pay the proceeds from the sale of shares.

++ Proceeds from selling shares of equitized enterprises by book-building method:

Within 05 working days from the date of expiry of payment for the purchase of shares by investors, the order book management organization shall declare and pay the proceeds from the sale of shares.

++ Proceeds from equitization at the time of official conversion into a joint stock company:

Within 90 days from the date of first issuance of the Certificate of Business Registration, the joint-stock companies converted from enterprises and public non-business units to be equitized are responsible for determining by themselves the amount of money collected from equitization to be remitted to the state budget and making declarations and payments.

Within 05 working days from the day on which the decision of the agency representing the owner approves the finalization of the proceeds from equitization at the time of official transformation into a joint stock company, the joint-stock companies converted from enterprises or public non-business units to be equitized shall declare and pay the increased difference compared to the paid amount (if any).

++ Other revenues:

Within 30 days from the date of expiry of the warranty period under the contract, the equitized enterprise shall declare and pay the entire balance of the reserve for warranty of products, goods, and construction works without any expenses (for signed contracts, the warranty period is valid after the date of first issuance of the Business Registration Certificate)

Within 10 working days from the date of receipt of the proceeds from the collection and handling of debts and assets, the DATC is responsible for declaring and paying the payable amounts.

In case the payable amount is less than VND 100 million according to each arising, DATC shall collect and pay monthly within 05 working days from the end of the preceding month.

Within 10 working days from the date of debt collection, commercial banks and enterprises operating in the telecommunications sector are responsible for declaring and remitting to the state budget the amount payable from debts that are not included in the recovered value of the equitized enterprise.

+ Revenues from the transfer of state capital invested in joint-stock companies, limited liability companies with two or more members; Revenues from the transfer of the right to purchase additional shares for the state capital portion and the right to contribute state capital to the enterprise:

++ Income from the transfer of state capital invested in joint-stock companies, limited liability companies with two or more members:

Within 15 days from the date of announcing the results of the public auction/competitive offering or signing the capital transfer contract (for the negotiated method), the owner's representative agency (or authorized unit) is responsible for declaring and paying the proceeds from the transfer of state capital.

Within 10 working days from the date of performing capital transfer transactions at enterprises registered for trading and listed on the Stock Exchange, the owner's representative agency (or authorized unit) is responsible for declaring and paying the proceeds from the transfer of state capital.

Within 10 working days from the date of receipt of money from the order book management organization, the owner's representative agency (or authorized unit) shall declare and pay the proceeds from the capital transfer.

In case, after approving the final settlement of the proceeds from the capital transfer, there is an increase in the amount payable to the state budget within ten (10) working days from the date of issuance of the decision approving the finalization of the proceeds from the capital transfer, the owner's representative agency shall declare and pay the increased difference compared to the paid amount.

+ Collection and transfer of the right to buy additional shares issued for the state capital portion and the right to contribute state capital to the enterprise:

Within 10 working days after the investor's payment deadline, the owner's representative agency (or authorized unit) is responsible for declaring and paying the proceeds from the transfer of the right to buy additional shares for the state capital and the right to contribute state capital to enterprises.

Within 10 working days from the date of issuance of the decision approving the finalization of the proceeds from the transfer of the right to purchase additional shares for the state capital and the right to contribute state capital to the enterprise, the owner's representative agency (or authorized unit) is responsible for declaring and paying the additional difference compared to the paid amount (if any).

+ Revenues from the transfer of state capital invested in enterprises assigned by the Prime Minister to SCIC to transfer capital to pay into the state budget:

Within 10 working days from the deadline for the investor's payment, SCIC is responsible for declaring and remitting to the state budget the proceeds from the transfer of state capital made by SCIC.

+ Income from the difference between equity capital and charter capital in operating tier-1 enterprises:

Within 10 days from the date the agency representing the owner issues a decision on the payment of the difference between the equity and the charter capital of the enterprise into the state budget, enterprises are responsible for declaration and payment.

+ Revenues from other forms of ownership arrangement and conversion:

++ Selling business:

Within 10 working days after the owner's representative agency approves the settlement of proceeds from the sale of the entire enterprise, the owner's representative agency (or authorized unit) is responsible for declaring and paying all proceeds from the sale of the business after deducting expenses.

++ Converting an enterprise with 100% charter capital held by the State into a limited liability company with two or more members:

Within 10 working days from the date the competent authority approves the finalization of the proceeds from the business transformation, at the time the limited liability company with two or more members is granted the Certificate of Business Registration for the first time, the owner's representative agency (or authorized unit) is responsible for declaring and paying the proceeds from the business transformation after deducting expenses.

3. Method of making dossiers of declaration and payment of state budget revenues from the conversion of enterprise ownership in Vietnam

Submit the application file directly or by post to the tax agency directly managing the enterprise or public non-business unit.

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