What is the deadline to pay the licensing fee in Vietnam?

What is the deadline to pay the licensing fee in Vietnam? (Internet image)

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

1. Licensing fee payers in Vietnam

According to Article 2 of Decree 139/2016/ND-CP, the licensing fee payers are the organizations and individuals that operating their trade/production of goods and services except the cases specified in Section 3, including:

- The enterprises which are established under the regulations of law.

- The organizations which are established under the Law on Cooperatives.

- The public service providers which are established under the regulations of law.

- The business organizations of the political organizations, the social – political organizations, the occupational – social organizations and people's armed units.

- Other organizations which have their trade/production activities.

- The branches, the representative offices of organizations specified in Paragraphs 1, 2, 3, 4 and 5 of Article 2 of Decree 139/2016/ND-CP (if any).

- The individuals, groups of individuals and households that have their trade/production activities.

2. What is the deadline to pay the licensing fee in Vietnam?

Deadline to pay the licensing fee in Vietnam

- Licensing fee shall be paid annually by the 30th of January.

- For medium and small enterprises converted from household businesses (including their dependent units and business locations), upon expiration of the licensing fee exemption period (3 years from the establishment date):

+ If the expiration date is in the first 6 months of the year, licensing fee shall be paid by the 30th of July of the same year.

+ If the expiration date is in the last 6 months of the year, licensing fee shall be paid by the 30th of January of the succeeding year.

- Household businesses and individual businesses that shut down and subsequently resume their business operation shall pay licensing fee as follows:

+ If the resumption date is in the first 6 months of the year, licensing fee shall be paid by the 30th of July of the same year.

+ If the resumption date is in the last 6 months of the year, licensing fee shall be paid by the 30th of January of the succeeding year.

(Clause 9, Article 18, Decree 126/2020/ND-CP)

3. Rate of licensing fees in Vietnam

Pursuant to Article 4 of Decree 139/2016/ND-CP (amended in Decree 22/2020/ND-CP), rate of licensing fees as follows:

- The rate of licensing fees for the organizations having the production and business of goods and services is as follows:

+ The organizations with charter capital and investment capital over 10 billion dong: 3,000,000 dong/year;

+ The organizations with charter capital and investment capital of less than 10 billion dong: 2,000,000 dong/year;

+ The branches, representative offices, business location, public service providers and other business organizations: 1,000,000 dong/year;

The rate of licensing fees for the organizations specified under Point a and b of this Paragraph is based on the charter capital written in the certificate of business registration or on the investment capital written in the certificate of investment registration in case of no charter capital.

- The rate of licensing fees for the individuals and households having the production and business of goods and services is as follows:

+ The individuals, groups of individuals and households with revenues over 500 million dong/year: 1,000,000 dong/year;

+ The individuals, groups of individuals and households with revenues between 300 and 500 million dong/year: 500,000 dong/year;

+ The individuals, groups of individuals and households with revenues between 100 and 300 million dong/year: 300,000 dong/year;

Revenues used as the basis for determining the license fees payable by individuals, groups of individuals and household businesses shall be determined according to guidance given by the Ministry of Finance

- Upon the end of the period of exemption from the license fee (from the fourth year from the date of establishment), a SME transformed from a household business (including its branches, representative offices and/or business locations) shall pay the license fee for the whole year if its exemption period ends in the first 6 months of the year or pay 50% of the license fee payable for the whole year if its exemption period ends in the last 6 months of the year.

A household business, an individual or a group of individuals engaging in production/business that resumes its production/business after a suspension period shall pay the license fee for the whole year if it resumes its production/business in the first 6 months of the year or pay 50% of the license fee payable for the whole year if it resumes its production/business in the last 6 months of the year.

- If the organizations specified under the Points a and b, Paragraph 1 of Article 4 of Decree 139/2016/ND-CP change their charter capital or investment capital, the ground for determining the rate of licensing fees is their charter capital or investment capital of the year preceding the year of calculation of licensing fees.

Where the charter capital or investment capital written in the certificate of business registration or certificate of investment registration is in foreign currency, it shall be converted into Vietnamese dong as a basis for determining the rate of licensing fees in accord with the buying rate of commercial banks or credit institutions where the licensing fee payers open their accounts at the time they make payment to the state budget.

- An operating payer of the license fee that has notified its supervisory tax authority in writing of its suspension of production/business in a calendar year must not pay the license fee for that year of production/business suspension if it has sent a written notification of production/business suspension to its supervisory tax authority before the prescribed deadline for paying the license fee (January 30 annually) and has made no payment of the license fee for the planned year of suspension.

It must pay the license fee for the whole year if it does not meet the abovementioned conditions for production/business suspension.

Nguyen Ngoc Que Anh

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