Decree No. 41/2020/ND-CP extension of time limits for tax and land rental payment

DECREE

On extension of time limits for tax and land rental payment^[1]

Pursuant to the June 19, 2015 Law on Organization of the Government;

Pursuant to the November 29, 2006 Law on Tax Administration;

Pursuant to the November 20, 2012 Law Amending and Supplementing a Number of Articles of the Law on Tax Administration;

Pursuant to the November 26, 2014 Law Amending and Supplementing a Number of Articles of the Laws on Taxes;

Pursuant to the April 6, 2016 Law Amending and Supplementing a Number of Articles of the Law on Value-Added Tax, the Law on Excise Tax and the Law on Tax Administration;

At the proposal of the Minister of Finance;

The Government promulgates the Decree on extension of time limits for tax and land rental payment.

Article 1.Scope of regulation

This Decree provides for the extension of time limits for payment of value-added tax (VAT), enterprise income tax (EIT), personal income tax (PIT) and land rental.

Article 2.Subjects of application

This Decree applies to:

1. Enterprises, organizations, households and individuals conducting production activities in the following economic sectors:

a/ Agriculture, forestry and fisheries;

b/ Foodstuff production or processing; textiles; production of wearing apparel; production of leather and related products; wood processing and production of wood products, bamboo or neohouzeaua (except beds, wardrobes, tables and chairs); production of products from straw, thatch and plaiting materials; production of paper and paper products; production of products from rubber and plastics; production of products from other nonmetallic minerals; metal production; mechanical processing; metal treatment and coating; manufacture of electronic products, computers and optical products; manufacture of automobiles and other motorized vehicles; production of beds, wardrobes, tables and chairs;

c/ Construction.

2. Enterprises, organizations, households and individuals conducting business activities in the following economic sectors:

a/ Transportation and warehousing; accommodation and catering services; education and training; medical and social assistance activities; real estate business;

b/ Labor and employment services; travel agency and tour operation and auxiliary services related to tour promotion and organization;

c/ Creation, art and recreation; library operations, archives, museums and other cultural activities; sports, entertainment and recreation; cinema.

The lists of economic sectors stated in Clauses 1 and 2 of this Article shall be determined according to the Prime Minister’s Decision No. 27/2018/QD-TTg of July 6, 2018, promulgating the system of Vietnam’s economic sectors.

The system of economic sectors prescribed in Appendix I to Decision No. 27/2018/QD-TTg includes 5 grades and economic sectors shall be determined according to the following principles: In case an economic sector prescribed in Clause 1 or 2 of this Article is a grade-1 sector, the provision on extension of payment time limits shall apply to all grade-2, -3, -4 and -5 economic sectors of such grade-1 sector; in case the economic sector is a grade-2 sector, the provision on extension of payment time limits shall apply to all grade-3, -4 and -5 economic sectors of such grade-3 sector; in case the economic sector is a grade-3 sector, the provision on extension of payment time limits shall apply to all grade-4 and -5 economic sectors of such grade-2 sector; in case the economic sector is a grade-4  sector, the provision on extension of payment time limits shall apply to all grade-5 economic sectors of such grade-4 sector.

3. Enterprises, organizations, households and individuals engaged in production of supporting industry products prioritized for development; key mechanical products.

Supporting industry products prioritized for development shall be determined under the Government’s Decree No. 111/2015/ND-CP of November 3, 2015, on development of supporting industries; key mechanical engineering products shall be determined under the Prime Minister’s Decision No. 319/QD-TTg of March 15, 2018, approving the Strategy for development of Vietnam’s mechanical engineering sector through 2025, with a vision toward 2035.

4. Small- and micro-sized enterprises shall be determined under Law No. 04/2017/QH14 on Support for Small- and Medium-Sized Enterprises and the Government’s Decree No. 39/2018/ND-CP of March 11, 2018, detailing a number of articles of the Law on Support for Small- and Medium-Sized Enterprises.

5. Credit institutions and foreign bank branches shall take solutions to support clients being enterprises, organizations and individuals affected by Covid-19 pandemic according regulations of the State Bank of Vietnam. The State Bank of Vietnam shall publicize a list of credit institutions and foreign bank branches providing support to clients so that tax administration offices shall extend time limits for tax and land rental payment according to this Decree.

The economic sector or field of an enterprise, organization, or a business household or individual prescribed in Clause 1, 2 or 3 of this Article is the sector or field in which such enterprise, organization or business household or individual conducts production or business activities and generates revenue in 2019 or 2020.

Article 3.Extension of time limits for tax and land rental payment

1. For VAT (except VAT at the import stage)

a/ To extend the time limits for payment of the payable VAT amount of the tax periods of March, April, May and June 2020 (in case of making monthly tax declaration) and the tax periods of first and second quarters of 2020 (in case of making quarterly tax declaration) of the enterprises and organizations prescribed in Article 2 of this Decree. The extension duration is 5 months from the deadline for VAT payment prescribed by the law on tax administration.

In case a taxpayer makes additional declaration to its tax declaration dossier of a tax period which is entitled to extension of tax payment time limit, resulting in an increase in the payable VAT amount, and sends the additional declaration to the concerned tax office before the extended tax payment time limit expires, the tax amount entitled to extension of the payment time limit is also inclusive of the payable tax amount increased due to additional declaration.

Enterprises and organizations eligible for extension of tax payment time limits shall make and submit monthly or quarterly VAT declarations in accordance with the current law but are not required to pay the payable VAT amounts stated in the VAT declarations already filled in. The deadlines for payment of VAT amounts of the months and quarters eligible for extension of tax payment time limits are as follows:

The deadline for payment of VAT for the tax period of March 2020 is September 20, 2020.

The deadline for payment of VAT for the tax period of April 2020 is October 20, 2020.

The deadline for payment of VAT for the tax period of May 2020 is November 20, 2020.

The deadline for payment of VAT for the tax period of June 2020 is December 20, 2020.

The deadline for payment of VAT for the tax period of the first quarter of 2020 is September 30, 2020.

The deadline for payment of VAT for the tax period of the second quarter of 2020 is December 30, 2020.

b/ In case an enterprise or organization stated in Article 2 of this Decree has branches or affiliated units that make separate VAT declarations with their managing tax offices, such branches or affiliated units will also be eligible for extension of VAT payment time limits. In case braches or affiliated units of an enterprise or organization stated in Clause 1, 2 or 3, Article 2 of this Decree do not conduct production or business activities in the economic sectors and fields eligible for extension of tax payment time limit, such branches or affiliated units will not be eligible for extension of VAT payment time limits.

2. For EIT

a/ To extend the time limit for payment of the remaining EIT amounts according to tax finalization statements of the 2019 tax period and the temporarily paid EIT amounts of the tax periods of the first and second quarters of 2020 of enterprises and organizations being EIT payers and falling into the cases specified in Article 2 of this Decree. The extended duration is 5 months from the deadline for EIT payment prescribed by the law on tax administration.

In case an enterprise or organization has remitted to the state budget the remaining payable EIT amount according to the tax finalization statement of the 2019 tax period, it may make adjustments for the paid EIT amount to pay other payable tax amounts. In order to have the EIT amount adjusted, the taxpayer shall submit to a tax office a letter of amendment (made according to Form No. C1-11/NS issued together with the Ministry of Finance’s Circular No. 84/2016/TT-BTC of June 17, 2016) accompanied by tax payment documents or information relating to contents requested for adjustment.

b/ In case an enterprise or organization stated in Article 2 of this Decree has branches or affiliated units that make separate EIT declarations with their managing tax offices, such branches or affiliated units will also be eligible for extension of the EIT payment time limit. In case braches or affiliated units of an enterprise or organization stated in Clause 1, 2 or 3, Article 2 of this Decree do not conduct production or business activities in the economic sectors and fields eligible for extension of tax payment time limit, such branches or affiliated units will not be eligible for extension of the EIT payment time limit.

3. For VAT and PIT of business households and individuals

To extend the time limits for payment of payable VAT and PIT amounts of 2020 of business households and individuals operating in the economic sectors and fields prescribed in Clauses 1, 2 and 3, Article 2 of this Decree. Business households and individuals shall pay the tax amounts eligible for extension of the payment time limit under this Clause on December 31, 2020, at the latest.

4. For land rental

To extend the time limits for payment of the payable land rental amounts of the first period of 2020 of enterprises, organizations, households and individuals that fall into the cases prescribed in Article 2 of this Decree and are leased land directly by the State under decisions of and contracts signed with competent state agencies in the form of annual payment of land rental. The extension duration is 5 months from May 31, 2010.

This provision applies also to enterprises, organizations, and business households and individuals that are leased land directly by the State under more than one decision or contract and conduct production and business activities in different sectors and fields including those prescribed in Clauses 1, 2, 3 and 5, Article 2 of this Decree.

5. For enterprises, organizations, and business households and individuals conducting  production and business activities in different economic sectors, including those prescribed in Clauses 1, 2, 3 and 5, Article 2 of this Decree: Enterprises and organizations will be eligible for extension of time limits for payment of the whole payable VAT and EIT amounts; business households and individuals will be eligible for extension of time limits for payment of the whole payable VAT and PIT amounts under the guidance of this Decree.

Article 4.Order and procedures for extension

1. A taxpayer eligible for extension shall submit a request for extension of time limits for tax and land rental payment (electronically or by other means), made according to the form provided in the Appendix to this Decree, to its/his/her managing tax office once for all tax periods and for taxes of all types and land rental eligible for extension of payment time limits when submitting monthly (or quarterly) tax declaration dossiers in accordance with the law on tax administration. In case a taxpayer does not submit a request for extension of time limits for tax and land rental payment and the monthly (or quarterly) tax declaration dossier at the same time, it/he/she shall submit the request no later than July 30, 2020, and the tax administration office shall still extend the time limits for payment of tax and land rental of the periods preceding the time of submission of the request for extension, which are eligible for extension of payment time limit.

For a taxpayer that is leased land by the State in different localities, its/his/her managing tax office shall make and send a copy of the request for extension of time limits for tax and land rental payment to the tax office of each locality where exists the land leased.

2. Taxpayers shall determine by themselves and take responsibility for their request for extension of the time limits for tax and land rental payment, ensuring that they are eligible subjects as prescribed in this Decree. If a taxpayer submits a request for extension of time limits for tax and land rental payment to a tax office after July 30, 2020, it/he/she will not entitled to extension of time limits for tax and land rental payment in accordance with this Decree.

3. Tax offices are not required to notify taxpayers of the acceptance of the requests for extension of time limits for tax and land rental payment. During the extension period, if a tax office has grounds to believe that a taxpayer is ineligible for extension, the tax office shall notify in writing the taxpayer of the suspension of extension and the taxpayer shall fully remit to the state budget tax and land rental amounts and late-payment interests for the actual extension period. In case the extension period has expired and a tax office, through inspection and examination, detects that a taxpayer is ineligible for extension of time limits for tax and land rental payment under this Decree, the taxpayer shall fully remit to the state budget the deficit tax amount, fines and late-payment interests re-determined by the tax office.

4. During the extension period, based on the requests for extension of time limits for tax and land rental payment, tax offices shall not calculate late-payment interests on tax and land rental amounts eligible for extension of payment time limits (including also cases in which such requests are sent to tax offices after submission of monthly (or quarterly) tax declaration dossiers on July 30, 2020, at the latest).

Article 5.Organization of implementation and effect

1. This Decree takes effect on the date of its signing.

2. The Ministry of Finance shall take responsibility for directing, organizing the implementation and settling problems arising in the course of implementation of this Decree.

3. Ministers, heads of ministerial-level agencies, heads of government-attached agencies, chairpersons of provincial-level People’s Committees, and related enterprises, organizations, households and individuals shall implement this Decree.-

On behalf of the Government
Prime Minister
NGUYEN XUAN PHUC

* The appendices to this Decree are not translated.