Circular No. 20/2010/TT-BTC dated February 5, 2010 of the Ministry of Finance revising a number of administrative procedures related to personal income tax

THE MINISTRY OF FINANCE

Circular No. 20/2010/TT-BTC of February 5, 2010, revising a number of administrative procedures related to personal income tax

Pursuant to the Law on Personal Income Tax (PIT) and the Government’s Decree No. 100/2008/ND-CP of September 8, 2008, detailing a number of articles of the PIT Law;

Pursuant to the Government’s Decree No. 118/2008/ND-CP of November 27, 2008, defining the functions, tasks, powers and organizational structure of the Ministry of Finance;

In order to reform and simplify PIT-related administrative procedures, the Ministry of Finance guides the revision of a number of PIT-related administrative procedures as follows:

Article 1. To revise a number of forms of returns, lists and written PIT declarations as follows (see the list attached to this Circular):

1. The PIT withholding return for organizations and individuals paying incomes from salaries and wages shall be made according to form No. 02/KK-TNCN attached to this Circular (not printed herein) and the PIT withholding return for organizations and individuals paying incomes from capital investment, securities transfer, copyright royalties, commercial franchise and prize winning to individuals and paying incomes from business activities to non-resident individuals shall be made according to form No. 03/KK-TNCN attached to this Circular (not printed herein), in replacement of forms No. 02/KK-TNCN, No. 03/KK-TNCN and No. 04/KK-TNCN attached to the Finance Ministry’s Circular No. 84/2008/TT-BTC of September 30, 2008, guiding a number of articles of the PIT Law, and the Government’s Decree No. 100/2008/ND-CP of September 8, 2008, detailing a number of articles of the PIT Law (below referred to as Circular No. 84/2008/TT-BTC).

2. The PIT finalization return for organizations and individuals paying incomes from salaries and wages to individuals shall be made according to form No. 05/KK-TNCN (not printed herein) while detailed lists shall be made according to forms No. 05A/BK-TNCN and No. 05B/BK-TNCN attached to this Circular (not printed herein), in replacement of forms No. 05/KK-TNCN, No. 05A/BK-TNCN and No. 05B-TNCN attached to Circular No. 84/2008/TT-BTC.

3. The PIT finalization return for organizations and individuals paying incomes from capital investment, securities transfer, copyright royalties, commercial franchise and prize winning to individuals and paying incomes from business activities to non-resident individuals shall be made according to form No. 06/KK-TNCN (not printed herein) while detailed lists shall be made according to form No. 06B/BK-TNCN attached to this Circular (not printed herein), in replacement of forms No. 06/KK-TNCN and No. 06B/BK-TNCN attached to Circular No. 84/2008/TT-BTC. Forms No. 06A/BK-TNCN, 06C/BK-TNCN and 06D/BK-TNCN attached to Circular No. 84/2008/TT-BTC are annulled.

4. The PIT return for both resident and non-resident individuals who earn incomes from salaries and wages and make direct declaration with tax offices shall be made according to form No. 07/KK-TNCN attached to this Circular (not printed herein), in replacement of form No. 07/KK-TNCN attached to Circular No. 84/2008/TT-BTC.

5. The return on temporary payment of PIT (for business individuals paying tax according to declaration) shall be made according to form No. 08/KK-TNCN attached to this Circular (not printed herein), in replacement of form No. 08/KK-TNCN attached to Circular No. 84/2008/TT-BTC.

6. The return on temporary payment of PIT (for groups of business individuals paying tax according to declaration) shall be made according to form No. 08A/KK-TNCN attached to this Circular (not printed herein), in replacement of form No. 08A/KK-TNCN attached to Circular No. 84/2008/TT-TNCN.

7. The PIT finalization return (for groups of business individuals) shall be made according to form No. 08B/KK-TNCN attached to this Circular (not printed herein), in replacement of form No. 08B/KK-TNCN attached to Circular No. 84/2008/TT-BTC.

8. The PIT finalization return for individuals earning incomes from salaries and wages and individuals earning incomes from business activities shall be made according to form No. 09/KK-TNCN while appendices shall be made according to form No. 09A/PL-TNCN and 09B/PL-TNCN attached to this Circular (not printed herein), in replacement of forms No. 09/KK-TNCN,. 09A/PL-TNCN and 09B/PL-TNCN attached to Circular No. 84/2008/TT-BTC.

9. The PIT finalization return for individuals earning incomes from securities transfer shall be made according to form No. 13/KK-TNCN attached to this Circular, in replacement of form No. 13/KK-TNCN attached to Circular No. 84/2008/TT-BTC.

10. The application for PIT reduction shall be made according to form No. 18/MGT-TNCN attached to this Circular (not printed herein), in replacement of form No. 18/MGT-TNCN attached to Circular No. 84/2008/TT-BTC.

11. The PIT withholding return for principal establishments paying incomes to insurance agents shall be made according to form No. 01/KK-BH attached to this Circular (not printed herein), in replacement of form No. 01/KK-BH attached to the Finance Ministry’s Circular No. 10/2009/TT-BTC of January 21, 2009, guiding the PIT registration, withholding, declaration and finalization for individuals acting as insurance agents (below referred to as Circular No. 10/2009/TT-BTC).

12. The PIT return for principal establishments paying incomes to insurance agents shall be made according to form No. 02/KK-BH while lists of taxable incomes and withheld PIT amounts of insurance agents shall be made according to form No. 02A/BK-BH attached to this Circular (not printed herein), in replacement of forms No. 02/KK-BH and No. 02A/BK-BH attached to Circular No. 10/2009/TT-BTC.

13. The PIT withholding return for principal establishments paying incomes to lottery agents shall be made according to form No. 01/KK-XS attached to this Circular (not printed herein), in replacement of form No. 01/KK-XS attached to the Finance Ministry’s Circular No. 42/2009/TT-BTC of March 9, 2009, guiding PIT withholding for individuals acting as lottery agents and individuals earning incomes from lottery prizes (below referred to as Circular No. 42/2009/TT-BTC).

14. The PIT finalization return for principal establishments paying incomes to lottery agents shall be made according to form No. 02/KK-XS while lists of taxable incomes and withheld PIT amounts of lottery agents shall be made according to form No. 02A/BK-XS attached to this Circular (not printed herein), in replacement of forms No. 02/KK-XS and No. 02A/BK-XS attached to Circular No. 42/2009/TT-BTC.

15. PIT return for individuals receiving dividends in shares, bonus shares or an increase in contributed capital shall be made according to form No. 24/KK-TNCN attached to this Circular, in replacement of form No. 24/KK-TNCN issued together with the Finance Ministry’s Circular No. 62/2009/TT-BTC of March 27, 2009, amending and supplementing a number of provisions of Circular No. 84/2008/TT-BTC.

16. To annul appendices on PIT reduction (forms No. 01/KKQT-TNCN, No. 02/KKQT-TNCN and No. 03/KKQT-TNCN) to the Finance Ministry’s Circular No. 176/2009/TT-BTC of September 9, 2009, guiding the reduction of PIT for individuals working in economic zones for compliance with forms of declarations and lists provided in Article 1 of this Circular.

Organizations and individuals paying salaries and wages to individuals working in economic zones shall declare and finalize the withheld PIT amounts, after being reduced, according to form No. 05/KK-TNCN and compile lists according to forms No. 05A/KK-TNCN and No. 05B/KK-TNCN attached to this Circular (not printed herein).

Individuals earning incomes in economic zones who are eligible for PIT reduction shall declare the reducible PIT amount in a PIT finalization declaration made according to form No. 09/KK-TNCN and compile appendices according to forms No. 09A/PL-TNCN, 09B/PL-TNCN attached to this Circular (not printed herein).

Article 2. To replace the guidance on dossiers of request for PIT refund prescribed at Point 3.2, Section II, Part D of Circular No. 84/2008/TT-BTC with the following guidance:

3.2. A tax refund dossier comprises:

- A PIT finalization return (for entities subject to PIT finalization);

- An application for tax reduction, made according to form No. 18/MGT-TNCN (for individuals who are eligible for PIT reduction due to natural disasters, fires, accidents or fatal diseases and request for tax refund);

- PIT withholding documents and PIT receipts (originals).

In case the paid tax amount of resident individuals earning incomes from salaries and wages or business activities and securities transferors registering for tax payment at the tax rate of 20% who are subject to tax finalization declaration or the paid tax amount, after being reduced, of individuals eligible for tax reduction due to natural disasters, fires, accidents or fatal diseases is larger than the payable tax amount, if wishing to enjoy tax refund, they shall make declarations in the “total tax amount to be refunded” item in declarations, enclosed with tax documents and receipts.

Based on the tax refund request in the finalization returns and the application for tax reduction; tax agencies shall inspect and effect tax refund, individuals requesting for tax refund are not required to carry out tax refund procedures prescribed at Point 6, Section I, Part G of the Finance Ministry’s Circular No. 60/2007/TT-BTC of June 14, 2007, guiding a number of articles of the Law on Tax Administration, and the Government’s Decree No. 85/2007/ND-CP of May 25, 2007, detailing a number of articles of the Law on Tax Administration, and Point 6, Section I, Part B of the Finance Ministry’s Circular No. 128/2008/TT-BTC of December 24, 2008, guiding the collection and management of state budget revenues via state treasuries.

Article 3. Organization of implementation

1. This Circular takes effect 45 days from the date of its signing. Tax refund procedures for PIT finalization declarations apply from the 2009 tax finalization period while other contents apply from the 2010 tax declaration period. PIT-related administrative procedures not yet guided in this Circular still comply with current legal documents.

2. Any problems arising in the process of implementation should be promptly reported to the Ministry of Finance (the General Department of Taxation) for study and settlement.-

For the Minister of Finance
Deputy Minister
DO HOANG ANH TUAN