Pursuant to the Government’s Decree No. 87/2017/ND-CP dated July 26, 2017 on functions, tasks, powers and organizational structure of the Ministry of Finance;

At the request of the Director General of the General Department of Taxation;

The Minister of Finance promulgates a Circular on elaboration of some Articles of the Law on Tax Administration and the Government’s Decree No. 126/2020/ND-CP dated October 19, 2020 on elaboration of some Articles of the Law on Tax Administration.Article 1. Scope

This Circular provides guidance on state budget revenues under management of tax authorities specified in Article 7, Article 28, Article 42, Article 59, Article 60, Article 64, Article 72, Article 73, Article 76, Article 80, Article 86, Article 96, Article 107 and Article 124 of the Law on Tax Administration dated June 13, 2019, Article 30 and Article 39 of Decree No.126/2020/ND-CP regarding tax declaration currencies, tax payment in foreign currencies, exchange rates; duties, entitlements and responsibilities of tax advisory councils of communes, wards and commune-level towns (hereinafter referred to as "communes"); declaring, calculating, distributing tax; tax forms; handling of late tax payment; handling of overpaid tax, late payment interest, fines; application for tax payment in instalments, application for tax deferral; procedures for tax refund, classification of tax refund applications, receipt of tax refund applications; applications for tax exemption and reduction; applications for cancellation of tax, late payment interest, fine debts; development, collection, processing and management of taxpayers’ information; procedures for tax inspection, tax administration of e-commerce, digital platform-based business and other services provided by overseas suppliers without permanent establishments in Vietnam; authorized collection.

Article 2. Regulated entities

This Circular applies to taxpayers, tax authorities, tax officials, other relevant state authorities, organizations and individuals according to Article 2 of the Law on Tax Administration.

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Besides the terms defined in the Law on Tax Administration and Decree No.126/2020/ND-CP, some terms in this Circular are construed as follows:

1. “e-commerce” means some or all commerce processes using electronic media connected to the Internet, mobile telecommunications networks or other open networks as defined in the Government’s Decree No. 52/2013/ND-CP dated May 16, 2013.

2. “digital platform-based business” means business operations by entities via intermediate digital systems in order to connect to customers; all connection activities take place in the digital environments.

3.  “province” means a province or a central-affiliated city.

4. “distribution of tax obligations” means the taxpayer declaring tax at the supervisory tax authority or tax state budget revenue-managing tax authority and determine the amount of tax payable in each province to which state budget revenue is distributed (hereinafter referred to as “receiving province”) as prescribed by law.

5. “supervisory tax authorities” include:

a) The tax authority responsible for the administrative division where the taxpayer’s is headquartered, except the case in Point c of this Clause;

b) The tax authority responsible for the administrative division in another province where the taxpayer’s dependent unit is located to which the dependent unit directly declares tax;

c) Major Enterprise Departments of Taxation affiliated to General Department of Taxation that are established under the Prime Minister’s Decision No. 15/2021/QD-TTg dated 30/3/2021;

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dd) In case an individual receives inheritance or gift that are securities or stakes in business organizations in Vietnam and has to declare tax directly at the tax authority, his/her supervisory tax authority shall be the supervisory tax authority of the issuer; in case the issuer has multiple supervisory tax authorities, the supervisory tax authority of the individual shall be the tax authority of the area where he/she resides.

The supervisory tax authority may be written on the taxpayer registration certificate or TIN notice or supervisory tax authority notice when issuing the enterprise ID number, corporate ID number, TIN or when changing registration information or reassigning supervisory tax authorities as prescribed by law.

6.  “tax authority of the receiving province” is the tax authority that is located within the administrative division where the state budget revenue is received and specified by the taxpayer on the tax return but must not receive tax declaration dossiers from taxpayers as per regulations.  A tax authority of the receiving province can be:

a) The tax authority that is located in the administrative division where the taxpayer is headquartered but is not the supervisory tax authority of the taxpayer;

b) The tax authority that is located in a province other than the province in which the taxpayer is headquartered but still receives the state budget revenues according to Clause 2 and Clause 4 Article 11 of Decree No.126/2020/ND-CP, Articles 12, 13, 14, 15, 16, 17, 18 and 19 of this Circular.

7. “state budget revenue-managing tax authority” is the tax authority that is located within the administrative division where the procedures for declaring, paying, refunding, reducing, exempting tax, and other procedures are completed according to the Law on Tax Administration and its guiding documents or assigning documents of competent authorities, but is not the supervisory tax of the taxpayer.

8. “dependent units” include branches and representative offices.

9. “business location” is any location where the taxpayer’s business operations take place (except the location of the headquarters and dependent units.

10. “sub-departments of taxation” include sub-departments of taxation and regional sub-departments of taxation.

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Article 4. Tax declaration currencies, tax payment in convertible foreign currencies and actual exchange rates

1. Cases of tax declaration and tax payment in convertible foreign currencies:

a) Petroleum exploration and extraction (except crude oil, condensate, natural gas for sale in Vietnam or otherwise prescribed by the Government), including: resource royalty, corporate income tax (CIT); surcharges on distributable surplus of oil in case of increase in crude oil price; profit on oil and gas distributed to the host country; signature bonus; discovery bonus; production bonus; payment for access to petroleum documentation; damages for non-fulfillment of minimum requirements; CIT on income from transfer of right to participate in petroleum contracts; special taxes, surcharges and CIT on retained oil surplus of Vietsovpetro JV in block 09.1 that are declared and paid to state budget using convertible foreign currencies.

b) Fees, charges and other amounts collected by diplomatic missions of the Socialist Republic of Vietnam:

Declared and paid to state budget using the foreign currencies prescribed in the documents on fees, charges and other amounts.

c) Fees and charges that may be collected in foreign currencies by agencies and organizations in Vietnam:

Declared and paid to state budget using the foreign currencies prescribed in the documents on fees and charges.

d) E-commerce, digital platform-based business and other services provided by overseas suppliers without permanent establishments in Vietnam:

Declared and paid to state budget using convertible foreign currencies.

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Article 5. Responsibility for tax administration of supervisory tax authorities, tax authority of the receiving province and state budget revenue-managing tax authority

1. Supervisory tax authorities

Supervisory tax authorities shall fully comply with regulations on tax administration of the Law on Tax Administration and its guiding documents (except the regulations of Clause 3 of this Article. To be specific:

a) Receive tax declaration dossiers, extend deadlines for submission of tax declaration dossiers and impose penalties for violations committed by taxpayers against regulations of law on submission of tax declaration dossiers.

b) Calculate late payment interest, adjust late payment interest payable by taxpayers.

c) Instruct, urge taxpayers to declare and pay tax.

d) Implement measures for collection of tax debts and enforce payment of tax debts.

dd) Receive and process applications for tax deferral, tax payment in instalments, chargeoff, tax debt cancellation, exemption of late payment interest, cancellation of late payment interest.

e) Receive and process written requests for settlement of overpaid amounts of taxpayers in accordance with Article 25 and Article 26 of this Circular.

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h) Receive and process applications for tax exemption and reduction in accordance with Chapter VI of this Circular.

i) Carry out inspection and impose penalties for violations discovered on inspection (if any).

k) In case the taxpayer has to pay tax in multiple administrative divisions, the supervisory tax authority shall also have the following duties:

k.1) Determine whether the taxpayer is subject to tax obligation distribution as prescribed in Article 12, Article 13, Article 14, Article 15, Article 16, Article 17, Article 18, Article 19 of this Circular in order to provide instructions and urge the taxpayer to determine the amount of tax payable in each receiving province, submit the tax distribution sheet together with the tax declaration dossier to the supervisory tax authority; impose penalties for violations committed by the taxpayer against regulations of law on submission of tax declaration dossiers.

k.2) Calculate late payment interest, adjust late payment interest on the total amount of tax payable by the taxpayer (including the tax payable in the receiving province).

k.3) Instruct, urge taxpayers to declare and pay tax in the receiving province.

k.4) Preside over the implementation of measures for collection of tax debts, enforcement of tax debt payment in the receiving province; concurrently inform the tax authority of the receiving province in accordance with Point b Clause 6 Article 3 of this Circular for cooperation.

k.5) Preside over the receipt of applications for tax deferral, tax payment in instalments, chargeoff, tax cancellation in the receiving province; concurrently inform the tax authority of the receiving province in accordance with Point b Clause 6 Article 3 of this Circular for cooperation.

k.6) Preside over the receipt and processing of applications for exemption of late payment interest, cancellation of late payment interest on the tax debt in the receiving province.

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k.8) Preside over the receipt of applications for tax refund of taxpayers and cooperate with the tax authority of the receiving province specified in Point b Clause 6 Article 3 of this Circular in processing in accordance with Section 2 Chapter V of this Circular.

k.9) Preside over the receipt and processing of applications for tax exemption/reduction of the taxpayer in receiving province and cooperate with the tax authority of the receiving province specified in Point b Clause 6 Article 3 of this Circular in processing in accordance with Section 2 Chapter VI of this Circular.

k.10) Take charge and cooperate with the tax authority of the receiving province in carrying out inspection of the taxpayer’s entire business operation and imposing penalties for violations discovered on inspection (if any), including determination of tax payable in the receiving province.

k.11) Consolidate data and submit reports to the People’s Council and the People’s Committee on collection of state budget revenues, including all amounts paid to state budget and refunded to taxpayers in the administrative division, including the amounts payable by the taxpayers that are located within the administrative division but are under management of other supervisory tax authorities.

2. Tax authorities of the receiving provinces:

a) Supervise taxpayers declaring distribution of tax obligations and paying tax in the receiving province; request taxpayers to provide information and documents relevant to the distributed tax obligations; inform the supervisory tax authority in case a taxpayer fails to comply or fully comply with regulations on tax obligation distribution.

b) Implement certain measures for collection of tax debts, enforcement of tax debt payment in the receiving province and inform supervisory tax authorities (except tax authorities of the receiving provinces specified in Point a Clause 6 Article 3 of this Circular).

c) Cooperate in processing applications for tax deferral, tax payment in instalments, chargeoff, tax cancellation in the province at the request of supervisory tax authorities (except tax authorities of the receiving provinces specified in Point a Clause 6 Article 3 of this Circular).

d) Preside over or cooperate with supervisory tax authorities in offsetting overpaid tax in accordance with Article 25 and Article 26 of this Circular (except tax authorities of the receiving provinces specified in Point a Clause 6 Article 3 of this Circular).

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e) Cooperate in inspection of taxpayers at the request of supervisory tax authorities.

3. State budget revenue-managing tax authorities:

State budget revenue-managing tax authorities shall fully comply with regulations on tax administration of the Law on Tax Administration and its guiding documents (except the regulations of Clause 3 of this Article regarding the revenues under their management. To be specific:

a) Receive tax declaration dossiers, extend deadlines for submission of tax declaration dossiers and impose penalties for violations committed by taxpayers against regulations of law on submission of tax declaration dossiers regarding the revenues under their management.

b) Calculate, adjust late payment interest on the amounts receivable under their management. In the cases specified in Point b and Point c Clause 13 of this Circular, late payment interest shall be calculated and adjusted by the supervisory tax authority.

c) Instruct, urge taxpayers to declare and pay tax regarding the revenues under their management.

d) Implement measures for collection of tax debts and enforce payment of tax debts regarding the revenues under their management.

dd) Receive and process applications for tax deferral, exemption of late payment interest, cancellation of late payment interest regarding the revenues under their management prescribed in Article 22, Article 23 and Article 24 of this Circular.

e) Receive and process written requests for settlement of overpaid amounts of taxpayers regarding the revenues under their management in accordance with Article 25 and Article 26 of this Circular.

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h) Receive and process applications for refund of overpaid tax regarding the revenues under their management in accordance with Section 2 Chapter V of this Circular.

i) Receive and process applications for tax exemption and reduction of taxpayers regarding the revenues under their management in accordance with Chapter VI of this Circular.

k) Carry out inspection of taxpayers having revenues under their management and impose penalties for violations discovered on inspection (if any).

l) In case the taxpayer is subject to tax obligation distribution regarding the revenues specified in Point dd Clause 1 of Article 13, Article 15, Point d Clause 1 Article 17 of this Circular, the state budget revenue-managing tax authority shall also perform the duties of the supervisory tax authority according to Point k Clause 1 of this Article.

Chapter II

TAX ADVISORY COUNCILS OF COMMUNES

Article 6. Composition of the tax advisory council of a commune

1. A tax advisory council shall consist of:

a) The Chairperson or Deputy Chairperson of the People’s Committee of the commune: Chairperson of the Council;

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c) A finance official of the People’s Committee of the commune: member;

d) Chairperson of Fatherland Front Committee of the commune: member;

dd) Chief of the police department of the commune: member;

e) Chief of the neighborhood: member;

g) Chief of the market management board: member;

h) Representatives of local household businesses and individual businesses: members;

In case the district-level administrative division does not have any commune-level administrative division, the Chairperson of the People’s Committee of the district shall decide the establishment of the Tax Advisory Council whose members are conformable with regulations of this Clause.

2. The representatives of local household businesses and individual businesses that participate in the Tax Advisory Council shall:

a) Comply with business laws and tax laws;

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3. Maximum number of representatives of local household businesses and individual businesses that participate in the Tax Advisory Council shall be: 05 people. On the basis of the quantity and scale of local household businesses and individual businesses, the Chairperson of the People’s Committee of the district shall decide the quantity of their representatives.

Article 7. Establishment of a Tax Advisory Council

1. On the basis of the quantity and scale of local household businesses and individual businesses, the Chairperson of the People’s Committee of the district shall decide the establishment of Tax Advisory Councils of communes at the request of Directors of sub-departments of taxation.

2. A Tax Advisory Council may operate for up to 05 years.

3. A Tax Advisory Council may be re-established, add or replace its members in the following cases:

a) The Tax Advisory Council shall be re-established upon expiration of the 5-year period mentioned in Clause 2 of this Article.

b) Members of the Tax Advisory Council may be added or replaced in the following cases:

b.1) The composition of the Tax Advisory Council is no longer conformable with Clause 1 and Clause 2 Article 6 of this Circular;

b.2) Additional household businesses and individual businesses are needed to reach the required number or replace those that have stopped operating in the commune;

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4. Procedures for establishment of a Tax Advisory Council

a) The Fatherland Front Committee of the commune shall submit the list of proposed household businesses and individual businesses participating in the Tax Advisory Council to the sub-department of taxation. The sub-department of taxation shall provide information about these household businesses and individual businesses in order to facilitate selection by the Fatherland Front Committee of the commune.

b) On the basis of the composition and the list of participants in the Tax Advisory Council, the Director of the sub-department of taxation shall request the Chairperson of the People’s Committee of the district to issue the decision on establishment of the Tax Advisory Council (Form No. 07-1/HDTV in Appendix I hereof).

Article 8. Operation of the Tax Advisory Council

1. The Chairperson and members of the Tax Advisory Council shall work on a part-time basis. The Tax Advisory Council shall work directly under the leadership of the Chairperson of the Tax Advisory Council.

2. The Chairperson of the Tax Advisory Council shall convene meetings to seeks opinions of its members about the advisory contents. A meeting of the Tax Advisory Council shall be opened when it is chaired by its Chairperson and participated in by at least two thirds of the members (including the President). The Tax Advisory Council may seeks opinions of its members via electronic means. In case of disagreement among the members, a voting under the majority rule shall be held; in case of a tie, the Chairperson of the Tax Advisory Council shall have the casting vote.

3. Meetings of the Tax Advisory Council shall be recorded in writing according to Form No. 07-2/HDTV in Appendix I hereof. The minutes of meeting shall bear signatures of participating members. In case of electronic survey, the standing member shall prepare the minutes as if it was an in-person meeting.

Article 9. Working relationship between the Tax Advisory Council and tax authorities

1. Working relationship in seeking advice

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a.1) Documents requesting advice on revenue and estimated stable presumptive tax of household businesses and individual businesses paying presumptive tax:

a.1.1) List of estimated revenues and presumptive tax payable by household businesses and individual businesses according to Form No 07-3/HDTV in Appendix I hereof;

a.1.2) New legislative and instructional documents about the enquired issues (if any).

a.2) Documents requesting advice on revenue and adjusted presumptive tax of household businesses and individual businesses that made changes to business operation in the tax year:

a.2.1) List of household businesses and individual businesses whose information and tax are changed according to Form No. 07-4/HDTV in Appendix I hereof;

a.2.2) New legislative and instructional documents about the enquired issues (if any).

a.3) Documents requesting advice on management of tax payment by household businesses and individual businesses paying presumptive tax:

a.3.1) The plan for urging and managing household businesses and individual businesses paying presumptive tax in the administrative division according to requirements and instructions of the Department of Taxation and regulations of law;

a.3.2) Directive documents of the Department of Taxation and instructional documents relevant to the proposed issues.

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b.1) Advice of the Tax Advisory Council on adjustments to revenues and presumptive tax of the household businesses and individual businesses according to Form No. 07-5/HDTV and Form No. 07-6/HDTV in Appendix I hereof. This does not apply to requests for advice on the plan for management of household businesses and individual businesses paying presumptive tax.

b.2) The minutes of meeting of the Tax Advisory Council prepared according to Form No. 07-2/HDTV in Appendix I hereof.

2. Working relationship in responding to provided advice

In case the result of tax imposition, tax calculation or tax adjustment is contrary to the advice provided by the Tax Advisory Council, the sub-department of taxation shall send a written notice to the Tax Advisory Council according to Form No. 07-7/HDTV in Appendix I hereof concurrently with the publishing of the tax imposition results.

3. Working relationship in provision of information and documents

The sub-department of taxation shall provide and request inter-commune tax teams to provide information and documents for the Tax Advisory Council within the authority to which the Tax Advisory Council is entitled according to this Circular.

Article 10. Authority of a Tax Advisory Council

1. Be provided with training and documents about applicable tax policies on tax administration of household businesses and individual businesses;

2. Request the sub-department of taxation to provide information about collection of tax from local household businesses and individual businesses paying presumptive tax.

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1. Responsibility for providing advice on tax and tax administration

a) Provide advice on annual revenues and estimated stable presumptive tax of household businesses and individual businesses paying presumptive tax, including those whose revenues are not subject to VAT, personal income tax (PIT);

b) Provide advice on adjustment of tax payable by household businesses and individual businesses paying presumptive tax in case of changes to their business operation such as: change in scale, location, business lines, business suspension or termination in the tax year;

c) Cooperate with the sub-department of taxation in supervising and managing operation of local household businesses and individual businesses paying presumptive tax.

2. Responsibilities of the Chairperson of a Tax Advisory Council:

a) Decide the working plan of the Tax Advisory Council;

b) Invite delegates, summon members and chair meetings of the Tax Advisory Council;

c) Assign specific tasks to members of Tax Advisory Council;

d) Make decisions and assume overall responsibility for the operation of the Tax Advisory Council and its members during performance of their tasks;

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e) Sign documents on behalf of the Tax Advisory Council;

3. Responsibilities of members of a Tax Advisory Council:

a) Common responsibilities of members of a Tax Advisory Council:

a.1) Perform the tasks assigned by the President of the Tax Advisory Council and take responsibility to the President of the Tax Advisory Council for their performance;

a.2) Participate in all activities of the Tax Advisory Council;

a.3) Offer opinions at the meeting or in writing;

a.4) The member who can no longer participate in the Tax Advisory Council shall submit a written report to the President of the Council.

b) Responsibilities of standing member of a Tax Advisory Council:

b.1) Propose the working plan of the Tax Advisory Council and tasks of each member to the President of the Tax Advisory Council for consideration and decision;

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b.3) Report to the president of the Tax Advisory Council and the Director of the sub-department of taxation in case of change or replacement of a member of the Tax Advisory Council.

4. The Tax Advisory Council shall concurrently send its advice to the People’s Committee of the district, the People’s Committee of the commune and the sub-department of taxation.

Chapter III

TAX DECLARATION, TAX CALCULATION, DISTRIBUTION OF TAX OBLIGATIONS

Article 12. Distribution of tax obligations of taxpayers doing centralized accounting and having dependent units or business locations in multiple provinces

1. A taxpayer doing business in more than one province shall do centralized accounting in the province where the taxpayer is headquartered according to Clause 2 and Clause 4 Article 11 of Decree No. 126/2020/ND-CP , declare tax and submit tax declaration dossiers to the supervisory tax authority and distribute tax payable in each province where business is done.

2. Cases of distribution, methods for distribution, tax declaration, tax calculation, tax finalization are specified in Articles 13, 14, 15, 16, 17, 18, 19 of this Circular.

3. Taxpayers shall declare tax and distribute their tax obligations fully, accurately and promptly as per regulations. The total tax obligations distributed among the provinces shall not be greater than the tax payable specified in the tax declaration dossier. Distribution of tax obligations is not mandatory if tax is not incurred. This Clause does not apply to Point b and Point c Clause 2 Article 13 and Point b Clause 2 Article 17 of this Circular.

4. The taxpayer shall, on the basis of the tax payable in each province, prepare payment documents and pay tax to state budget as per regulations. The State Treasury that receives payment documents from the taxpayer shall specify the revenue of each province.

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6. In case of distribution VAT, CIT, resource royalty of hydroelectricity producers among multiple provinces, the Department of Taxation of the province where the hydropower plant's operating office is located shall, pursuant to Article 13, Article 15 and Article 17 of this Circular, cooperate with the investor of the hydropower plant and the Departments of Taxation of the provinces among which the hydropower plant or reservoir is shared in determining the ratios of distribution of taxes to each province. If a consensus between the Departments of Taxation and the taxpayer cannot be reached, the Department of Taxation of the province where the hydropower plant's operating office is located shall report to the Ministry of Finance (General Department of Taxation) for instructions.

Article 13. Declaring, calculating, distributing and paying VAT

1. Distribution cases:

a) Computerized lottery business;

b) Transfer of real estate, except the cases specified in Point b Clause 1 Article 11 of Decree No. 126/2020/ND-CP;

c) Construction activities according to regulations of law on national economic sector system and specialized laws;

d) Dependent units and business locations that are factories (including processing and assembly facilities, except the cases specified in Point c Clause 1 Article 11 of Decree No. 126/2020/ND-CP;

dd) A hydroelectric plant that is located in multiple provinces.

2. Distribution methods:

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VAT payable in each province where computerized lottery business takes place equals (=) VAT payable on computerized lottery business multiplied by (x) the ratio (%) of revenue on selling lottery tickets in each province to total revenue from selling lottery tickets of the taxpayer.

Revenue from selling computerized lottery tickets shall be determined as follows:

In case lottery tickets are distributed by means of terminal devices: Revenue from computerized lottery generated by registered terminal devices in each province shall be determined according to the lottery agent contracts with the computerized lottery company or ticket booths established by the taxpayer in the province.

In case lottery tickets are distributed by phone and internet: The revenue shall be determined in each province where the buyers register their lottery account in accordance with regulations of law on computerized lottery business.

b) Distribution of VAT on real estate transfer:

VAT payable in each province on real estate transfer equals (=) VAT-exclusive revenue from real estate transfer in the province multiplied by (x) 1%.

c) Distribution of VAT on construction activities:

VAT payable in each province on construction activities equals (=) VAT-exclusive revenue from construction activities in the province multiplied by (x) 1%.

VAT-exclusive revenue shall be determined according to the construction contract. In case the construction work or item is relevant to multiple provinces and the revenue generated in each province cannot be determined, after determining the 1% revenue, the taxpayer shall determine the VAT payable in each province according to the ratio (%) of investment in the construction work in each province to total investment.

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d.1) VAT payable in the province equals (=) VAT-exclusive revenue multiplied by 2% (for goods subject to 10% VAT) or 1% (for goods subject to 5% VAT), provided the total VAT payable in the provinces where the factories are located does not exceed the VAT payable in the province where the taxpayer is headquartered. In case the factory delivers or sells the products to other units of the same taxpayer, the revenue from the products shall be determined according to their production costs.

d.2) In case VAT payable in the provinces where the factories are located calculated according to Point d.1 is greater than VAT payable in the province where the taxpayer is headquartered, the taxpayer shall distribute VAT as follows: VAT payable in each province where the factory is located equals (=) VAT payable in the province where the taxpayer is headquartered multiplied by (x) ratio (%) of VAT-exclusive revenue from products manufactured in each province to total VAT-exclusive revenue from all products manufactured by the taxpayer.

d.3) Revenue as the basis for determination of distribution ratio mentioned in Point d.1 and Point d.2 of this Clause is the actual revenue generated in the tax period. In case of supplementary declaration that increases the revenue, the taxpayer shall re-distribute tax payable in each erroneous tax period in order to determine the difference in VAT distributed in each province.

dd) Distribution of VAT payable in each province where a hydroelectric plant is partially located:

VAT payable in each province where a hydroelectric plant is partially located equals (=) VAT payable on the hydroelectric plant multiplied by (x) the ratio (%) of investment in the part of the hydroelectric plant that is located in the province to the total investment in the hydroelectric plant.

3. Declaring and paying tax:

a) Computerized lottery business:

The taxpayer shall declare VAT on computerized lottery business nationwide and submit tax declaration dossiers according to Form No. 01/GTGT and the VAT distribution sheet according to Form No. 01-3/GTGT in Appendix II hereof to the supervisory tax authority; pay tax in the provinces where computerized lottery takes place in accordance with Clause 4 Article 12 of this Circular.

b) Real estate transfer:

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b.2) The taxpayer shall include the VAT-exclusive revenue from real estate transfer in the tax declaration dossier prepared at the headquarters in order to determine the VAT payable on the entire business operation at the headquarters. The VAT paid in the province where the transferred real estate is located shall be offset against the VAT payable in the headquarters' province.

c) Construction activities:

c.1) In case the taxpayer is a construction contractor that directly signs the contract with the investor for construction of the work in a province other than the province in which the taxpayer is headquartered, including construction works and items that are relevant to multiple provinces, the taxpayer shall declare VAT on these construction works and items at the tax authority of the area where the construction work is located according to Form No. 05/GTGT in Appendix II hereof; submit the declared tax in the province where the construction work is located. In case the State Treasury has carried out deduction as prescribed in Clause 5 of this Article, the taxpayer is not required to pay the amount deducted by State Treasury to state budget.

c.2) The taxpayer shall include the VAT-exclusive revenue from construction activities in the tax declaration dossier prepared at the headquarters in order to determine the VAT payable on the entire business operation at the headquarters. The VAT paid in the province where construction work is located shall be offset against the VAT payable in the headquarters' province.

d) In case of dependent units and business locations that are factories:

The taxpayer shall declare VAT on business operation of the dependent units and business locations that are factories and submit tax declaration dossiers according to Form No. 01/GTGT and the VAT distribution sheet according to Form No. 01-6/GTGT in Appendix II hereof to the supervisory tax authority; pay tax in the provinces where the factories are located in accordance with Clause 4 Article 12 of this Circular.

dd) In case of a hydroelectric plant that is located in multiple provinces:

The taxpayer shall declare VAT incurred by the hydroelectric plant and submit tax declaration dossiers according to Form No. 01/GTGT and the VAT distribution sheet according to Form No. 01-2/GTGT in Appendix II hereof to the tax authority of the area where the hydroelectric plant's operating office is located; pay tax in the provinces where the hydroelectric plant is located in accordance with Clause 4 Article 12 of this Circular.

4. In case a dependent unit directly sells goods, uses invoices registered by the dependent unit or the taxpayer to the supervisory tax authority of the dependent unit, fully records input and output VAT, the dependent unit shall declare and pay VAT to its supervisory tax authority.

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a) The State Treasury where the investor opens the transaction account shall deduct VAT payable to state budget, which equals (=) 1% of the VAT-exclusive revenue from the volume of completed capital construction works and items, except the cases specified in Point b of this Clause.

b) State Treasury shall not deduct VAT in the following cases:

b.1) The investor is following procedures for advancement of capital construction investment as per regulations.

b.2) Reimbursements for capital construction investment in project management tasks: payment for project management tasks directly performed by the investors; expenditures of the project management board, expenditures land clearance, expenditures on private projects.

b.3) Construction costs of the projects and works covered by commune budget with the total investment of under 01 billion VND.

b.4) The taxpayer has proven the full payment of tax to state budget.

c) When making payment at State Treasury, the investor shall prepare payment documents according to the form provided in the Government’s Decree No. 11/2020/ND-CP and send them to State Treasury for VAT deduction. The VAT deducted by State Treasury on the payment documents shall be deducted from the VAT payable by the investor. The investor shall provide payment documents for the contractors whose tax has been deducted by State Treasury.

d) VAT deducted by State Treasury shall be recorded as State budget revenues of the province in which the capital construction is located.

In case the construction work is located in multiple provinces, the investor shall determine the VAT-exclusive revenue earned in each province, prepare payment documents according to the form in Decree No. 11/2020/ND-CP, and send them to State Treasury for VAT deduction and recording state budget revenues of each province. In case revenue of the construction work in each province cannot be determined, after calculating the 1% of VAT-exclusive revenue, VAT payable in each province shall be determined on the basis of the ratio of investment in the construction work in each province to the total investment. In case the construction work is located within a province but more than one district or in a district that is different from the district in which the contractor is headquartered, the Department of Taxation shall cooperate with the Provincial Department of Finance in advising the People’s Council and the People’s Committee of the province distributing state budget revenues among the districts.

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Article 14. Declaring, calculating, distributing and paying excise tax

1. Distribution cases:

Computerized lottery business.

2. Distribution methods:

Excise tax payable in each province where computerized lottery business takes place equals (=) excise tax payable on computerized lottery business multiplied by (x) the ratio (%) of revenue on selling lottery tickets in each province to total revenue from selling lottery tickets of the taxpayer.

Revenue from selling computerized lottery tickets shall be determined in accordance with Point a Clause 2 Article 13 of this Circular.

3. Declaring and paying tax:

The taxpayer shall declare excise tax on computerized lottery business nationwide and submit tax declaration dossiers according to Form No. 01/TTDB, the Form No. 01-2/TTDB on deductible excise tax on purchased materials and imports (if any), and the VAT distribution sheet according to Form No. 01-3/TTDB in Appendix II hereof to the supervisory tax authority; pay tax in the provinces where computerized lottery takes place in accordance with Clause 4 Article 12 of this Circular.

Article 15. Declaring, calculating, distributing and paying resource royalty

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Hydropower generation with a reservoir that is located in multiple provinces.

2. Distribution methods:

a) Basis for distribution of resource royalty payable in each province:

a.1) The total area of the reservoir is t; the area of the reservoir in Province G is t.1; the area of the reservoir in Province H is t.2.

The ratio (%) of reservoir area in Province G is T.1 = t.1/t x 100.

The ratio (%) of reservoir area in Province H is T.2 = t.2/t x 100.

a.2) The cost of land clearance and relocation is k; the cost of land clearance and relocation in Province G is k.1; the cost of land clearance and relocation in Province H is k.2.

The ratio (%) of cost of land clearance and relocation in Province G is K.1 = k.1/k x 100.

The ratio (%) of cost of land clearance and relocation in Province H is K.2 = k.2/k x 100.

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The ratio (%) of quantity of relocated households is s; the quantity of relocated households in Province G is S.1 = s.1/s x 100.

The ratio (%) of quantity of relocated households is s; the quantity of relocated households in Province H is S.2 = s.2/s x 100.

a.4) The total compensation is v; the compensation in Province G is v.1; the compensation in Province H is v.2.

The ratio (%) of compensation in Province G is V.1 = v.1/v x 100.

The ratio (%) of compensation in Province H is V.2 = v.2/v x 100.

b) Formula:

Resource royalty payable in Province G

=

T.1 + K.1 + S.1 + V.1

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4

Resource royalty payable in Province H

=

T.2 + K.2 + S.2 + V.2

x Resource royalty payable

4

3. Declaring, paying resource royalty:

The taxpayer that has a hydroelectric plant shall declare resource royalty and submit tax declaration dossiers according to Form No. 01/TAIN and tax finalization dossiers according to Form No. 02/TAIN to the state budget revenue-managing tax authority of the area where water extraction takes place. In case the reservoir of the hydroelectric plant is located in multiple province, submit the resource royalty declaration dossier according to Form No. 01/TAIN, the resource royalty finalization dossier according to Form No. 02/TAIN and the resource royalty distribution sheet according to Form No. 01-1/TAIN in Appendix II hereof to the tax authority where the hydroelectric plant's operating office is located; pay resource royalty in the provinces where the hydroelectric reservoir is located in accordance with Clause 4 Article 12 of this Circular.

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1. Distribution cases:

a) Oil and gas in the cases specified in Point a.2 Clause 4 Article 11 of Decree No. 126/2020/ND-CP;

b) Coal extracted and sold domestically in the cases specified in Point b Clause 4 Article 11 of Decree No. 126/2020/ND-CP.

2. Distribution methods:

a) Distribution of environment protection tax on oil and gas;

Environment protection tax payable in each province where a dependent unit is located equals (=) environment protection tax payable in each province on each petroleum product. 

Environment protection tax payable in each province on each petroleum product equals (=) environment protection tax payable on each petroleum product multiplied by (x) the ratio (%) of quantity of each petroleum product which is subject to environment protection tax sold by the dependent unit to total quantity of petroleum product which is subject to environment protection tax sold by the taxpayer.

b) Distribution of environment protection tax on coal extracted and sold domestically:

Environment protection tax payable in each province where the coal extraction company is located shall be determined as follows:

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=

Domestic coal consumption in the period

Total coal consumption in the period

Resource royalty payable in provinces where coal is extracted

=

Percentage (%) of domestic coal consumption in the period

X

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X

Fixed tax on 1 tonne of coal consumed

3. Declaring and paying tax:

a) Oil and gas:

In case dependent units or subsidiary companies of the wholesaler do business in provinces other than the provinces in which the wholesaler and subsidiary company of the wholesaler are headquartered and do not do accounting separately, the wholesaler and the subsidiary companies of the wholesaler shall declare environment protection tax and submit the tax declaration dossier according to Form No. 01/TBVMT, the environment protection tax distribution sheet according to Form No. 01-2/TBVMT in Appendix II hereof to the supervisory tax authorities; pay tax in the provinces where the dependent units are located in accordance with Clause 4 Article 12 of this Circular.

b) Distribution of environment protection tax on coal extracted and sold domestically:

In case an enterprise that extracts and sells coal domestically by assigning the extraction, processing and sale to its subsidiary companies or dependent units, the units assigned to sell coal shall declare environment protection tax on the entire amount of coal extracted and submit the tax declaration dossier according to Form No. 01/TBVMT, the environment protection tax distribution sheet according to Form No. 01-2/TBVMT in Appendix II hereof to the supervisory tax authority; pay tax in the province where the coal extraction company is located in accordance with Clause 4 Article 12 of this Circular.

Article 17. Declaring, calculating, finalizing, distributing and paying corporate income tax (CIT)

1. Distribution cases:

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b) Real estate transfer;

c) Dependent units and business locations that are factories;

d) A hydroelectric plant that is located in multiple provinces.

2. Distribution methods:

a) Distribution of CIT on computerized lottery business:

CIT payable in each province where computerized lottery business takes place equals (=) CIT payable on computerized lottery business multiplied by (x) the ratio (%) of revenue on selling lottery tickets in each province to total revenue from selling lottery tickets of the taxpayer.

Revenue from selling computerized lottery tickets shall be determined in accordance with Point a Clause 2 Article 13 of this Circular.

b) Distribution of CIT on real estate transfer:

Quarterly and finalized CIT payable in each province where real estate transfer takes place equals (=) revenue subject to CIT from real estate transfer in the province multiplied by (x) 1%.

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CIT payable in each province where a factory is located equals (=) CIT on business operation multiplied by (x) the ratio (%) of cost of each factory to total cost of the taxpayer (excluding costs of operations eligible for CIT incentives. The costs as the basis for distribution shall be actual costs incurred in the tax period.

CIT on business operation does not include CIT on operations eligible for CIT incentives. CIT on operations eligible for CIT incentives shall be determined according to the performance of these operations and the level of incentives for which they are eligible.

d) Distribution of CIT in case a hydroelectric plant is located in multiple provinces:

CIT on the entire hydroelectric plant equals (=) CIT on business operation multiplied by (x) the ratio (%) of cost of each plant to total cost of the taxpayer (excluding costs of operations eligible for CIT incentives. The costs as the basis for distribution shall be actual costs incurred in the tax period. CIT on business operation does not include CIT on operations eligible for CIT incentives.

After determining CIT on the entire hydroelectric plant, the CIT payable in each province equals (=) CIT on the entire hydroelectric plant multiplied by (x) the ratio (%) of investment in the part of the hydroelectric plant that is located in the province to the total investment in the hydroelectric plant.

3. Declaring, finalizing, paying tax:

a) Computerized lottery business:

a.1) Declaring, paying provisional tax quarterly:

The taxpayer is not required to submit tax declaration dossiers quarterly but have to pay provisional tax quarterly in each province where computerized lottery business takes place according to Point b Clause 6 Article 8 of Decree No. 126/2020/ND-CP.

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The taxpayer shall finalize CIT on the entire computerized lottery business according to Form No. 03/TNDN, submit the CIT distribution sheet according to Form No. 03-8C/TNDN in Appendix II hereof to the supervisory tax authority; pay CIT in the provinces where computerized lottery business takes place in accordance with Clause 4 Article 12 of this Circular.

In case the paid provisional CIT is smaller than the finalized CIT payable in each province, the taxpayer shall pay the CIT arrears in the provinces. In case the paid provisional CIT is greater than the CIT payable, the overpaid CIT shall be handled in accordance with Article 60 of the Law on Tax Administration and Article 25 of this Circular.

b) Real estate transfer:

b.1) Declaring, paying provisional tax quarterly:

The taxpayer is not required to submit tax declaration dossiers quarterly but have pay provision tax quarterly according to Point b Clause 2 of this Article in the provinces where real estate transfer takes place.

b.2) Tax finalization:

The taxpayer shall finalize CIT on every real estate transfer according to Form No. 03/TNDN, determine the CIT payable in each province according to Point b Clause 2 of this Article in the CIT distribution sheet, which is prepared according to Form No. 03-8A/TNDN in Appendix II hereof to the supervisory tax authority; pay CIT in the provinces where real estate transfer takes place in accordance with Clause 4 Article 12 of this Circular.

Paid provisional tax in the provinces (excluding provisional tax paid on behalf of enterprises executing infrastructure, housing projects for transfer or lease purchase with collection of advances from buyers which are yet to be included in revenue subject to CIT in the year) shall be deducted from the CIT on real estate transfer payable in each province specified in Form No. 03-8A/TNDN in Appendix II hereof. The remainder (if any) shall be deducted from the finalized CIT on real estate transfer at the headquarters, which is specified in Form No. 03/TNDN in Appendix II hereof.

In case the paid provisional CIT is smaller than the finalized CIT specified in Form No. 03/TNDN in Appendix II hereof, the taxpayer shall pay the CIT arrears in the province where the taxpayer is headquartered. In case the paid provisional CIT is greater than the CIT payable, the overpaid CIT shall be handled in accordance with Article 60 of the Law on Tax Administration and Article 25 of this Circular.

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c.1) Declaring, paying provisional tax quarterly:

The taxpayer is not required to submit tax declaration dossiers quarterly but have to pay provisional tax quarterly in the provinces where the factories are located, including those with units eligible for CIT incentives, in accordance with Point b Clause 6 Article 8 of Decree No. 126/2020/ND-CP.

c.2) Tax finalization:

The taxpayer shall finalize CIT on the entire business operation of the taxpayer according to Form No. 03/TNDN, submit the CIT distribution sheet according to Form No. 03-8/TNDN in Appendix II hereof to the supervisory tax authority; pay CIT in the provinces where the factories are located in accordance with Clause 4 Article 12 of this Circular.

For activities that are eligible for CIT incentives, the taxpayer shall submit tax finalization form No. 03/TNDN in Appendix II hereof to the supervisory tax authority, determine CIT on the activities that are eligible for CIT incentives according to Form No. 03-3A/TNDN, 03-3B/TNDN, 03-3C/TNDN, 03-3D/TNDN in Appendix II hereof and submit them to the supervisory tax authority and tax authorities of the areas where the units eligible for incentives are located.

In case the paid provisional CIT is smaller than the finalized CIT payable in each province, the taxpayer shall pay the CIT arrears in the provinces. In case the paid provisional CIT is greater than the CIT payable in each province, the overpaid CIT shall be handled in accordance with Article 60 of the Law on Tax Administration and Article 25 of this Circular.

d) In case of a hydroelectric plant that is located in multiple provinces:

d.1) Declaring, paying provisional tax quarterly:

The taxpayer is not required to submit tax declaration dossiers quarterly but have to quarterly determine and pay provisional tax payable in each province where the hydroelectric plant is located according to Point b Clause 6 Article 8 of Decree No. 126/2020/ND-CP.

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The taxpayer shall finalize CIT on the entire business operation of the taxpayer according to Form No. 03/TNDN, submit the CIT distribution sheet according to Form No. 03-8/TNDN and Form No. 03-8B/TNDN in Appendix II hereof to the supervisory tax authority; pay CIT in the provinces where the hydroelectric plant is located in accordance with Clause 4 Article 12 of this Circular.

In case the paid provisional CIT is smaller than the finalized CIT payable in each province, the taxpayer shall pay the CIT arrears in the provinces. In case the paid provisional CIT is greater than the CIT payable in each province, the overpaid CIT shall be handled in accordance with Article 60 of the Law on Tax Administration and Article 25 of this Circular.

4. In case revenues, costs and taxable income of a corporation's subsidiary can be determined, the subsidiary shall declare and pay PIT to its supervisory tax authority.

5. In case a subsidiary's business operation is different from that of the corporation and is able to determine revenue from such business operation, the subsidiary shall declare and pay CIT to its supervisory tax authority.

Article 18. Declaring, calculating, finalizing, distributing and paying remaining post-tax profit after making fund contributions

1. Distribution cases:

Computerized lottery business.

2. Distribution methods:

Remaining post-tax profit after making fund contributions in each province where computerized lottery business takes place equals (=)Remaining post-tax profit from computerized lottery business after making fund contributions multiplied by (x) the ratio (%) of revenue on selling lottery tickets in each province to total revenue from selling lottery tickets of the taxpayer.

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3. Declaration and payment:

a) Quarterly declaration and payment of provisional post-tax profit

The taxpayer is not required to submit tax declaration dossiers quarterly but have to quarterly determine and pay provisional remaining post-tax profit from computerized lottery business after making fund contributions payable in each province where computerized lottery business takes place according to Point c Clause 6 Article 8 of Decree No. 126/2020/ND-CP.

b) Tax finalization:

The taxpayer shall finalize the remaining post-tax profit from computerized lottery business after making fund contributions payable nationwide and submit the declaration dossier according to Form No. 01/QT-LNCL, the distribution sheet according to Form No. 01-1/QT-LNCL in Appendix II hereof to the supervisory tax authority; pay the distributable amount in the provinces where computerized lottery business takes place in accordance with Clause 4 Article 12 of this Circular.

In case the paid provisional amount is smaller than the finalized amount payable in each province, the taxpayer shall pay the arrears in the provinces. In case the paid provisional CIT is greater than the CIT payable in each province, the overpaid CIT shall be handled in accordance with Article 60 of the Law on Tax Administration and Article 25 of this Circular.

Article 19. Declaring, calculating, distributing and paying personal income tax (PIT)

1. Distribution methods:

a) Deduction of PIT on income from salaries and remunerations paid at the headquarters to employees working at dependent units or business locations in other provinces.

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2. Distribution methods:

a) Distribution of PIT on income from salaries and remunerations:

The taxpayer shall determine the PIT on salaries and remunerations of individuals working in each province according to the PIT deducted in reality from income of each individual. In case an employee is reassigned or seconded, PIT shall be paid in the province in which the employee is working at the time of income payment.

b) Distribution of PIT on individuals' income from computerized lottery prizes:

The taxpayer shall determine the PIT on income from computerized lottery prizes earned by the individual in each province where the individual participates by phone or internet and the where computerized lottery tickets are issue via terminal devices according to the PIT deducted in reality.

3. Declaring and paying tax:

a) PIT on income from salaries and remunerations:

a.1) The taxpayer that pays salaries and remunerations to employees who work at dependent units and business locations in provinces other than the province where the taxpayer is headquartered shall deduct PIT from salaries and remunerations, submit tax declaration dossiers according to Form No. 05/KK-TNCN, the PIT distribution sheet according to Form No. 05-1/PBT-KK-TNCN in Appendix II hereof to the supervisory tax authority; pay PIT in the provinces where the employees work in accordance with Clause 4 Article 12 of this Circular. PIT payable in each province shall be determined monthly or quarterly and shall not be adjusted during PIT finalization.

a.2) Individuals who earn income from salaries and remunerations and have to declare tax directly to tax authorities include: resident individuals whose salaries and remunerations are paid from foreign countries; non-resident individuals whose salaries and remunerations are earned in Vietnam but paid from foreign countries; individuals whose salaries and remunerations are paid by international organizations, Embassies, Consulates in Vietnam but PIT has not been deducted; individuals receiving bonus shares from paying organizations.

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The taxpayer is the income payer that deducts PIT from the individual's prize, submit the PIT declaration dossier according to Form No. 06/TNCN, the PIT distribution sheet according to Form No. 05-1/PBT-KK-TNCN in Appendix II hereof to the supervisory tax authority; pay PIT in the provinces where individual participates in computerized lottery by phone or internet and where computerized lottery tickets are distributed via terminal devices according to Clause 4 Article 12 of this Circular.

Article 20. Declaration forms, appendices and relevant documents in the tax declaration dossier

The tax form, appendices; additional declaration; registration of dependants; PIT declaration authorization form; report on estimated petroleum production and provisional tax rate; declaration of increase in tax declared monthly compared to quarterly declared tax; application for conversion from monthly declaration to quarterly declaration of taxes and other state budget revenues are provided in Appendix II hereof.

Chapter IV

SETTLEMENT OF TAX, LATE PAYMENT INTEREST, FINES

Article 21. Settlement of late tax payment

1. Determination of late payment interest

Late payment interest shall be determined according to the tax arrears, the number of days of late payment, and the interest rate specified in Article 59 of the Law on Tax Administration. Late payment period begins on the day succeeding the day on which late payment interest is charged and ends on the day preceding the day on which tax arrears are paid to state budget.

2. Notification of late payment interest

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In order to complete administrative procedures for taxpayers or at the request of competent authorities, the tax authority shall determine and notify tax debt that accumulates by the time the tax authority issues the notification (according to Form No. 02/TTN in Appendix I hereof).

3. Decreasing late payment interest

a) In case the taxpayer makes a supplementary declaration that decreases tax obligations, the taxpayer shall determine the decreased late payment interest on the supplementary declaration. The tax authority shall determine the decreased late payment interest on the basis of information about the taxpayer's obligations and send a notification to the taxpayer according to Form No. 03/TTN in Appendix I hereof.

b) In case the tax authority or a competent authority, upon inspection, discovers that the tax payable is decreased or issues a decision on or notification of decrease in tax payable, the tax authority shall decrease the late payment interest in proportion to the decrease in tax payable and send a notification to the taxpayer according to Form No. 03/TTN in Appendix I hereof.

Article 22. Procedures and application for cancellation of late payment interest

1. The period over which late payment interest is not charged in the cases specified in Point a Clause 5 Article 59 of the Law on Tax Administration begins on the day on which payment to the taxpayer by the state budget is due to the day on which the taxpayer is paid by the state budget user.

2. Procedures for cancellation of late payment interest in the cases specified in Point a Clause 5 Article 59 of the Law on Tax Administration:

a) Procedures

a.1) The taxpayer shall prepare the application for cancellation of late payment interest and send it to the supervisory tax authority or the state budget revenue-managing tax authority.

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In case the application for cancellation of late payment interest is satisfactory, within 10 working days from the receipt of the application, the tax authority shall decide whether to send a notification of cancelled late payment interest (Form No. 04/KTCN in Appendix I hereof) if the taxpayer is eligible, or send a notification of rejected application (Form No. 05/KTCN in Appendix I hereof) if the taxpayer is not eligible.

b) The application for cancellation of late payment interest shall contain:

b.1) The application form No. 01/KTCN in Appendix I hereof;

b.2) Written state budget user's confirmation that the taxpayer has not received the payment according to Form No. 02/KTCN in Appendix I hereof (original copy or certified true copy);

b.3) The contract for provision of goods and/or services with the investor (original copy or copy certified by the taxpayer).

3. Responsibilities of the taxpayer and relevant authorities

a) The taxpayer shall pay tax debt to state budget by the working day succeeding the day on which the state budget user pays the taxpayer and sends a notification to the tax authority according to Form No. 03/KTCN in Appendix I hereof.

b) The state budget user shall confirm the status of payment to the taxpayer and take legal responsibility for such confirmation.

c) The tax authority shall supervise the taxpayer's fulfillment of their tax obligations.

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Article 23. Procedures and application for exemption of late payment interest

1. Procedures for processing an application for exemption of late payment interest in the cases specified in Clause 8 Article 59 of the Law on Tax Administration:

a) The taxpayer shall prepare the application for exemption of late payment interest and send it to the state budget revenue-managing tax authority.

b) In case the application for exemption of late payment interest is not satisfactory, within 03 working days from the receipt of the application, the tax authority shall send a notification to the taxpayer according to Form No. 01/TB-BSTT-NNT enclosed with Decree No. 126/2020/ND-CP and request the taxpayer to provide explanation or supplement the application.

In case the application for exemption of late payment interest is satisfactory, within 10 working days from the receipt of the application, the tax authority shall decide whether to send a notification of exempted late payment interest (Form No. 03/MTCN in Appendix I hereof) if the taxpayer is eligible, or send a notification of rejected application (Form No. 02/MTCN in Appendix I hereof) if the taxpayer is not eligible.

2. The application for exemption of late payment interest:

a) In case of a natural disaster, epidemic, conflagration or accident, the application shall contain:

a.1) The application form No. 01/MTCN in Appendix I hereof;

a.2) Documents issued by competent authorities confirming the time, location of the natural disaster, epidemic, conflagration or accident (original copies or copies certified by the taxpayer);

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a.4) Documents (original copies or copies certified by the taxpayer) attributing responsibility of specific organizations and individuals for paying compensation (if any);

a.5) Documents (original copies or copies certified by the taxpayer) relevant to payment of compensation (if any).

b) In other force majeure events specified in Clause 1 Article 3 of Decree No. 126/2020/ND-CP, the application shall contain:

b.1) The application form No. 01/MTCN in Appendix I hereof;

b.2) Documents determining physical damage issued by a financial authority or an independent assessing authority (original copies or certified true copies) inflicted by the war, riot, strike that caused the taxpayer to suspend or terminate business operation;

b.3) Documents proving that the risk is not subjectively caused by the taxpayer and that the taxpayer is not financially capable of making payment to state budget if that is the case (original copies or certified true copies).

b.4) Documents (original copies or copies certified by the taxpayer) relevant to insurance payout provided by the insurer (if any).

3. Determination of exempted late payment interest

a) In case of a natural disaster, epidemic, conflagration or accident mentioned in Point a Clause 27 Article 3 of the Law on Tax Administration, the exempted late payment interest shall be the unpaid late payment interest upon the occurrence of such event and must not exceed the physical damage minus compensation and insurance payout (if any).

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4. Authority to issue decisions on exemption of late payment interest

Heads of supervisory tax authorities or state budget revenue-managing tax authority shall issue decisions on exemption of late payment interest according to Form No. 04/MTCN in Appendix I hereof.

Article 24. Procedures and application for tax deferral

1. Procedures for processing an application for tax deferral in the cases specified in Article 62 of the Law on Tax Administration:

a) The taxpayer shall prepare the application for tax deferral and send it to the supervisory tax authority or the state budget revenue-managing tax authority.

b) In case the application for tax deferral is not satisfactory, the value of physical damage determined by the taxpayer and specified in the application is suspicious, or there are other errors, within 03 working days from the receipt of the application, the tax authority shall send a notification to the taxpayer according to Form No. 01/TB-BSTT-NNT enclosed with Decree No. 126/2020/ND-CP and request the taxpayer to provide explanation or supplement the application.

In case the application for tax deferral is satisfactory, within 10 working days from the receipt of the application, the tax authority shall decide whether to send the decision on tax deferral (Form No. 02/GHAN in Appendix I hereof) if the taxpayer is eligible, or send a notification of rejected application (Form No. 03/GHAN in Appendix I hereof) if the taxpayer is not eligible.

2. Composition of an application for tax deferral

a) In case of a natural disaster, epidemic, conflagration or accident specified in Point a Clause 27 Article 3 of the Law on Tax Administration, the application shall contain:

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a.2) Documents issued by competent authorities confirming the time, location of the natural disaster, epidemic, conflagration or accident (original copies or copies certified by the taxpayer);

a.3) Documents about physical damage determined by the taxpayer or the taxpayer's legal representative, who is responsible for the accuracy of the physical damage determined;

a.4) Documents (original copies or copies certified by the taxpayer) attributing responsibility of specific organizations and individuals for paying compensation (if any);

a.5) Documents (original copies or copies certified by the taxpayer) relevant to payment of compensation (if any).

b) In other force majeure events specified in Clause 1 Article 3 of Decree No. 126/2020/ND-CP, the application shall contain:

b.1) The application form No. 01/GHAN in Appendix I hereof;

b.2) Documents about physical damage determined by the taxpayer or the taxpayer's legal representative, who is responsible for the accuracy of the physical damage determined;

b.3) Documents confirming the time and location of the force majeure event issued by competent authorities; documents proving that business suspension or shutdown is caused by the war, riot, strike (original copies or copies certified by the taxpayer);

b.4) Documents proving that the risk is not subjectively caused by the taxpayer and that the taxpayer is not financially capable of making payment to state budget if that is the case (original copies or certified true copies).

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c) In case of relocation of the business establishment specified in Point b Clause 1 Article 62 of the Law on Tax Administration, the application shall contain:

c.1) The application form No. 01/GHAN in Appendix I hereof;

c.2) The decision on relocation of the business establishment issued by a competent authority (original copy or copy certified by the taxpayer);

c.3) The relocation scheme or plan which specifies the taxpayer's plan and schedule for relocation (original copy or copy certified by the taxpayer).

3. Determination of deferred amount

a) In case of a natural disaster, epidemic, conflagration or accident mentioned in Point a Clause 27 Article 3 of the Law on Tax Administration, the deferred amount is the tax debt that has accumulated by the date of occurrence of the natural disaster, epidemic, conflagration or and must not exceed the physical damage minus compensation and insurance payout (if any).

b) In case of other force majeure events mentioned in Clause 1 Article 3 of Decree No. 126/2020/ND-CP , the deferred amount shall be the tax debt that has accumulated by the date of the occurrence of such event and must not exceed the physical damage minus compensation and insurance payout (if any).

c) In case of relocation specified in Point b Clause 1 Article 62 of the Law on Tax Administration, the deferred amount shall be the tax debt that has accumulated by the day on which business operation is suspended for relocation but must not exceed the relocation costs and damage caused by the relocation minus compensation and insurance payout as per regulations. Relocation costs do not include the costs of construction of the new business establishment. In case a competent authority discovers that the relocation does not happen, the taxpayer shall pay the deferred amount and late payment interest on the deferred amount.

Article 25. Settlement of overpaid tax, late payment interest and fines

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a) Offsetting against the outstanding tax, late payment interest, fines (hereinafter referred to as "debts") or offset against tax, late payment interest, fines payable next time (hereinafter referred to as "new amounts payable") in the following cases:

a.1) Offset against the taxpayer's debts that belong to the same category and area as those of the overpaid amount.

a.2) Offset against the taxpayer's new amount payables that belong to the same category and area as those of the overpaid amount.

a.3) The income payer that has the overpaid PIT shall offset it in accordance with Point a.1 and Point a.2 of this Clause. Overpaid PIT equals (=) overpaid PIT of the authorizing individual minus (-) PIT payable of the authorizing individual; the income payer shall return the overpaid PIT to the authorizing individual when it finalizes PIT.

a.4) Offset against another taxpayer's debts or new amount payables that belong to the same category and area as those of the overpaid amount if the current taxpayer has no more debt.

a.5) In case the taxpayer's overpaid amount is in a foreign currency as prescribed in Article 4 of this Circular, it shall be converted into VND at the selling rate at the beginning of the day quoted by Vietcombank on the day on which overpaid tax is determined.

b) Refund, refund combined with budget offsetting

In case the overpaid amount cannot be completely offset according to Point a of this Clause or the taxpayer does not have any debt, the taxpayer may submit an application for refund or refund combined with state budget offsetting in accordance with Article 42 of this Circular. The overpaid amount will be refunded when the taxpayer has no debt.

c) Date of determination of overpaid amount for offsetting or refund:

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c.2) If the taxpayer calculate, declare and pay the declared tax themselves, the date of determination of overpaid amount shall be the day on which tax is paid to state budget; In case the taxpayer pays tax before submitting the tax declaration dossier, it shall be the day on which the tax declaration dossier is submitted. In case of supplementation of the tax declaration dossier, it shall be the date the supplementary documents are submitted.

c.3) If the taxpayer pays tax according to a decision issued by the tax authority, a decision or document issued by a competent authority, the date of determination of overpaid amount shall be the day on which tax is paid to state budget; In case the taxpayer pays tax before the decision or document is issued, it shall be the issuance date of the decision or document. In case of multiple decisions or documents, it shall be the issuance date of the last decision or document.

c.4) In case the taxpayer has paid tax before having to implement a court's judgment or decision, the date of determination of overpaid amount shall be the effective date of the court's judgment or decision.

2. Procedures for offsetting overpaid tax, late payment interest and fines

a) The taxpayer who has an overpaid amount to be offset against debts or new amounts payable according to Point a.1, Point a.2, Point a.3 Clause 1 of this Article is not required to submit the application for offsetting to the tax authority. The tax authority shall automatically offset the overpaid amount on the tax administration system in the cases specified in Point a.1, Point a.2 Clause 1 of this Article and provide information for the taxpayer in accordance with Article 69 of this Circular.

b) The taxpayer who has an overpaid amount to be offset against debts or new amounts payable according to Point a.4 Clause 1 of this Article shall submit an application which shall contain: the application form No. 01/DNXLNT in Appendix I hereof and relevant documents to the tax authority specified in Clause 3 of this Article.

c) The tax authority shall receive and process the taxpayer's application for offsetting in accordance with Clause 3 of this Article. Within 05 working days from the receipt of the satisfactory application, the tax authority shall compare the overpaid amount, debts and new amounts payable specified in the taxpayer's application with those on the tax administration system:

c.1) If the information matches, the tax authority shall offset the overpaid amount against the debts and new amounts payable as requested by the taxpayer and send a notification to the taxpayer according to Form No. 01/TB-XLBT in Appendix I hereof.

c.2) If the taxpayer is not eligible for offsetting as prescribed in Clause 1 of this Article, the tax authority shall send a notification to the taxpayer according to Form No. 01/TB-XLBT in Appendix I hereof and provide explanation.

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If the taxpayer fails to provide explanation or supplementary documents by the deadline imposed by the tax authority or information in the taxpayer's application does not match information on the tax administration system, the tax authority shall send the taxpayer a notification according to Form No. 01/TB-XLBT in Appendix I hereof and provide explanation for not offsetting the overpaid amount.

3. Authority to offset overpaid amounts

a) Supervisory tax authorities shall:

a.1) Offset the overpaid amount against the debts and new amounts payable of taxpayers under their management in the cases specified in Point a.1 and Point a.2 Clause 1 of this Article.

a.2) Receive, process applications for settlement of taxpayers' overpaid amounts in the cases specified in Point a.4 Clause 1 of this Article that are collected by supervisory tax authorities or managed by tax authorities of the receiving provinces according to Point b Clause 6 Article 3 of this Circular.

b) State budget revenue-managing tax authorities shall:

b.1) Offset on the tax administration system the overpaid amounts of the taxpayers under their management in the cases specified in Point a.1 and Point a.2 Clause 1 of this Article.

b.2) Receive, process applications for settlement of taxpayers' overpaid amounts in the cases specified in Point a.4 Clause 1 of this Article that are under their management.

c) The tax authority of the receiving province prescribed in Point b Clause 6 Article 3 of this Circular shall:

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c.2) Cooperate with supervisory tax authorities in offsetting overpaid amounts against the debts and new amounts under their management according to Point a.4 Clause 1 of this Article.

Article 26. Cancellation of refund of overpaid tax, late payment interest and fines

In case the taxpayer has an overpaid amount which is not eligible for refund and the tax authority finalizes the overpaid amount on the accounting books or tax administration system according to Clause 3 Article 60 of the Law on Tax Administration:

1. In the case specified in Point a Clause 3 Article 60 of the Law on Tax Administration:

a) The taxpayer shall send a document rejecting the refund according to Form No. 01/DNKHT in Appendix I hereof.

b) The tax authority specified in Clause 4 of this Article shall receive and process the taxpayer's document within 05 working days from its receipt as follows:

b.1) If information matches, the tax authority shall issue the decision on refund cancellation according to Form No. 01/QD-KHTNT in Appendix I hereof and send it to the taxpayer.

b.2) If information does not match, the tax authority shall send the taxpayer a request for explanation and supplementary documents according to Form No. 01/TB-BSTT-NNT enclosed with Decree No. 126/2020/ND-CP.

The explanation and supplementation time shall be excluded from the processing time. If the taxpayer's explanation and supplementary documents match the information on the tax administration system, the tax authority shall issue the decision on refund cancellation. If the taxpayer fails to provide explanation and supplementary information by the deadline imposed by the tax authority, the tax authority shall send the taxpayer a notification that the taxpayer's overpaid amount cannot be finalized according to Form No. 02/TB-KHTNT and provide explanation.

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a) After 180 days from the day on which the tax authority issues the notification that the taxpayer no longer operates at the registered address, the supervisory tax authority shall publish the notification of the taxpayer's overpaid amount (Form No. 01/DSKNT) on its website and mass media after the tax authority offsets the overpaid amount and debts of the taxpayer nationwide.

b) Before issuing the notification of the taxpayer's overpaid amount mentioned in Point a of this Clause, the supervisory tax authority shall cooperate with the state budget revenue-managing tax authority or the tax authority of the receiving province in determining the taxpayer's overpaid amounts and debts nationwide after offsetting is carried out by the tax administration system according to Point a.1 Clause 1 Article 25 of this Circular; issue a decision on refund cum state budget offsetting according to Form No. 02/QDHT in Appendix I hereof (the refunded amount is equal to the offset debt, no amount is refunded after offsetting). The tax authority shall send an order for return and offsetting of state budget revenues to State Treasury in accordance with Article 47 of this Circular.

c) After 01 year from the issuance date of the notification mentioned in Point a of this Clause, if the tax authority does not receive any written request for refund of the overpaid amount form the taxpayer, the supervisory tax authority shall issue the decision on refund cancellation according to Form No. 01/QD-KHTNT in Appendix I hereof and finalized the taxpayer's overpaid amount which is not refunded on the accounting book.

d) Within 03 working days from the day on which the taxpayer's overpaid amount is finalized on the accounting books, the supervisory tax authority shall publish the decision on refund cancellation on its website.

3. In case the taxpayer fails to offset the overpaid amount against tax obligations and does not claim tax refund according to Point c Clause 3 Article 60 of the Law on Tax Administration:

a) After March 31 every year, pursuant to Clause 4 of this Article, the tax authority shall compile a list of overpaid amounts that have been overdue for 10 years according to Form No. 01/DSKNT in Appendix I hereof.

b) The tax authority shall send the taxpayer the notification of the overpaid amount that has been overdue for 10 years according to Form No. 02/TB-KHTNT in Appendix I hereof. The tax authority shall publish overpaid amounts of taxpayers that no longer operate at their registered addresses or whose TINs have been invalidated.

c) If the tax authority does not receive the taxpayer's response within 15 working days from the day on which the notification is sent to the taxpayer or published on the tax authority's website, the tax authority shall issue the decision on refund cancellation according to Form No. 01/QD-KHTNT in Appendix I hereof and finalized the taxpayer's overpaid amount on the accounting book.

d) Within 03 working days from the day on which the taxpayer's overpaid amount is finalized on the accounting books, the supervisory tax authority shall publish the decision on refund cancellation on its website.

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a) Supervisory tax authorities shall:

a.1) Receive, process applications for refund cancellation of taxpayers and issue decisions on refund cancellation regarding the overpaid amounts under their management or under management of the tax authority of the receiving province according to Point b Clause 6 Article 3 of this Circular.

a.2) Issue decisions on refund cancellation in cases where taxpayers under their management no longer operate at their registered addresses.

a.3) Issue decisions on refund cancellation in cases where overpaid amounts have been overdue for 10 years under their management or under management of the tax authority of the receiving province according to Point b Clause 6 Article 3 of this Circular.

b) State budget revenue-managing tax authorities shall:

b.1) Receive, process applications for refund cancellation of taxpayers and issue decisions on refund cancellation regarding the overpaid amounts under their management.

b.2) Cooperate in reviewing overpaid amounts and debts before the supervisory tax authorities issue decisions on refund cancellation in cases where taxpayers no longer operate at their registered addresses; finalize overpaid amounts under their management according to issued decisions.

b.3) Issue decisions on refund cancellation in cases where overpaid amounts have been overdue for 10 years under their management.

c) The tax authority of the receiving province prescribed in Point b Clause 6 Article 3 of this Circular shall:

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Chapter V

TAX REFUND PROCEDURES

Section 1. TAX REFUND ACCORDING TO TAX LAWS

Article 27. Responsibilities of tax authorities for processing tax refund applications

1. Cases of tax refund according to tax laws:

a) VAT refund according to VAT laws.

b) Refund of excise tax according to excise tax laws on biological gasoline.

c) Tax refund according to Double Taxation Agreements and other International Agreements to which the Socialist Republic of Vietnam is a signatory.

2. Responsibility for receiving and processing applications for tax refund according to tax laws

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Heads of Departments of Taxation of Hanoi, Ho Chi Minh City, Binh Duong province, Dong Nai province may assign sub-department of taxation to receive and process VAT refund applications from taxpayers under direct management of sub-departments of taxation, including the following tasks: classify tax refund applications eligible for tax refund before inspection or subject to inspection before refund; determine refundable tax; determine tax debt, fine, late payment interest to be offset against refundable tax; draft tax refund decisions or decisions on tax refund and state budget revenue offsetting (hereinafter referred to as "tax refund decision") or notification of rejected applications (if any); then transfer all documents to the Department of Taxation for completion according to this Circular.

b) The Department of Taxation where the taxpayer declares VAT on the investment project according to Point a Clause 1 Article 11 of Decree No. 126/2020/ND-CP shall receive and process applications for refund of tax on the investment project of the taxpayer.

c) Supervisory tax authorities shall receive and process applications for refund of input VAT that remains after deduction upon transfer of ownership, conversion of enterprises, consolidation, merger, full division, partial division, bankruptcy and shutdown of enterprises.

Article 28. Application for VAT refund

An application for VAT refund according to VAT laws (except refund of VAT under international treaties; refund of input VAT that remains after deduction upon transfer of ownership, conversion of enterprises, consolidation, merger, full division, partial division, bankruptcy and shutdown of enterprises specified in Article 30 and Article 31 of this Circular) shall contain:

1. The application form No. 01/HT in Appendix I hereof.

2. Documents that are relevant to the case. To be specific:

a) Refund of VAT on an investment project:

a.1) Copy of the Certificate of Investment Registration or Investment Certificate or Investment License in case the Certificate of Investment Registration is mandatory;

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a.3) Copy of the charter capital contribution certificate;

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