Circular No. 40/2021/TT-BTC guidelines on VAT, PIT and tax administration for business households
From August 01, 2021, apply tax rates of 7% to karaoke, massage, billiards, shampoo and laundry services
The Ministry of Finance issues the Circular No. 40/2021/TT-BTC providing guidelines on value added tax, personal income tax and tax administration for business households and individuals on June 01, 2021.
Specifically, value added tax (VAT) rate of 5% and personal income tax (PIT) rate of 2% shall be applied to: services of sauna, massage, karaoke, discos, billiards, internet, games; tailoring and laundry services, services of hair cutting, styling and shampoo; other repair services: repair of computers and household appliances; services of legal consulting, financial consulting, accounting, audit; services of implementation of administrative procedures related to tax and customs, etc.
Besides, leasing properties (including leasing houses, land, stores, factories, warehouses except for accommodation service; leasing means of transport, machines and equipment without drivers; leasing other properties without service) shall be applied tax rate of 10% at most (including VAT rate of 5% and PIT rate of 5%)
In addition, business households and individuals with revenues from production and business activities in a calendar year of VND 100 million or less shall be exempted from paying VAT and not be required to pay PIT as prescribed by law provisions on VAT and PIT. Business households and individuals shall make accurate, truthful, and complete tax declarations and submitting tax dossiers on time.
The Circular takes effect from August 01, 2021.
For further details of the Circular 40/2021/TT-BTC, Click here
translation of the Official Gazette of the Vietnam News Agency
THE MINISTRY OF FINANCE
THE SOCIALIST REPUBLIC OF VIETNAM
Independence - Freedom - Happiness
Hanoi, June 01, 2021
Providing guidelines on value added tax, personal income tax and tax administration for business households and individuals
Pursuant to the Personal Income Tax Law dated November 21, 2007; and the Law dated November 22, 2012 Amending and Supplementing a Number of Articles of the Law on Personal Income Tax;
Pursuant to the Law on Value Added Tax dated June 3, 2008; and the Law dated June 19, 2013 Amending and Supplementing a Number of Articles of the Law on Value Added Tax;
Pursuant to the November 26, 2014 Law Amending and Supplementing a Number of Articles of the Tax Laws;
Pursuant to the Law on Tax Administration dated June 13, 2019;
Pursuant to the Government's Decree No. 209/2013/ND-CP dated December 18, 2013 detailing and guiding the implementation of a number of articles of the Law on Value Added Tax;
Pursuant to the Government's Decree No. 12/2015/ND-CP dated February 12, 2015 detailing the implementation of the Law Amending and Supplementing a Number of Articles of the Tax Laws, and amending and supplementing a number of articles of the decrees on taxes;
Pursuant to the Government's Decree No. 126/2020/ND-CP dated October 19, 2020 detailing a number of articles of the Law on Tax Administration;
Pursuant to the Government's Decree No. 87/2017/ND-CP dated July 26, 2017 defining the functions, tasks, powers, and organizational structure of the Ministry of Finance;
At the proposal of the Director General of Taxation;
The Minister of Finance promulgates the Circular providing guidelines on value added tax, personal income tax and tax administration for business households and individuals as follows:
Article 1. Scope of regulation
This Circular provides guidelines on value-added tax (VAT), personal income tax (PIT) and tax administration for business households and individuals.
Article 2. Subjects of application
1. Business households and individuals who are resident individuals engaged in the production and trading of goods and services in all production sectors and business lines as prescribed by law provisions, including also the follows:
a) Independent professional activities in sectors and business lines for which practice licenses or certificates are granted in accordance with law provisions;
b) Agents selling goods at fixed prices, including lottery agents, insurance agents and multi-level marketing agents of individuals directly signing contracts with lottery enterprises, insurance enterprises, and multi-level marketing enterprises;