Công văn 13762/CTHN-HKDCN năm 2023 về quyết toán thuế thu nhập cá nhân năm 2022 do Cục Thuế thành phố Hà Nội ban hành

Pursuant to the Resolution No. 954/2020/UBTVQH14 dated June 02, 2020 of the Standing Committee of National Assembly of Vietnam on changes in exemptions upon calculation of personal income tax (PIT); the Law on tax administration No. 38/2019/QH14 dated June 13, 2019 promulgated by the National Assembly of Vietnam; the Government’s Decree No. 126/2020/ND-CP dated October 19, 2020;

Pursuant to the Circular No. 111/2013/TT-BTC; Article 14 of the Circular No. 92/2015/TT-BTC of the Ministry of Finance of Vietnam; the Circular No. 80/2021/TT-BTC dated September 29, 2021 of the Ministry of Finance of Vietnam; the Circular No. 79/2022/TT-BTC dated December 30, 2022 amending Point g Clause 1 Article 9 of the Circular No. 111/2013/TT-BTC dated August 15, 2013 of the Ministry of Finance of Vietnam; and Decision No. 40/QD-BTC dated January 13, 2023 of the Ministry of Finance of Vietnam;

For the purpose of uniform implementation of regulations of law on taxation in force, Hanoi City Department of Taxation hereunder gives some guidelines for PIT finalization in 2022 for regulatory authorities, public administrative units, organizations, enterprises, business organizations, and individuals paying income to their employees or workers (hereinafter referred to as "income payer”) and individuals who themselves complete tax finalization procedures.

I. ENTITIES MAKING PIT FINALIZATION

1. Individuals directly finalizing PIT with tax authorities

A resident who earns salaries/wages from two or more sources but is ineligible for authorization to finalize PIT as prescribed (cases of authorization to finalize PIT are specified in Point 3 Section I of this document) shall directly submit the PIT finalization dossier to the tax authority if his/her PIT is underpaid or overpaid and he/she claims a refund or has it carried forwards to the next period.

If an individual has been present in Vietnam for fewer than 183 days in the first calendar year but more than 183 days in 12 consecutive months from the date of his/her arrival, the first PIT finalization year is the period of 12 consecutive months from the date of his/her arrival.

An individual that is a foreigner whose employment contract in Vietnam has ended shall submit a tax finalization dossier to the tax authority before exit. If he/she has not completed PIT finalization procedures with the tax authority, he/she may authorize the income payer or another entity to complete PIT finalization procedures with the tax authority as per regulations. The income payer or the authorized entity must pay tax arrears if tax is underpaid or will receive a refund in case tax is overpaid.

A resident who earns salaries/wages from a foreign country or paid by an international organization, Embassy or Consulate and has not had his/her PIT deducted during the year shall directly submit the PIT finalization dossier to the tax authority if his/her PIT is underpaid or overpaid and he/she claims a refund or has it carried forwards to the next period.

A resident salary earner who is eligible for tax reduction due to natural disaster, conflagration, accident, or fatal disease shall finalize PIT himself/herself instead of authorizing the income payer to perform this task.

2. Income payers

Income payers shall declare and finalize PIT on behalf of authorizing individuals, whether PIT is deducted or not. If an individual authorizes the income payer to finalize PIT, has the tax arrears not exceeding VND 50.000 and is eligible for tax exemption, the income payer shall still specify information about that individual in its PIT finalization dossier but shall not aggregate his/her tax arrears which is not exceeding VND 50.000.

In case an employee is re-assigned to a new organization after the old organization is acquired, consolidated, fully or partially divided, or converted, or to a new organization that is in the same system as the old organization, the new organization shall finalize PIT as authorized by such employee, including the income paid by the old organization, and collect the PIT withholding (deduction) document issued by the old organization to such employee (if any).

Where an income payer is dissolved, declared bankrupt, terminates its operation or a contract or undergoes restructuring, PIT shall be finalized up to the occurrence of such an event. In case of conversion (except equitized state-owned enterprises) where the enterprise after conversion inherits all tax obligations of the enterprise before conversion, PIT shall be finalized at the end of the year instead of the issuance date of the conversion decision.

3. Authorization to finalize PIT

A resident salary earner may authorize the income payer to finalize tax if:

- The salary earner has an employment contract with duration of at least 03 months and is working for the salary payer in reality when the salary payer carries out PIT finalization procedures, even if the salary earner has not worked for a full period of 12 months in the calendar year. An employee is re-assigned to a new organization after the old organization is acquired, consolidated, fully or partially divided, or converted, or to a new organization that is in the same system as the old organization, the employee may authorize the new organization to finalize PIT.

- The salary earner has an employment contract with a duration of at least 03 months and is working for the salary payer in reality when the salary payer carries out PIT finalization procedures, even if the salary earner has not worked for a full period of 12 months in the year, and earns an average monthly irregular income not exceeding VND 10 million on which 10% PIT has been deducted and does not wish to have this income included in the PIT finalization dossier.

- After the income payer completes PIT finalization procedures as authorized by an employee, if that employee is found to have to submit PIT finalization dossier to the tax authority himself/herself, the income payer must not adjust its PIT finalization dossier but shall issue that employee with the PIT deduction document whose bottom left corner bears the following contents: “Company…..has finalized PIT on behalf of Mr./Mrs. ..... (according to the power of attorney) at the line (ordinal number)…. of the List No. 05-1/BK-TNCN” to that employee for finalizing PIT with tax authority. In case of electronic PIT deduction document, the income payer shall print the original copy of that electronic PIT deduction document and write the abovementioned contents on the printed certificate before it is delivered to the employee.

II. ENTITIES THAT ARE NOT REQUIRED TO FINALIZE PIT

1. For individuals

Salary earners must not finalize PIT in the following cases:

- After finalizing PIT, the salary earner has the PIT arrears of not exceeding VND 50.000. In this case, the salary earner shall himself/herself determine the PIT amount exempt and is not required to submit the PIT finalization dossier and application for tax exemption;

- The amount of PIT payable is smaller than the amount provisionally paid but the salary earner does not claim a refund or does not have it carried forward to the next period;

- In case a salary earner has entered into an employment contract with duration of at least 03 months with an employer and earns an average monthly irregular income not exceeding VND 10 million on which 10% PIT has been deducted, the PIT on this income shall not be finalized if not requested by that salary earner.

- If a salary earner’s life insurance (except voluntary retirement insurance) or any other type of voluntary insurance with insurance premium accumulation is purchased by his/her employer and 10% PIT on the part purchased or contributed by the employer has been deducted, that salary earner must not finalize PIT on this part.

2. For income payers

PIT finalization is not required if an income payer does not pay any income or has its business suspended throughout a calendar year.

III. EXEMPTIONS UPON PIT CALCULATION

1. Exemptions

Pursuant to the Resolution No. 954/2020/UBTVQH14 dated June 02, 2020 of the Standing Committee of National Assembly of Vietnam, a taxpayer may claim the following exemptions upon PIT calculation:

- Personal exemption: VND 11 million/month (VND 132 million/year);

- Dependency exemption: VND 4,4 million/month/qualifying dependent.

2. Dependency exemptions

In order to claim dependency exemptions, a taxpayer must follow procedures for registration of his/her dependents as prescribed. If dependency exemptions are not yet claimed in the tax year, the taxpayer’s dependency exemptions will be calculated from the month in which the support obligation is incurred when the taxpayer carries out PIT finalization procedures, provided that the taxpayer has successfully completed procedures for registration of his/her dependents.

In case a taxpayer incurs support obligations towards other helpless dependents as prescribed in Paragraph d.4 Point d Clause 1 Article 9 of the Circular No. 111/2013/TT-BTC dated August 15, 2013 of the Ministry of Finance of Vietnam (such as biological siblings, paternal or maternal grandparents or aunts, etc.), he/she must complete procedures for registration of dependents by December 31 of the tax year. After this deadline, the taxpayer may not claim dependency exemptions in that tax year.

If dependency exemptions of a taxpayer who authorizes the income payer to finalize PIT are not yet claimed in the tax year, the taxpayer’s dependency exemptions will be also calculated from the month in which the support obligation is incurred when the taxpayer authorizes the income payer to finalize PIT, provided that the taxpayer has completed procedures for registration of his/her dependents through the income payer.

If an employee works at a dependent unit or business location located in a province but receives salaries/wages by the headquarters located in another province, he/she may follow procedures for registration of dependents with the supervisory tax authority of either the headquarters or the dependent unit or business location where he/she is working. If procedures for registration of dependents are followed with the supervisory tax authority of the dependent unit or business location, this dependent unit or business location shall transfer all documents proving the employee’s qualifying dependents to the headquarters. The headquarters shall review and retain these documents as prescribed and present them to tax authorities during their tax inspections.

During the application of dependency exemptions, if the taxpayer increases or decreases the number of his/her dependents or changes to a new workplace, he/she must follow procedures for registration of dependents as the first time (as prescribed in Paragraph h.2.1.1.1, Point h Clause 1 Article 9 of the Circular No. 111/2013/TT-BTC dated August 15, 2013 of the Ministry of Finance of Vietnam).

3. Documents required for registration of dependents

a) If a taxpayer directly follows procedures with the tax authority, an application for registration of dependents includes:

- The application form made using Form No. 07/DK-NPT-TNCN in Appendix II enclosed with the Circular No. 80/2021/TT-BTC dated September 29, 2021 of the Ministry of Finance of Vietnam.

- Documents proving qualifying dependents as prescribed in Article 1 of the Circular No. 79/2022/TT-BTC dated December 30, 2022 of the Ministry of Finance of Vietnam.

- The written certification, made using Form No. 07/XN-NPT-TNCN in Appendix II enclosed with the Circular No. 80/2021/TT-BTC dated September 29, 2021 of the Ministry of Finance of Vietnam, given by the People's Committee of commune/ward where the dependent resides, if the taxpayer has direct custody of a dependent.

b) If a taxpayer follows procedures for registration of dependents through the income payer, he/she shall submit the application, including the documents specified in Point a Clause 3 Section III hereof, to the income payer. The income payer shall complete the list of employees requesting registration of dependents, using Form No. 07/THDK-NPT-TNCN in Appendix II enclosed with the Circular No. 80/2021/TT-BTC dated September 29, 2021 of the Ministry of Finance of Vietnam, and send it to the tax authority as prescribed.

IV. PIT FINALIZATION PROCEDURES

1. PIT declaration

1.1. PIT finalization dossier

a) If an individual directly finalizes PIT with the tax authority, the PIT finalization dossier includes:

+ The PIT return made using Form No. 02/QTT-TNCN in Appendix II enclosed with the Circular No. 80/2021/TT-BTC dated September 29, 2021 of the Ministry of Finance of Vietnam.

+ The list of qualifying dependents made using Form No. 02-1/BK-QTT-TNCN in Appendix II enclosed with the Circular No. 80/2021/TT-BTC dated September 29, 2021 of the Ministry of Finance of Vietnam.

+ Copies (photocopies) of documents proving the PIT amount deducted, provisionally paid in the year, or paid overseas (if any). If the income payer does not issue the PIT deduction document to the taxpayer because the income payer has been shut down, the tax authority shall consider processing the taxpayer’s PIT finalization dossier based on the database of tax authorities without requesting the taxpayer to submit a PIT deduction document. In case of electronic PIT deduction document, the taxpayer shall submit the printed physical copy of the original electronic PIT deduction document provided by the income payer.

+ The copy of the PIT deduction certificate (specifying the PIT return number) issued by the income payer or the copy of a bank’s notice of overseas PIT payment which must bear the taxpayer's certification in case a foreign tax authority is not required to issue a certificate of PIT payment in accordance with the domestic law of that foreign country.

+ Copies of invoices proving the contributions to charity funds, humanitarian funds, or scholarship funds (if any).

+ Documents proving amounts paid by overseas income payer, if the taxpayer earns income from an international organization, Embassy, Consulate and other income from abroad.

+ Application for registration of dependents as prescribed in Point a Clause 3 Section III hereof (if the taxpayer claims dependency exemptions for unregistered dependents when following PIT finalization procedures).

b) The PIT finalization dossier submitted by an income payer includes:

+ The PIT return made using Form No. 05/QTT-TNCN in Appendix II enclosed with the Circular No. 80/2021/TT-BTC dated September 29, 2021 of the Ministry of Finance of Vietnam.

+ List of employees paying progressive PIT, made using Form No. 05-1/BK-QTT-TNCN in Appendix II enclosed with the Circular No. 80/2021/TT-BTC dated September 29, 2021 of the Ministry of Finance of Vietnam.

+ List of employees paying proportional PIT, made using Form No. 05-2/BK-QTT-TNCN in Appendix II enclosed with the Circular No. 80/2021/TT-BTC dated September 29, 2021 of the Ministry of Finance of Vietnam.

+ The list of employees claiming dependency exemptions, made using Form No. 05-3/BK-QTT-TNCN in Appendix II enclosed with the Circular No. 80/2021/TT-BTC dated September 29, 2021 of the Ministry of Finance of Vietnam.

c) If an individual authorizes the income payer to finalized PIT, he/she shall make a letter of authorization to finalize PIT for the tax period of 2022, using Form No. 08/UQ-QTT-TNCN in Appendix II enclosed with the Circular No. 80/2021/TT-BTC dated September 29, 2021 of the Ministry of Finance of Vietnam.

1.2. PIT finalization dossier supplementation

- If the supplementation does not lead to a change in tax obligations, only a written explanation and relevant documents are required while a supplementary PIT return is not required.

- If the annual PIT finalization dossier has not been submitted, the taxpayer shall provide supplementary PIT documents of the erroneous month or quarter and include the rectification in the annual PIT finalization dossier.

- If the annual PIT finalization dossier has been submitted:

+ The individual who directly submits the PIT finalization dossier shall only provide the supplementation to the annual PIT finalization dossier.

+ The income payer shall provide the supplementation to its annual PIT finalization dossier and the erroneous monthly or quarterly PIT return.

2. Submission of PIT finalization dossiers

PIT finalization dossiers shall be submitted in accordance with the provisions of Clause 8 Article 11 of the Government’s Decree No. 126/2020/ND-CP dated October 19, 2020. In case an individual declares and submits PIT finalization dossier through the website: https://canhan.gdt.gov.vn, the tax authority shall be determined by the system based on the information about tax obligations incurred in the year provided by that individual.

PIT finalization dossiers will be submitted as follows:

2.1. Income payers shall submit PIT finalization dossiers to their supervisory tax authorities.

2.2. For individuals directly finalizing PIT with tax authorities

- A resident who earns salaries/wages in one location and declares PIT themself shall submit PIT finalization dossier to the tax authority to which tax declarations are submitted during the year as prescribed in Point a Clause 8 Article 11 of Decree No. 126/2020/ND-CP. In case an individual earns salaries/wages in more than one location, including income on which PIT is declared directly and income on which PIT has been deducted by the income payer, the PIT finalization dossier shall be submitted to the tax authority of the location from which he/she earns the highest income. In case the highest income cannot be determined, the PIT finalization dossier shall be submitted to the supervisory tax authority of the salary payer or the area where the individual resides.

- In case a resident earning salaries/wages from more than one source on which PIT has been withheld (or deducted) at source by salary payers:

+ The PIT finalization dossier shall be submitted to the supervisory tax authority of the salary payer where his/her personal exemption is claimed. In case his/her workplace is changed and his/her personal exemption is claimed at the last salary payer, the PIT finalization dossier shall be submitted to the supervisory tax authority of such salary payer. In case his/her workplace is changed but his/her personal exemption is not claimed at the last salary payer, the PIT finalization dossier shall be submitted to the supervisory tax authority of the area where he/she resides. In case his/her personal exemption has not been claimed at any salary payer, the PIT finalization dossier shall be submitted to the supervisory tax authority of the area where he/she resides.

+ In case a resident does not have an employment contract or has an employment contract with duration of less than 03 months or has a service contract and earns income at one location or more from which 10% PIT has been deducted, the PIT finalization dossier shall be submitted to the tax authority of the area where he/she resides.

+ In case a resident earns salaries/wages at one location or more but is not working for any salary payer when the PIT finalization dossier is being prepared, the PIT finalization dossier shall be submitted to the tax authority of the area where he/she resides.

- In case a resident salary earner who has to finalize PIT directly with the tax authority applies for PIT reduction due to natural disaster, conflagration, accident, or fatal disease, the PIT finalization dossier shall be submitted to the tax authority to which his/her application for PIT reduction has been submitted. The tax authority that has processed the application of PIT reduction shall take charge of processing the PIT finalization dossier.

V. DEADLINES FOR SUBMISSION OF PIT FINALIZATION DOSSIERS

Pursuant to Point a, Point b Clause 2 Article 44 of the Law on Tax Administration No. 38/2019/QH14 of the National Assembly of Vietnam, PIT finalization dossiers must be submitted by the following deadlines:

- Income payers shall submit PIT finalization dossiers by the last day of the 03^rd month from the end of the calendar year.

- Individuals who themselves finalize PIT shall submit PIT finalization dossiers by the last day of the 04^th month from the end of the calendar year. If an individual has PIT refund but fails to submit the PIT finalization dossier by the prescribed deadline, no administrative penalty for such late submission will be imposed.

- If the deadline for submission of PIT finalization dossier falls on days off or holidays as prescribed, the deadline shall be the business day following that day off or holiday as prescribed by the Civil Code.

- In summary, PIT finalization dossiers for the tax period of 2022 shall be submitted by March 31, 2023, for income payers, or by May 04, 2023, for individuals who directly finalize PIT with tax authorities.

VI. OTHER CAUTIONS

1. Income payers must fully specify taxpayer identification numbers (TINs) of taxpayers listed in their submitted PIT returns which are made using the form enclosed with the Circular No. 80/2021/TT-BTC dated September 29, 2021 of the Ministry of Finance of Vietnam.

2. An income payer shall declare all individuals to whom it pays incomes which are subject to PIT, including those having incomes below the taxable level and an individual who earns only taxable income on which 10% PIT is deducted but total taxable income estimated after deduction of taxpayer’s exemptions is below the taxable level (as prescribed in Point i Clause 1 Article 25 of the Circular No. 111/2013/TT-BTC dated August 15, 2013 of the Ministry of Finance of Vietnam).

3. Currently, tax authorities have been adopting measures for disseminating information to and instructing individual taxpayers that are ineligible to authorize income payers to finalize PIT on their behalf to directly declare and pay PIT as prescribed. Income payers are requested to instruct these individual taxpayers to learn about and strictly comply with regulations on entities directly finalizing PIT with tax authorities so as to avoid committing administrative violations as prescribed by laws. Additionally, income payers must fully and promptly issue PIT deduction documents to serve these individual taxpayers’ completion of direct PIT finalization procedures with tax authorities ( as prescribed in Clause 2 Article 4 of the Decree No. 123/2020/ND-CP dated October 19, 2020).

4. When following direct PIT finalization procedures with tax authorities, individual taxpayers are required to provide adequate information on their income payers (if any) on Form No. 02/QTT-TNCN as the basis for tax authorities to promptly and properly determine jurisdiction to process their PIT finalization dossiers.

Individuals are encouraged to declare PIT online (according to guidelines given in the Official Dispatch No. 535/TCT-DNNCN dated March 03, 2021 of the General Department of Taxation) and make online PIT payments via applications for mobile devices (according to guidelines given in the Official Dispatch No. 4899/TCT-CNTT dated December 14, 2021). Details of software programs and accompanying installation instructions, and guidelines for registration of accounts for conducting electronic transactions, declaring and finalizing PIT are available on the website of Hanoi City Department of Taxation (http://hanoi.gdt.gov.vn) to serve individual taxpayers and income payers’ completion of online PIT finalization procedures.

Taxpayers should report any difficulties that arise during the implementation of this document to their supervisory tax authorities for specific guidance and assistance./.