Circular No. 27/2009/TT-BTC dated February 06, 2009 of the Ministry of Finance on deferment of time for payment of personal income tax

THE MINISTRY OF FINANCE

Circular No. 27/2009/TT-BTC of February 6, 2009, guiding the delay of personal income tax payment

Pursuant to the Law on Personal Income Tax and guiding documents;

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;

The Ministry of Finance temporarily guides the delay of personal income tax payment as follows:

Article 1. Subjects eligible for personal income tax payment delay

1. Subjects eligible for personal income tax payment delay prescribed in this Circular include:

- Resident individuals earning taxable incomes from business activities; incomes from salaries or wages; incomes from capital investment; incomes from capital transfer (including securities transfer); incomes from copyright royalties; incomes from commercial franchising; incomes from inheritance; and incomes from gifts;

- Non-resident individuals earning taxable incomes from capital investment or capital transfer (including securities transfer); incomes from copyright royalties; and incomes from commercial franchising.

2. Subjects ineligible for tax payment delay:

- Resident individuals earning incomes from real estate transfer; incomes from won prizes;

- Non-resident individuals (including those who are not present in Vietnam or leave Vietnam before June 30, 2009) earning incomes from business activities; incomes from salaries or wages; incomes from real estate transfer; incomes from won prizes; incomes from inheritance; and income from gifts.

Article 2. Tax payment delay duration

1. Tax payment delay duration: From January 1, 2009, to the end of May 31, 2009.

2. Determination of the tax amount eligible for payment delay:

2.1. For incomes from salaries or wages of resident individuals: It is the personal income tax amount to be withheld by income payers or the personal income tax amount to be declared by individuals (for individuals making direct tax declarations) on a monthly basis.

2.2. For incomes from capital investment or capital transfer (including securities transfer), copyright royalties or commercial franchising: It is the personal income tax amount to be declared by individuals or to be withheld by the income payers at each time of income generation.

2.3. For incomes from inheritance or gifts of resident individuals: It is the personal income tax amount to be declared by individuals at each time of income generation.

2.4. For incomes from business activities of resident individuals:

a/ For those who temporarily pay personal income tax on a quarterly basis:

- For business individuals who fully observe the invoice- and document-based accounting regulations, can account turnovers and expenses and pay tax according to declaration, the personal income tax amount eligible for payment delay is the quarterly tax amount temporarily calculated according to declaration.

- For business individuals who can account only turnovers from but not expenses for business activities, the personal income tax amount eligible for payment delay is the quarterly tax amount temporarily calculated according to declared turnovers and the proportion of taxable incomes.

- For business individuals who pay tax by the presumptive method, the tax amount eligible for payment delay is the amount calculated by the presumptive method and due in the quarter according to notices of tax offices.

b/ For individuals who lease houses or assets and collect lump-sum rents for several months, the tax amount eligible for payment delay is the tax amount corresponding to the months in the delay duration.

c/ For individuals doing mobile business and business individuals paying tax by the presumptive method who need to issue retail invoices, the personal income tax amount eligible for payment delay is determined as equal to the to-be-temporarily paid tax amount calculated on the turnover from each shipment or turnovers indicated on retail invoices.

d/ For individuals who act as sale agents on commission (insurance or lottery agents): The personal income tax amount eligible for payment delay is the tax amount to be temporarily withheld by commission payers on a monthly basis.

For cases ineligible for tax payment delay, income payers and income earners shall declare and pay tax under the Finance Ministry’s Circular No. 84/2008/TT-BTC of September 30, 2008, guiding the implementation of a number of articles of the Law on Personal Income Tax and the Government’s Decree No. 100/2008/ND-CP of September 8, 2008, detailing the implementation of a number of articles of the Law on Personal Income Tax.

3. Order of and procedures for tax payment delay:

3.1. For incomes subject to tax withholding: Income payers shall withhold personal income tax for subjects eligible for tax payment delay and, when paying incomes, still calculate to-be-withheld tax amounts and notify income earners of these amounts which are eligible for payment delay. Every month, they shall make declarations of withheld tax amounts according to current regulations and submit these declarations to tax offices for the latter to know about the arisen tax amounts which are eligible for payment delay.

3.2. For incomes directly declared by taxpayers to tax offices:

Individuals eligible for tax payment delay who earn incomes to be directly declared to tax offices according to regulations shall still make and submit tax declarations in accordance with current regulations.

3.3. Income earners may retain tax amounts eligible for tax payment delay during the tax payment delay duration.

In May 2009, the Government shall propose the National Assembly to decide on the disposal of tax amounts eligible for payment delay and then implement the National Assembly’s decision.

4. Handling of violations:

In the tax payment delay duration, tax-withholding organizations and individuals and individuals earning incomes eligible for tax payment delay will not be considered having committed the violation of delayed tax payment and administratively sanctioned for delayed tax payment with regard to tax amounts eligible for payment delay.

Other violations related to tax withholding and declaration shall be administratively sanctioned under the Law on Tax Administration.

Upon the expiration of the delay duration, organizations and individuals eligible for tax payment delay shall comply with the guidance of the Finance Ministry.

Article 3. Organization of implementation

This Circular takes effect 45 days from the date of its signing and applies to incomes earned from January 1, 2009. Any problems arising in the course of implementation should be reported to the Ministry of Finance for timely settlement.-

For the Minister of Finance
Vice Minister
DO HOANG ANH TUAN