What are the fines for late submission of personal income tax returns in Vietnam? - Thuy Uyen (Bac Ninh).
Pursuant to Article 13 of the Decree 125/2020/NĐ-CP stipulating the fines for late submission of personal income tax returns in Vietnam as follows:
Penalties for violations against regulations on time limits for submission of tax returns
1. Penalties imposed in form of cautions shall be imposed for violations arising from filing tax returns from 01 to 05 days after expiration of the prescribed time limits under mitigating circumstances.
2. Fines ranging from VND 2,000,000 to VND 5,000,000 shall be imposed for the act of submitting tax returns from 01 to 30 days after expiration of the prescribed time limits, except the cases specified in clause 1 of this Article.
3. Fines ranging from VND 5,000,000 to VND 8,000,000 shall be imposed for the act of submitting tax returns from 31 to 60 days after expiration of the prescribed time limits.
4. Fines ranging from VND 8,000,000 to VND 15,000,000 shall be imposed for one of the following violations:
a) Filing tax returns from 61 to 90 days after expiration of the prescribed time limits;
b) Filing tax returns at least 91 days after expiration of the prescribed time limits if none of additional taxes is incurred;
c) Failing to submit tax returns if none of additional taxes is incurred;
d) Failing to submit annexes under regulations regarding tax administration by enterprises having related-party transactions, enclosing CIT finalization dossiers.
5. Fines ranging from VND 15,000,000 to VND 25,000,000 shall be imposed for the act of filing tax returns more than 90 days after the prescribed deadline if such act results in additional taxes to be paid, and the taxpayer has fully paid taxes, deferred amounts into the state budget before the time of the tax authority’s announcement of the decision on tax inspection and examination, or before the time of the tax authority’s issuance of the report on the deferred submission of tax returns under the provisions of clause 11 of Article 143 in the Law on Tax Administration.
In case where the fine amount prescribed in this clause is greater than the tax amount additionally incurred in the tax return, the maximum amount of fine for this act shall be equal to the tax amount payable specified in the tax return and shall not be less than the average of fine amounts in the range prescribed in clause 4 of this Article.
a) Compelling the full payment of deferred tax amounts into the state budget with respect to the commission of the acts prescribed in clause 1, 2, 3, 4 and 5 of this Article if the taxpayer delays filing their tax return, leading to the late payment of taxes;
b) Compelling the submission of tax returns, enclosing annexes, in case of committing the acts specified in point c and d of clause 4 of this Article.
Pursuant to Clause 4 Article 7 of the Decree 125/2020/NĐ-CP stipulating as follows:
Sanctioning forms, remedies and principles of imposition of fines for tax or invoice-related administrative violations
4. Principles of determination of fine amounts
a) The fine amounts specified in Article 10, 11, 12, 13, 14 and 15; clause 1 and 2 of Article 19; and Chapter III herein, shall be those applied to violating entities.
Taxpayers that are family households or sole proprietorship households shall be fined the same as violating persons.
b) When determining the fine amounts imposed on the taxpayers that commit violations under both aggravating and mitigating circumstances, the aggravating circumstance shall be reduced or relieved according to the one-for-one rule under which a mitigating circumstance is offset against a aggravating circumstance.
c) Any mitigating or aggravating circumstance which is already used as a basis for determining the fine range for a violation shall not be used for determination of the specific fine amount under the provisions of point d of this clause.
d) With respect to fines, the specific amount of fine for a violation arising from the implementation of tax or invoice-related procedures as prescribed in Article 19 herein must be the average of specific fines in the range for such violation. For a mitigating circumstance that exists, the average fine for a violation in the fine range shall be reduced by 10% provided that the fine amount imposed for such violation is not lower than the minimum fine in that range. Meanwhile, for an aggravating circumstance that exists, the average fine for a violation in the fine range shall be increased by 10% provided that the fine amount imposed for such violation is not greater than the maximum fine in that range.
As regulations above, a fine ranging from 2.000.000 VND đến 25.000.000 VND shall be imposed on the violator depending on late payment or any mitigating or aggravating circumstance.
In addition, the full payment of deferred tax amounts into the state budget is imposed on the taxpayer delays filing their tax return, leading to the late payment of taxes.
The fines for individuals shall be a half of above fines.
Pursuant to Clause 3 Article 7 of the Decree 126/2020/NĐ-CP (supplemented by Clause 2 Article 1 of the Decree 91/2022/NĐ-CP) stipulating as follows:
Tax declaration dossier
3. A taxpayer is not required to declare tax in the following cases:
a) The taxpayer only has business operations that are not subject to any tax.
b) The taxpayer is an individual earning tax-free income as prescribed by personal income tax laws and Point b Clause 2 Article 79 of the Law on Tax administration, except individuals that receive real estate as inheritance or gift and individuals that transfer real estate.
c) An enterprise that only exports is not required to declare VAT.
d) The taxpayer’s business suspension is suspended as prescribed in Article 4 of this Decree.
dd) The taxpayer applies for TIN invalidation, except termination of business operation, contract or business rearrangement prescribed in Clause 4 Article 44 of the Law on Tax administration.
e) The declarant of personal income tax is the income payer, declares personal income tax monthly or quarterly, and does not deduct personal income tax in the same month or quarter.
Thus, in case no monthly or quarterly personal income tax declaration, there is no deduction of personal income tax of income recipients, taxpayers do not need to submit monthly PIT declarations for that month or quarter.
Pursuant to Article 47 of the Law on Tax Administration in 2019 stipulating as follows:
Tax dossier supplementation
1. In case the tax declaration dossier submitted to the tax authority is erroneous or inadequate, supplementary documents may be provided within 10 years from the deadline for submission of the erroneous or inadequate tax declaration dossier but before the tax authority or a competent authority announces a decision on tax document examination.
2. When the tax authority or a competent authority has announced the decision on tax inspection or tax audit on the taxpayer’s premises, the taxpayer is still allowed to provide supplementary documents; the tax authority shall impose administrative penalties for the violations specified in Article 142 and 143 of this Law.
3. After the tax authority or competent authority issues a conclusion or tax decision when the inspection is done:
a) The taxpayer may provide supplementary tax documents if they increase the tax payable or reduce the deductible tax, exempted tax or refundable tax, and shall face administrative penalties for the violations specified in Article 142 and Article 143 of this Law;
b) If the supplementation leads to a decrease in the tax payable or an increase in the deductible tax, exempted tax or refundable tax, the taxpayer shall follow procedures for filing tax-related complaints.
4. Supplementary documents include:
a) The supplementary tax return;
b) The explanation for the supplementation and relevant documents.
5. Supplementary tax documents on exports and imports shall be provided in accordance with customs laws.
As regulations above, the taxpayer can still provide supplementary documents for personal income tax decleration when the tax authority has announced the decision on tax audit on the taxpayer’s premises.
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