Vietnamese
Monthly or quarterly personal income tax declaration is very important because it decides the responsibility for submitting the taxpayer’s declaration and payment and the periodical jobs that every accountant must do.
1. Does the personal income tax collection subject to monthly or quarterly declaration?
Clause 1 and Clause 2, Article 8, Decree No. 126/2020/ND-CP which prescribes the taxes subject to monthly, the quarterly or annual declaration make this problem clear as follows:
“1. Taxes and other state budget revenues the collection of which is managed by tax administration offices and which are subject to the monthly declaration include:
a/ Value-added tax and personal income tax. Taxpayers that satisfy the criteria specified in Article 9 of this Decree may make quarterly declarations.
...
2. Taxes and other state budget revenues subject to quarterly declaration include:
...
c/ Personal income tax, for income payers subject to tax withholding under the law on personal income tax that are subject to quarterly value-added tax declaration and choose to make quarterly personal income tax declaration; and individuals earning incomes from salaries or wages who directly make tax declaration with tax offices and choose to make quarterly personal income tax declaration.
...”
Therefore, taxpayers can make monthly personal income tax declarations and payments, in the cases that they can satisfy all the quarterly criteria, they can make quarterly personal income tax declarations and payments.
The quarterly declaration criteria is prescribed in Clause 1, Article 9, Decree No. 126/2020/ND-CP as follows:
“1. Criteria for quarterly tax declaration
a/ Quarterly declaration of value-added tax shall apply to:
a.1/ Taxpayers subject to monthly declaration of value-added tax specified at Point a, Clause 1, Article 8 of this Decree that have a total turnover of up to VND 50 billion from the sale of goods and provision of services in the preceding year. Turnover from the sale of goods and provision of services is the total turnover recorded in the value-added tax declarations of the tax periods in a calendar year.
...
a.2/ Taxpayers having just commenced operation or business activities; they may make monthly or quarterly value-added tax declaration...
b/ Quarterly declaration of personal income tax is specified as follows:
b.1/ Taxpayers subject to monthly declaration of personal income tax specified at Point a, Clause 1, Article 8 of this Decree that fully satisfy the conditions for quarterly declaration of value-added tax may make quarterly declaration of personal income tax.”.
In conclusion, taxpayers must be subject to the monthly declaration of personal income tax, except for the cases that satisfy the conditions for quarterly declaration as follows:
- Competent state agencies, state administrative agencies, specialized attached agencies of People's Committees at all levels, professional career units, Party agencies, social-political organizations...arising incomes from salaries, and wages but not generating incomes from goods and services.
- Taxpayers have a total turnover of up to VND 50 billion from the sale of goods and provision of services in the preceding year.
- Individuals earning incomes from salaries or wages who directly make tax declarations with tax offices
- Taxpayers having just commenced operation or business activities.
2. Declaration and payment time for personal income tax withholding documents
Pursuant to Clause 1, Article 44 of the Law on tax administration 2019, the deadline for submitting tax declaration dossiers is as follows:
- For taxes declared and paid on a monthly basis: The 20th day of the month following the month in which the tax liability arises.
- For taxes declared and paid on a quarterly basis The last day of the first month of the quarter following the quarter in which the tax liability arises.
3. The fine for late submission of personal income tax declaration
Pursuant to Article 13, Decree No. 125/2020/ND-CP, the fine for late submission of personal income tax declaration is as follows:
(1) A warning for the late submission of the tax declaration dossier beyond the prescribed period from 01 day to 05 days under extenuating circumstances;
(2) A fine ranging from VND 02 - 05 million for overdue tax declaration dossier from 01 day to 30 days, except for case (1).
(3) A fine ranging from VND 05 - 08 million for overdue tax declaration dossier from 31 days to 60 days, except for the case.
Apart from the fine prescribed (1), (2), (3), the remedial measures include forcible full payment of the late-payment interests into the state budget, for the acts of violation.
(4) A fine ranging from VND 08 - 15 million for the acts as follows:
- For the acts of late submission of the tax declaration dossier beyond the prescribed period from 61 days to 90 days;
- Submitting the tax declaration dossier beyond the prescribed period for 91 days or more without arising payable tax amount;
- Failing to submit the tax declaration dossier without arising payable tax amount (*)
- Failing to submit appendices as prescribed by regulations on tax administration together with the enterprise income tax finalization dossier, for enterprises that have transfer pricing transactions (**)
Apart from the fine, the remedial measures include forcible full payment of the late-payment interests into the state budget, for the acts of violation.
Note: The case (*) and (**) must submit the tax declaration dossier and appendices attached with the tax declaration dossier.
(5) A fine ranging from VND 15 - 25 million shall be imposed for the acts of submitting tax declaration dossiers past 90 days from the date of expiration of the time limit for submission of tax declaration dossiers, with incurred payable tax amount, and the taxpayer has fully paid tax amounts and late-payment interests into the state budget before the tax agency announces tax examination or tax inspection decisions or makes written records of late submission of tax declaration dossiers.
Note: When applying provisions specified in (4), if the fine is higher than the tax amount arising on the tax declaration dossier, the maximum fine for such case shall be equal to the payable tax amount arising on the tax declaration dossier, but not less than VND 11.5 VND.
Apart from the fine, the remedial measures include forcible full payment of the late-payment interests into the state budget, for the acts of violation.
Here is the answer to the question Does the tax collection subject to monthly or quarterly declaration?
