Regulations on fulfillment of tax obligations upon exit from Vietnam

Regulations on fulfillment of tax obligations upon exit from Vietnam (Internet image)

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

1. Regulations on fulfillment of tax obligations upon exit from Vietnam

Regulations on fulfillment of tax obligations upon exit from Vietnam according to Article 21 of Decree 126/2020/ND-CP are as follows:

- Exit from Vietnam will be suspended in the following cases:

+ The individual, the individual that is the legal representative of an enterprise has not fulfilled tax obligations under a tax enforcement decision.

+ A Vietnamese national has not fulfilled his/her tax obligations before emigration.

+ A Vietnamese national residing overseas has not fulfilled his/her tax obligations before exit.

+ A foreigner has not fulfilled his/her tax obligations before exit.

- Authority to impose, extend and cancel suspension from exit

+ The head of the supervisory tax authority of the taxpayer has the authority to suspend the taxpayer from exit in the cases specified in Clause 1 of Article 21 of Decree 126/2020/ND-CP.

+ The person that imposes the exit suspension also has the authority to extend and cancel the suspension.

+ The person that imposes the exit suspension shall cancel the suspension within 24 hours after the taxpayer fulfills his/her tax obligations.

- Procedures for imposing, extending and cancelling exit suspension

+ After a taxpayers’ tax obligations are determined, the tax authority shall compile a list of individuals suspended from exit and send a suspension notice (Form No. 01/XC in Appendix III of Decree 126/2020/ND-CP) to the immigration authority and the taxpayers.

+ Within the day on which the suspension notice is received, the immigration authority shall suspend these persons from exit and post the suspension notice on its website.

+ If a suspended person has fulfilled his/her tax obligations within 24 working hours, the tax authority shall issue a suspension cancellation notice (Form No. 02/XC in Appendix III of Decree 126/2020/ND-CP) and send it to the immigration authority.

For suspended persons who have not fulfilled their tax obligations in 30 days before expiration of the suspension period, the tax authority shall send a notice of extended suspension (Form No. 02/XC) to the immigration authority and these persons.

+ The suspension notice, extended suspension notice and suspension cancellation notice shall be sent by post or electronically if possible and posted on the website of the tax authority.

It will be considered that a notice has been sent if it has been posted on the tax authority’s website even if it is returned after sent by post.

2. Tax liability imposition authority, procedures and decision in Vietnam

Tax liability imposition authority, procedures and decision according to Article 16 of Decree 126/2020/ND-CP are as follows:

- Authority for tax liability imposition:

The Director of the General Department of Taxation, Directors of Provincial Departments of Taxation and Directors of District-level Departments of Taxation have the authority to impose tax liability.

- Procedures for tax liability imposition

+ When imposing tax liability, the tax authority shall send a written notice to the taxpayer and issue the tax liability imposition decision, which must specify the reasons and basis for imposition, the tax amount payable and payment deadline.

+ In case the tax authority imposes tax liability through tax audit or tax inspection, the reasons and basis for imposition, the tax amount payable and payment deadline shall  be written in the tax audit or tax inspection record and tax decision issued by the tax authority.

+ In case tax liability is imposed due to the taxpayer’s violation, the tax authority shall impose administrative penalties and calculate late payment interest as prescribed by law.

- Decision on tax liability imposition

+ When imposing tax liability, the tax authority shall issue a decision (Form No. 01/ADT in Appendix III of Decree 126/2020/ND-CP) and send it to the taxpayer within 03 working days from the day on which it is signed;

If the taxpayer has to pay tax under the tax authority’s notice, such a decision is not necessary.

+ The taxpayer shall pay tax as imposed by the tax authority. If the taxpayer does not concur with the tax liability imposed by the tax authority, the taxpayer still has to pay the tax and may request the tax authority to provide explanation or file a complaint or lawsuit against the tax authority’s decision.

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