Chương II Thông tư 28/2011/TT-BTC: Khai thuế, tính thuế

Chapter II

TAX DECLARATION AND CALCULATION

Article 9. General provisions on tax declaration and calculation

1. Principles for tax calculation and declaration

a/ Taxpayers shall calculate tax amounts payable into the state budget by themselves, except the case in which tax agencies assess or calculate tax under Articles 37 and 38 of the Law on Tax Administration.

b/ Taxpayers shall accurately, honestly and fully fill in tax returns to be submitted to tax agencies according to forms set by the Ministry of Finance and submit all documents required for tax declaration dossiers.

c/ For taxes to be declared on a monthly, quarterly or yearly basis, if no tax obligation arises in a tax period or taxpayers are currently eligible for tax incentives, exemption or reduction, taxpayers shall still submit tax declaration dossiers to tax agencies within the set time limit, except for cases in which activities that give rise to the tax obligation have terminated and cases in which business operations are suspended under Point e, Clause 1 of this Article.

d/ For taxes to be declared on a monthly or quarterly basis, the first tax period is counted from the date of commencement of activities that give rise to the tax obligation to the last day of the month or quarter, and the last tax period is counted from the first day of a month or quarter to the date of termination of activities that give rise to the tax obligation. The annual tax period for enterprise income tax or royalty is counted according to the calendar year or the fiscal year applied by taxpayers. The annual tax period for other taxes is the calendar year.

e/ Taxpayers are not required to submit tax declaration dossiers for the period in which business operations are suspended and no tax obligation arises.

Within 5 days before suspending their business operations, taxpayers shall send a written notice to their managing tax agencies. Such a notice must contain the following details:

- The taxpayer's name, office address and tax identification number;

- The duration of business suspension, the first day and last day of the suspension period;

- Reasons for business suspension;

- The full name and signature of the enterprise's at-law representative, representative of the group of business individuals or head of the business household.

Upon expiration of the business suspension period, the taxpayer shall declare tax according to regulations. In case a taxpayer resumes its business operations before the expiration of the notified business suspension period, it shall send a written notice thereon to its managing tax agency and, at the same time, submit a tax declaration dossier under regulations.

2. Tax declaration dossiers:

A tax declaration dossier comprises a tax return and relevant documents serving as grounds for the taxpayer to declare and calculate tax with a tax agency.

Taxpayers shall use the proper form of tax return and attached annexes set by the Ministry of Finance and may not change the format or add, put out or change the position of, any item in the tax return. Those kinds of paper in the tax dossier, of which forms are not set by the Ministry of Finance, must comply with relevant laws.

3. Deadlines for submission of tax declaration dossiers

a/ The deadline for submission of a monthly tax declaration dossier is the 20th of the month following the month in which the tax obligation arises.

b/ The deadline for submission of a quarterly tax declaration dossier is the 30th of the quarter following the quarter in which the tax obligation arises.

c/ The deadline for submission of an annual tax declaration dossier is the 30th of the first month of the calendar year or fiscal year.

d/ The time limit for submission of a tax declaration dossier for each time of arising of a tax obligation is 10 days from the date the tax obligation arises.

e/ The time limit for submission of an annual tax finalization dossier is 90 days from the end of the calendar year or fiscal year.

f/ The time limit for submission of a tax finalization dossier in case of termination of operation, expiration of contract, enterprise ownership transformation or reorganization is 45 days from the date of termination, expiration, transformation or reorganization.

g/ The time limit for submission of dossiers for declaration of taxes or other levies on land use under the one-stop-shop mechanism is the time limit set in inter-disciplinary documents guiding this one-stop-shop mechanism.

4. Extension of time limits for submission of tax declaration dossiers:

a/ Taxpayers who are unable to submit their tax declaration dossiers on time due to natural disasters, fires or accidents may enjoy an extension of the time limit for submission of tax declaration dossiers given by heads of tax agencies directly managing them.

b/ An extension must not exceed 30 days from the original deadline for submission of tax declaration dossiers, for the submission of dossiers for monthly or annual tax declaration, quarterly declaration of temporarily calculated tax or tax declaration for each time of arising of a tax obligation; or 60 days from the original deadline for submission of tax finalization declaration dossiers.

c/ Before the expiration of a time limit for submission of tax declaration dossiers, taxpayers shall send written requests for extension of the time limit to tax agencies that have received tax declaration dossiers, clearly stating the reason for extension, which are certified by People's Committees or police offices of communes, wards or townships in which the events that necessitate the extension occur.

d/ Within 5 working days after receiving written requests for extension of the time limit for submission of tax declaration dossiers, tax agencies shall reply in writing taxpayers whether they approve the extension. If tax agencies make no written reply, taxpayers' requests are considered approved.

5. Making additional declarations to tax declaration dossiers:

a/ Past the time limit for submission of tax declaration dossiers, if taxpayers detect errors in tax declaration dossiers already submitted to tax agencies which affect the payable tax amount, they may make additional declarations to these tax declaration dossiers. Additional tax declaration dossiers may be submitted to tax agencies on any working day, not depending on the time limit for submission of subsequent tax declaration dossiers, but must be submitted before tax agencies or competent agencies announce decisions on tax examination or inspection at taxpayers' offices.

b/ Forms of additional declaration dossiers:

- A written explanation of additional declarations or modifications, made according to form No. 01/KHBS provided in this Circular;

- A supplemented or modified tax return for the tax period for which supplementations or modifications must be made (this tax return shall serve as a basis for making the written explanation of additional declarations or modifications according to form No. 01/KHBS);

- Enclosed documents explaining figures in the written explanation of additional declarations or modifications, corresponding to documents in a tax dossier guided in specific sections of this Circular.

c/ If additional declarations to tax declaration dossiers lead to an increase in the payable tax amount or a decrease in the refunded tax amount, taxpayers shall, based on the dossiers of additional declarations or modifications, pay the increased tax amount or repay the refunded tax amount and, at the same time, determine by themselves the fine amount for late tax payment based on the lately paid tax amount or the refunded tax amount, the number of days of late payment and fine level specified in Article 106 of the Law on Tax Administration and Article 12 of Decree No. 98/2007/ND-CP.

If taxpayers cannot determine by themselves or incorrectly determine fine amounts for late tax payment, tax agencies shall determine and notify these fine amounts to taxpayers for payment.

Example 1:

In August 2011, Company A makes additional declarations or modifications to the VAT declaration dossier of January 2011, leading to an increase of VND 100 million in the payable VAT amount, it shall pay the tax amount of VND 100 million and, at the same time, determine by itself the amount of fines for late tax payment into the state budget.

The dossier to be submitted by Company A to the tax agency comprises:

- A written explanation of additional declarations or modifications, made according to form No. 01/KHBS provided in this Circular, leading to an increase of VND 100 million in the payable VAT amount of January 2011;

- The VAT return of January 2011, in which the payable VAT amount has been increased by VND 100 million;

- Enclosed documents explaining figures in the additional declarations or modifications (if any).

Example 2:

In August 2011, Company B makes additional declarations or modifications to its EIT finafization declaration dossier of 2010, leading to an increase of VND 100 million in the payable EIT amount. In this case, Company B shall pay the tax amount of VND 100 million and, at the same time, determine by itself the fine amount for late payment based on the lately paid tax amount, the number of days of late payment and the prescribed fine level and pay this fine amount into the state budget.

The dossier to be submitted by Company B to the tax agency comprises:

- A written explanation of additional declarations or modifications, made according to form No. 01/KHBS provided in this Circular, leading to an increase of VND 100 million in the payable EIT amount of 2010;

- The EIT finafization return of 2010, in which the payable EIT amount has been increased by VND 100 million;

- Enclosed documents explaining figures in the written explanation of additional declarations or modifications (if any).

d/ If taxpayers' additional declarations or modifications to tax declaration dossiers lead to a decrease in their payable tax amount in the tax period for which additional declarations or modifications are made, taxpayers may clear the decreased tax amount against the payable tax amount of the subsequent tax period or carry out procedures for tax refund.

Example 1:

In August 2011, Company C makes additional declarations or modifications to the VAT declaration dossier of January 2011, leading to a decrease of VND 100 million to the payable VAT amount. In this case. Company C shall declare the decreased VAT amount of VND 100 million of January 2011 in the item -Decrease in payable VAT amounts of previous periods - of the VAT return of August 2011 (the month in which additional declarations or modifications are made) or compile a dossier for refund of the overpaid VAT amount.

The dossier to be submitted by Company C to the tax agency comprises:

- A written explanation of additional declarations or modifications, made according to form No. 01/KHBS provided in this Circular, leading to a decrease of VND 100 million in the payable VAT amount of January 2011;

- The VAT return of January 2011, in which the payable VAT amount has been decreased by VND 100 million;

- Enclosed documents explaining figures in the written explanation of additional declarations or modifications (if any).

Example 2:

In August 2011, Company D makes additional declarations or modifications to the excise tax declaration dossier of January 2011, leading to a decrease of VND 100 million in the payable excise tax amount. In this case, the taxpayer shall consider it an overpaid tax amount of January 2011 and may clear it against the payable excise tax amounts of subsequent tax periods or carry out procedures for tax refund.

The dossier to be submitted by Company D to the tax agency comprises:

- A written explanation of additional declarations or modifications, made according to form No. 01/KHBS provided in this Circular, leading to a decrease of VND 100 million in the payable excise tax amount of January 2011;

- The excise tax return of January 2011, in which the payable excise tax amount has been decreased by VND 100 million;

- Enclosed documents explaining figures in the written explanation of additional declarations or modifications (if any).

e/ The additional VAT declaration or modification in some specific cases are made as follows:

Case 1: In case taxpayers' additional declarations or modifications only lead to a decrease in the creditable value-added tax amount (without giving rise to any payable VAT amount), after making additional declarations or modifications, taxpayers are not required to additionally pay tax and fines for late tax payment. The uncreditable VAT amount of the period for which additional declarations or modifications are made shall be declared in the item - Increase in payable VAT amounts of previous periods - of the VAT return of the tax period during which additional declarations or modifications are made.

Example 1:

In August 2011, Company E makes additional declarations or modifications to its VAT declaration dossier of January 2011, leading to a decrease in the creditable VAT amount from VND 200 million to VND 100 million (a decrease of VND 100 million in the credited tax amount). In this case, the taxpayer is not required to pay the VAT amount of VND 100 million and calculate fines for late tax payment but it shall declare the uncreditable VAT amount of January 2011 in the VAT return of August 2011, the month when additional declarations or modifications are made (making additional declarations or modifications in item - Increase in the VAT amounts of previous periods).

The dossier to be submitted by Company E to the tax agency comprises:

- A written explanation of additional declarations or modifications, made according to form No. 01/KHBS provided in this Circular, leading to a decrease of VND 100 million in the creditable VAT amount of January 2011;

- The VAT return of January 2011, in which the creditable VAT amount has been decreased by VND 100 million;

- Enclosed documents explaining figures in the explanation of additional declarations or modifications (if any).

Case 2: In case taxpayers' additional declarations or modifications only lead to a decrease in the creditable VAT amount for which the taxpayers have compiled a dossier of application for tax refund and the tax agency has issued a tax refund decision. In this case, taxpayers shall base on dossiers of additional declarations or modifications to repay the refunded tax amount and, at same time, determine the fine amount for late tax payment on the basis of the lately paid tax amount, the number of days of late payment (the duration for calculation of fines for late payment shall be counted from the date the tax agency issues the tax refund decision till the date the enterprise repays the. refunded tax amount) as prescribed in Article 106 of the Law on Tax Administration.

Example 2:

On the VAT return of March 2011, Company F requests to halt the credit of the negative accumulative VAT amount of VND 500 million of 3 consecutive months (from January to March 2011) to make a VAT refund dossier and the tax agency has made a decision to refund the VAT amount of 500 million. In August 2011, Company F makes a dossier of additional declarations or modifications to the VAT declaration dossier of January 2011, leading to a decrease of VND 200 million in the creditable VAT amount to be cleared against the payable tax amount of the subsequent period. In this case, Company F shall repay the refunded tax amount of VND 200 million and calculate and pay fines for late tax payment according to Article 106 of the Law on Tax Administration.

The dossier to be submitted by Company F to the tax agency comprises:

- A written explanation of additional declarations and modifications, made according to form No. 01/KHBS provided in this Circular, leading to a decrease of VND 200 million in the creditable VAT amount of the January 2011 tax period which is to be cleared against the payable tax amount of the subsequent period;

- The VAT return of January 2011, in which the creditable VAT amount to be cleared against the payable tax amount of the subsequent period has been decreased to VND 2(X) million;

- Enclosed documents explaining figures in the explanation of additional declarations or modifications (if any).

Case 3: If taxpayers' additional declarations or modifications lead to a decrease in the creditable VAT amount and an increase in the payable VAT amount, taxpayers shall pay the increased tax amount and, at the same time, determine the fine amount for late tax payment on the basis of the lately paid tax amount, the number of days of late payment and me fine level as prescribed. After making additional declarations or modifications, taxpayers are not required to additionally pay the creditable VAT amount which is decreased and calculate and pay fine for late tax payment. The uncreditable VAT amount shall be declared in item - Increase in VAT amounts of previous periods - in the VAT return of the period during which additional declarations or modifications are made.

Example 3:

In August 2011, Company G makes additional declarations or modifications to its VAT declaration dossier of January 2011, leading to a decrease of VND 200 million in the creditable VAT amount to be cleared against the payable tax amount of the subsequent period and an increase of VND 100 million in the payable VAT amount (under the VAT return of January 2011, the VAT amount not yet credited and cleared against the subsequent period is VND 200 million, now the uncreditable VAT amount decreases to VND 300 million, giving rise to a payable VAT amount of VND 100 million under the VAT return of January 2011). In this case, the taxpayer shall pay the increased VAT amount of VND 100 million and calculate and pay fines for late tax payment. The uncreditable VAT amount of VND 200 million shall be declared in the VAT return of August 2011, the month of making additional declarations or modifications (in item - Increase in VAT amounts of previous periods).

The dossier to be submitted by Company G to the tax agency comprises:

- For modifications which lead to an increase of VND 100 million in the payable VAT amount of January 2011: When detecting errors, Company G shall make additional declarations or modifications to pay the increased tax amount of VND 100 million and a fine for late payment. The dossier of additional declarations or modifications to be submitted to the tax agency comprises:

+ A written explanation of additional declarations or modifications to the VAT return of January 2011, made according to form No. 01/KHBS;

+ The VAT return of January 2011, in which the payable VAT amount is increased by VND 100 million;

+ Enclosed documents explaining figures in the written explanation of additional declarations or modifications (if any).

- For modifications which lead to a decrease of VND 200 million in the creditable VAT amount of January 2011: Company G shall make modifications in the VAT return of August 2011 and enclose to the VAT declaration dossier of August 2011 submitted to the tax agency copies of the written explanation of additional declarations or modifications to the VAT return of 2011, made according to form No. 01/KHBS, and the modified VAT return of January 2011 already submitted.

Example 4: After submitting VAT dossiers to tax agencies, if taxpayers detect errors which should be additionally declared or modified but additional declarations or modifications do not lead to any increase or decrease of the payable VAT amount (errors in turnover of goods and services sold or purchased, etc.), they shall make a written explanation and a new VAT return for submission as replacement but are not required to make a dossier of additional declarations or modifications according to form No. 01/KDBS.

Tax agencies shall base themselves on taxpayers' written explanations to modify the figures according to taxpayers' additional declarations or modifications.

6. Places of submission of tax declaration dossiers:

Taxpayers shall submit tax declaration dossiers; dossiers of declaration of charges, fees and other state budget revenues at their managing tax agencies. The places of submission of tax declaration dossiers in some cases are specified as follows:

a/ Dossiers of declaration of house and land tax, agricultural land use tax, land use levy and land rent; dossiers of declaration of registration fee; dossiers of declaration of VAT on extra-provincial business operations and dossiers of presumptive tax declaration shall be submitted at district-level Tax Departments of localities in which such taxes arise.

b/ For royalty declaration dossiers, enterprises exploiting natural resources in provinces or cities in which they are headquartered shall submit dossiers at their managing tax agencies (provincial- or district-level Tax Departments). Taxpayers based in provinces or cities different from the localities in which they exploit natural resources shall submit dossiers at the provincial-level Tax Departments of the localities in which natural resources exploitation activities are carried out or district-level Tax Departments designated by directors of such provincial-level Tax Departments.

c/ For dossiers of enterprise income tax on real estate transfer, enterprises headquartered in the provinces or cities in which they carry out real estate transfer activities shall submit dossiers at their managing tax agencies (provincial- or district-level Tax Departments). Taxpayers that carry out real estate transfer activities in provinces and cities other than the localities in which they are headquartered shall submit dossiers at the provincial-level Tax Departments of the localities in which real estate transfer activities are carried out or district-level Tax Departments designated by the directors of such provincial-level Tax Departments.

d/ For excise tax declaration dossiers, taxpayers whose establishments producing goods liable to excise tax are located in provinces or cities other than the localities in which they are headquartered shall submit dossiers in the localities in which their production establishments are located.

e/ In case state management agencies in a locality have stipulated the coordination in the settlement of administrative procedures, providing for the application of the one-stop-shop mechanism to tax procedures and declaration dossiers, the places of submission of tax declaration dossiers comply with the prescribed order and procedures.

Article 10. Declaration of VAT

1. Responsibility to submit VAT declaration dossiers to tax agencies:

a/ Taxpayers shall submit VAT declaration dossiers to their managing tax agencies.

b/ A taxpayer that has a subsidiary conducting business in a province or city in which its head office is located shall also declare VAT for its subsidiary.

In case a subsidiary which has its own seal and bank deposit account, directly sells goods or services and declares fully input and output VAT wishes to make separate tax declaration and payment, it shall register for separate tax payment and use separate invoices.

Based on practical situation in the localities under their management, directors of provincial-level Tax Departments are assigned to decide on places of tax declaration for taxpayers dealing in food catering services, restaurants, hotels, massage and karaoke services.

c/ In case a taxpayer has subsidiaries conducting business in provinces or cities other than the locality in which its head office is located, these subsidiaries shall submit VAT declaration dossiers to their managing tax agencies. Tax declaration for subsidiaries which do not directly sell goods and have no turnover shall be made concentradedly at taxpayers' head offices.

d/ In case a taxpayer that declares and pays tax by the credit method has subsidiary production establishments (including processing and assembly establishments) located in provinces or cities other than the locality in which its head office is located and these subsidiaries do not directly sell goods and have no turnover:

Cost-accounting subsidiary production establishments shall register for tax payment by the credit method in the localities in which production activities are carried out. When ex-warehousing semi-finished products or finished products for sale, including cases of transferring them to the head office, they shall use value-added invoices as a basis for making tax declaration and payment in localities in which production activities are carried out.

In case subsidiary production establishments do not conduct cost accounting, taxpayers shall declare taxes at their head offices and pay taxes to localities in which these subsidiary production establishments are located. The VAT amounts to be paid to localities in which subsidiary production establishments are located shall be determined at the rate of 2% (for goods liable to the VAT rate of 10%) or 1% (for goods liable to the VAT rate of 5%) of the turnover calculated based on VAT-exclusive prices of manufactured products or similar products available in the localities in which production establishments are located.

In case the total VAT amount to be paid to localities in which a taxpayer's subsidiary production establishments are located which is determined on the aforesaid principle is larger than the VAT tax amount to be paid by the taxpayer at its head office, the taxpayer shall allocate the tax amount to be paid to localities in which their subsidiary production establishments are located as follows: the VAT amount to be paid to a locality in which a subsidiary production establishment is located is determined as being equal to (=) the VAT amount to be paid by the taxpayer at its head office multiplied (x) by the proportion (%) of turnover calculated based on VAT-exclusive prices of products manufactured by the subsidiary production establishment or similar products in the local market to the total turnover calculated based on VAT-exclusive prices of products manufactured by the enterprise. In case the taxpayer has no tax amount to be paid at its head office, it is required to pay tax to localities in which its production establishments are located.

The taxpayer shall make and send to the tax agency directly managing it a "Table of VAT amounts allocated to the locality in which the taxpayer is headquartered and localities in which its subsidiary production establishments which do not conduct the cost accounting are located", made according to form No. 01-6/GTGT provided in this Circular, together with the tax declaration dossier and, at the same time, send a copy of the aforesaid tax allocation table to each of tax agencies managing its subsidiary production establishments.

Based on VAT amounts allocated to the locality in which the taxpayer is headquartered and localities in which its subsidiary production establishments are located indicated in the aforesaid tax allocation table, the taxpayer shall make documents on the payment of VAT to each of these localities. The tax payment documents must clearly state that taxes are paid into the state budget revenue account at the State Treasury of the same level with the tax agency of the locality in which the taxpayer is headquartered and localities in which its subsidiary production establishments are located.

Example I: Company A, headquartered in Hanoi, has 2 subsidiary production establishments located in Hai Phong and Hung Yen which do not conduct the cost accounting. Manufactured products are subject to the VAT rate of 10% and sold by the head office.

In the tax declaration period of August 2011, the turnover of products manufactured in the Hai Phong-based plant which is calculated based on the VAT-exclusive price is VND 500 million; the turnover of products manufactured in the Hung Yen-based plant which is calculated based on the VAT-exclusive price is VND 600 million. The VAT amount to be paid at the head office of Company A (according to declaration form No. 01/GTGT) in the period is VND 25 million.

The VAT amount to be paid by Company A to Hai Phong is: VND 500 million x 2% = VND 10 million.

The VAT amount to be paid by Company A to Hung Yen is: VND 600 million x 2% = VND 12 million.

The VAT amount to be paid by Company A to Hanoi is: VND 25 million - 10 million - 12 million = VND 3 million.

Example 2: Company A, headquartered in Hanoi, has 3 subsidiary production establishments located in Hanoi, Hai Phong and Hung Yen which do not conduct the cost accounting. Manufactured products are sold by the head office.

In the tax declaration period of September 2011, the turnover of products manufactured in the Hai Phong-based plant which is calculated based on the VAT-exclusive price is VND 500 million; the turnover of products manufactured in the Hung Yen-based plant which is calculated based on.the VAT-exclusive price is VND 600 million; the turnover of products manufactured in the Hanoi-based plant which is calculated based on the VAT-exclusive price is VND 200 million. .

The VAT amount to be paid at the head office of Company A (according to declaration form No. 01/GTGT) in the period is VND 20 million.

Based on the aforesaid principle under which tax shall be temporarily paid to localities at the rate of 2% of turnover for goods liable to the VAT rate of 10%, Company A shall determine the VAT amounts to be paid to Hai Phong and Hung Yen as: VND 500 million x 2% + VND 600 million x 2% = VND 22 million. In this case, the tax amount to be paid to localities which is determined under this principle is higher than the VAT amount to be paid by Company A at its head office. Therefore, Company A shall distribute the VAT amount to be paid to localities as follows:

The VAT amount to be paid by Company A to Hai Phong is:

VND 20 million x 500 million/(500 million +600 million + 200 million) = VND 7.69 million.

The VAT amount to be paid by Company A to Hung Yen is:

VND 20 million x 600 million/(500 million + 600 million + 200 million) = VND 9.23 million.

The VAT amount to be paid by Company A to Hanoi is:

VND 20 million - 7.69 million - 9.23 million = VND 3.08 million.

Example 3:

Company A, headquartered in Hanoi, has 2 subsidiary production establishments located in Hai Phong and Hung Yen which do not conduct the cost accounting. Manufactured products are sold by the head office.

In the tax declaration period of October 2011, the turnover of products manufactured in the Hai Phong-based plant which is calculated based on the VAT-exclusive price is VND 400 million; the turnover of products manufactured in the Hung Yen-based plant which is calculated based on the VAT-exclusive price is VND 500 million. In October 2011, Company A has no payable tax amount at its head office. Company A, therefore, is not required to pay VAT to Hai Phong and Hung Yen.

e/ In case a taxpayer conducts business operations of construction, installation or goods sale without establishing subsidiaries in provinces or cities other than the locality in which it is headquartered (below referred to as extra-provincial mobile construction, installation or goods sale operations), the Taxpayer shall submit tax declaration dossiers to district-level Tax Departments of the localities in which construction, installation or goods sale operations are carried out.

f/ For extra-provincial construction and installation works, which are carried out in many localities, such as roads, power transmission lines, water, oil or gas pipelines, etc., thus making it impossible to determine the turnover in each district-level locality, taxpayers shall declare VAT on extra-provincial construction and installation turnover in VAT declaration dossiers at their head offices.

2. VAT declaration is made on a monthly basis. VAT declaration in some specific cases is provided as follows:

- Declaration of temporarily calculated VAT for each time of arising of a tax obligation, applicable to extra-provincial mobile construction, installation or goods sale business operations;

- Declaration of VAT for each time of arising of a tax obligation, applicable to VAT calculated directly on sale turnover of persons engaged in irregular business operations.

3. Declaration of VAT by the credit method:

a/ Taxpayers that calculate VAT by the tax

credit method include: business establishments and their subsidiaries conducting accounting and using invoices and documents according to the law on accounting, invoices and documents, except those applying the method of calculating tax directly on the added value defined in Clause 4 of this Article.

b/ A dossier of monthly declaration of VAT calculated by the tax credit method comprises:

- A VAT return, made according to form No. 01/GTGT provided in this Circular;

- A list of invoices of sold goods and services, made according to form No. 01-1/GTGT provided in this Circular;

- A list of invoices of purchased goods and services, made according to form No. 01-2/GTGT provided in this Circular;

- A list of sold cars and motorbikes, made according to form No. 01-3/GTGT provided in this Circular (applicable to establishments dealing in automobiles or motorbikes).

- A table of allocation of the creditable VAT amount of goods and services purchased in the month, made according to form No. 01-4/GTGT provided in this Circular (applicable to taxpayers that allocate the creditable VAT amount of the month according to the proportion (%) of turnover of sold VAT-liable goods and services to the total turnover of goods and services sold in the month);

- A declaration of modifications to the creditable input VAT amount of the year, made according to form No. 01-4/GTGT provided in this Circular (applicable to taxpayers that recalculate the creditable VAT amount of the year based on the proportion (%) of turnover of sold VAT-liable goods and services to the total turnover of goods and services sold in the year). Modifications (increase or decrease) to the creditable allocated VAT amount shall be summarized in the VAT return of December.

- A list of VAT amounts already paid for turnover from extra-provincial mobile construction, installation or goods sale, made according to form No. 01-5/GTGT provided in this Circular.

c/ In case a taxpayer paying VAT by the credit method has investment projects under construction in the province or city in which it is headquartered, it shall make separate tax declaration dossiers for these investment projects and clear the VAT amount of goods and services purchased for these investment projects against the VAT amount of ongoing production and business operations. After being cleared, if the remaining VAT amount of goods and services purchased for investment projects is VND 200 million or more, such VAT amount shall be refunded to investment projects.

In case a taxpayer has investment projects in provinces or cities other than the locality in which it is headquartered and these projects are under construction, have not yet been put into operation and have no business registration and tax registration, the taxpayer shall make separate tax declaration dossiers for these projects and submit these dossiers to the tax agency directly managing the head office. If the VAT amount of goods and services purchased for those investment projects is VND 200 million or more, it shall be refunded to investment projects. In case the taxpayer has issued decisions to establish project management units in provinces or cities other than the locality in which it is headquartered to manage, on its behalf, one or several investment projects in different localities, these project management units may make and send separate tax declaration dossiers to tax agencies of the localities in which they have made tax registration on the condition that they have their own seals according to law, keep accounting books and documents according to the accounting law, have bank deposit accounts and have made tax registration and been granted subsidiary tax identification numbers.

Particularly, business establishments conducting the cost accounting for all subsidiaries and having investment projects, including those in provinces or cities in which they are headquartered and those in other provinces or cities, shall make separate tax declaration dossiers for investment projects and clear the VAT amount of goods and services purchased for investment projects against the VAT amount of ongoing production and business operations. After being cleared, if the remaining VAT amount of goods and services purchased for investment projects is VND 200 million or more, such VAT amount shall be refunded to investment projects. Cases which are agreed by the Prime Minister or assigned to the Ministry of Finance for guidance shall comply with separate guidance of competent agencies.

A dossier of monthly declaration of VAT for investment projects comprises:

- A VAT return for the investment project, made according to form No. 02/GTGT provided in this Circular.

- A list of invoices and vouchers of purchased goods and services, made according to form No. 01-2/GTGT provided in this Circular.

4. Declaration of VAT calculated directly on the added value:

a/ Business households and individuals and taxpayers trading in gold, silver, gems or foreign currencies and keeping adequate purchase and sale invoices for determination of the added value may declare VAT tax calculated directly on the added value.

b/ Dossiers of monthly declaration of VAT calculated directly on the added value are the VAT returns made according to form No. 03/GTGT provided in this Circular.

Taxpayers may not carry forward the negative added value to the tax period of the subsequent month.

5. Declaration of VAT calculated directly on turnover:

a/ Business households, individuals and organizations that keep adequate invoices and vouchers of goods sold or services provided but do not have adequate purchase invoices and vouchers of input goods or services and, therefore, cannot determine the added value in the period may declare VAT calculated directly on turnover.

b/ Dossiers of monthly declaration of VAT calculated directly on turnover are VAT returns made according to form No. 04/GTGT provided in this Circular.

c/ Dossiers of VAT declaration for each time of arising a tax obligation calculated directly on turnover are VAT returns made according to form No. 04/GTGT provided in this Circular.

6. Declaration of VAT for extra-provincial mobile construction, installation or goods sale business operations.

a/ Taxpayers engaged in extra-provincial mobile construction, installation or goods sale business operations shall declare VAT temporarily calculated at the rate of 2% (for goods and services subject to the VAT rate of 10%) or 1% (for goods and services subject to the VAT rate of 5%) of VAT-exclusive goods and service turnover. Tax declaration shall be made with district-level Tax Departments of localities in which business operations are conducted or goods are sold.

b/ Dossiers of VAT declaration for extra-provincial mobile construction, installation or goods sale business operations are value-added tax returns, made according to form No. 06/GTGT provided in this Circular.

c/ Dossiers of VAT declaration for extra-provincial mobile construction, installation or goods sale business operations shall be submitted for each time of earning turnover. If tax declaration dossiers need to be submitted many times in a month, taxpayers may register for monthly submission of dossiers with district-level Tax Departments to which tax declaration dossiers are submitted.

d/ When declaring tax with their managing tax agencies, taxpayers shall summarize the whole amount of turnover earned from extra-provincial mobile construction, installation or goods sale business operations and VAT amounts paid for such turnover in tax declaration dossiers submitted at their head offices. The tax amount (according to tax receipts) paid for turnover from extra-provincial mobile construction, installation or goods sale shall be cleared against the payable VAT amount according to taxpayers' VAT return to be submitted at their head offices.

7. Change of applied VAT calculation methods.

a/ Cases of change of applied VAT calculation methods

Taxpayers currently applying the method of calculating VAT directly on the added value and satisfying all the conditions for application of the credit method specified at Point a, Clause 3 of this Article may send written requests, made according to form No. 06/GTGT provided in this Circular, to their managing tax agencies for permission to apply the credit method.

Taxpayers currently applying the method of calculating VAT directly on turnover and satisfying all the conditions for application of the method of calculating VAT directly on the added value specified at Point a, Clause 4 of this Article may send written requests, made according to form No. 06/GTGT provided in this Circular, to their managing tax agencies for permission to apply the method of calculating VAT directly on the added value.

b/ Within 10 working days after receiving taxpayers' written requests for change of VAT calculation methods, tax agencies shall check and reply in writing to taxpayers on approval or disapproval of taxpayers' requests. Taxpayers may change their tax calculation methods only after obtaining tax agencies' approval.

c/ If taxpayers that have changed, with tax agencies' approval, from the direct tax calculation method to the credit method or from the method of calculating tax directly on turnover to the method of calculating tax directly on the added value fail to maintain the required conditions in the course of application, their managing tax agencies shall apply the method of tax assessment and issue notices requiring them to apply an appropriate tax calculation method,

8. Guidance on declaration of VAT and making of lists of sale invoices and purchase invoices in some specific cases:

a/ Declaration of VAT for agency operations:

- Taxpayers being sale agents or purchase agents for goods or services that sell or purchase goods or services at prices set by their principals for commissions are not required to declare VAT on goods and service they sell or purchase but shall declare VAT on agency commission. Input and output invoices of sold and purchased goods and services shall be declared in a list according to form No. 01-1/GTGT or No. 01-2/GTGT; summarized figures on sold and purchased goods and services declared in these 2 forms may not used as a basis for making VAT returns.

- Taxpayers acting as agents in various forms shall declare VAT on goods or services sold or goods purchased and VAT on agency commissions.

- Taxpayers acting as ticket sale agents for post and telecommunications services, lottery tickets, airfares, car, train or ship fares that sell these services or fares at prices set by their principals for commissions; international transportation agents; agents of air and marine services subject to the VAT rate of 0%; and insurance agents are not required to declare VAT on turnover from goods or services sold and agency commissions.

- Taxpayers acting as sale agents for goods or services not liable to VAT are not required to declare VAT on turnover from those goods or services and agency commissions.

b/ Transport enterprises shall submit dossiers of declaration of VAT on transport business operations to their managing tax agencies.

c/ Taxpayers that calculate tax by the tax credit method and trade in gold, silver, gems and foreign currencies shall make VAT declaration as follows:

- For operations of dealing in goods or services on which tax is calculated by the credit method, taxpayers shall make tax declaration dossiers under Clause 3 of this Article.

- For operations of trading in gold, silver, gems and foreign currencies, taxpayers shall make tax declaration dossiers under Clause 4 or 5 of this Article.

d/ Taxpayers that provide financial leasing services are not required to submit VAT returns for these services but shall submit only lists of invoices of sold goods and services and lists of invoices of purchased goods and services, made according to forms No. 01 - 1/GTGT and No. 01-2/GTGT provided in this Circular, with the item of VAT on purchased goods or services filled in with the VAT amount of leased assets in conformity with the added value invoices made for turnover of financial leasing services in the period. Taxpayers shall submit tax declaration dossiers for their assets financially hired and purchased by other units.

e/ Tax declaration by taxpayers undertaking entrusted import or export of goods:

Establishments that undertake entrusted import or export of goods are not required to declare VAT on goods they have imported or exported under entrustment but shall declare VAT on entrustment remuneration. Input and output invoices of goods imported or exported under entrustment shall be declared in lists according to forms No. 01-1/GTGT and No. 01-2/GTGT; summarized figures on goods imported or exported under entrustment which are declared in these 2 forms must not be used as a basis for making VAT returns.

f/ Lists of purchased or sold goods or services provided in monthly tax returns submitted to tax agencies in some specific cases shall be made as follows:

- For goods and services retailed directly to consumers, such as electricity, water, petrol, oil, post and telecommunications services, hotel and food catering services, passenger transportation services, trading of gold, silver, gems and foreign currencies and other retailed goods and services, retail sale turnover may be declared in a total amount instead of amounts stated in separate invoices.

- For goods and services purchased in small quantities, general lists of different groups of goods or services subject to the same tax rate may be made instead of detailed listing according to separate invoices.

- For banking service establishments with subsidiaries located in the same locality, these subsidiaries shall make lists of purchased or sold goods and services for keeping at the head offices. When making general lists of purchased or sold goods and services, head offices shall sum up only aggregate figures on lists made by subsidiaries.

9. In case a business establishment authorizes a third party to make invoices for the sale of goods or services, the authorized party is not required to declare VAT on turnover from goods and service sale for which it is authorized to make invoices. Business establishments that authorize the making of invoices shall declare VAT on turnover from goods and service sale for which the making of invoices has been authorized to a third party.

10. Declaration of VAT for determination of payable VAT amounts by the presumption method complies with Article 19 of this Circular.

11. Declaration of VAT for ODA-funded projects, humanitarian aid entities and entities eligible for diplomatic immunities:

a/ Owners of projects funded with non­refundable ODA, offices of ODA-funded projects and Vietnam-based organizations using humanitarian aid that are eligible for VAT refund and entities eligible for diplomatic immunities are not required to make monthly VAT declaration.

b/ Owners of ODA-funded projects ineligible for VAT shall make monthly VAT returns according to form No. 01/GTGT provided in this Circular and send them to the tax agencies directly managing their projects.

c/ Foreign contractors implementing ODA-funded projects eligible for VAT refund shall make monthly VAT returns according to form No. 01/GTGT provided in this Circular and send them to the tax agencies of the localities in which the projects are implemented.

Article 11. Declaration of enterprise income tax (EIT)

1 Responsibility to submit EIT declaration dossiers to tax agencies:

a/ Taxpayers shall submit EIT declaration dossiers to tax agencies directly managing them;

b/ If taxpayers have independent cost-accounting subsidiaries, these subsidiaries shall submit dossiers of declaration of IT arising at these subsidiaries to tax agencies directly managing them;

c/ If taxpayers have dependent cost-accounting subsidiaries, these subsidiaries are not required to submit EIT declaration dossiers. When submitting EIT declaration dossiers, taxpayers shall make common declarations, covering also tax amounts arising at their subsidiaries, at their head offices;

d/ If taxpayers have dependent cost-accounting production establishments (including processing and assembly establishments) which are located in provinces or cities other than the localities in which taxpayers are headquartered, when submitting EIT declaration dossiers, taxpayers shall make common declarations for tax amounts arising at their head offices and their dependent cost-accounting production establishments;

e/ For economic groups and corporations that have dependent cost-accounting member units, if these member units can account their turnovers, expenditures and taxable incomes, they shall declare and pay EIT to their managing tax agencies.

f/ If member units conduct business operations different from common business lines of groups or corporations and can separately account incomes from these business operations, they shall declare EIT to their managing tax agencies.

When it is necessary to make tax declaration at variance with the guidance of this Point, economic groups and corporations shall report it to the Ministry of Finance for separate guidance.

2. EIT declaration means declaration of tax temporarily calculated on a quarterly basis, declaration for annual finalization or declaration for finalization up to the time of termination of business operations or contracts, transformation of enterprise ownership or enterprise reorganization. Tax declaration in some specific cases shall be made as follows:

- Declaration of EIT for each time of generation of income, applicable to real estate transfer activities;

- Declaration of EIT for each time of generation of income, applicable to foreign organizations conducting business in Vietnam or earning income in Vietnam (referred to as foreign contractors) that do not operate under the Investment Law or the Enterprise Law and earn income from capital transfer activities.

- Declaration of EIT calculated according to the proportion of income to goods and service sale turnovers, applicable to non-business units trading in goods or providing services which are liable to EIT and able to account turnovers but are unable to account and determine expenses and incomes from business operations (excluding cases of declaration of EIT temporarily calculated on a quarterly basis for taxpayers that declare tax according to the proportion of taxable income to turnover).

3. Declaration of EIT temporarily calculated on a quarterly basis:

Dossiers of declaration of EIT temporarily calculated on a quarterly basis are quarterly EIT returns, made according to form No. 01A/TNDN provided in this Circular.

If taxpayers are unable to declare expenses actually arising in the tax period, they shall use the quarterly EIT return form No. 01B/TNDN provided in this Circular. The basis for calculation of enterprise incomes in a quarter is the preceding year's proportion of taxable income to turnover.

If taxpayers have been examined or inspected by tax agencies and the proportion of taxable income to turnover according to the examination or inspection results is different from that declared by taxpayers, the tax agencies' examination or inspection results shall apply.

Enterprises may choose either of the 2 forms of declaration of EIT temporarily calculated on a quarterly basis for application throughout a tax year according to form No. 01A/TNDN or 01B/TNDN. Newly established enterprises or loss-making enterprises in the preceding year shall declare EIT temporarily calculated on a quarterly basis according to form No. 01A/ TNDN.

4. EIT finalization declaration:

a/ EIT finalization declaration includes declaration for annual finalization of EIT or declaration for finalization of EIT up to the time of termination of business operations, or contracts, transformation of enterprise ownership or reorganization.

b/ A dossier of EIT finalization declaration comprises:

-An EIT finalization return, made according to form 03/TNDN provided in this Circular;

- An annual financial statement or a financial statement up to the time of termination of business operations or contracts, transformation of enterprise ownership or reorganization;

- One or several annexes to the return (depending on the taxpayer's actually arising tax obligation):

+ Annex of production and business operation results, made according to forms No. 03-1A/TNDN, No. 03-1B/TNDN and No. 03-1C/TNDN provided in this Circular.

+ Annex of losses carried forward, made according to form No. 03-2/TNDN provided in this Circular.

+ Annexes of EIT income tax incentives:

* Form No. 03-3A/TNDN: EIT incentives for business establishments newly set up under investment projects and relocated business establishments.

* Form No. 03-3B/TNDN: EIT incentives for business establishments investing in new production chains, expanding production scope, renewing technologies to improve the ecological environment or increase production capacity.

* Form No. 03-3C/TNDN: EIT incentives for enterprises employing ethnic minority laborers and production, construction and transport enterprises employing a larger number of female laborers.

+ Annex of EIT amounts already paid abroad and creditable in the tax period, made according to form No. 03-4/TNDN provided in this Circular.

+ Annex of EIT on real estate transfer activities, made according to form No. 03-5/TNDN provided in this Circular.

+ Annex of EIT calculation and payment of enterprises having dependent cost-accounting production units in provinces or cities other than the localities in which the head offices are located (if any), made according to form No. 05/TNDN provided in this Circular.

+ Annex of associated transactions (if any), made according to form No. GCN-01/QLT provided in Appendix 1-GCN/CC to the Ministry of Finance's Circular No. 66/2010/TT-BTC of April 22, 2010, guiding the determination of market prices in business transactions among associated partners.

+ Annex of reporting on appropriation and use of the science and technology fund (if any), made according to the form promulgated together with the Ministry of Finance's Circular No. 15/2011/TT-BTC of February 9, 2011, guiding the setting up, organization, operation, management and use of enterprises' science and technology development funds.

5. Declaration of EIT on real estate transfer:

a/ Enterprises that transfer real estate in the provinces or cities in which they are headquartered shall declare tax at their managing tax agencies (provincial- or district-level Tax Departments). Enterprises that transfer real estate in provinces or cities other than the localities in which they are headquartered shall submit tax declaration dossiers to the provincial-level Tax Departments of the localities in which real estate is transferred or district-level Tax Departments designated by the directors of these provincial-level Tax Departments;

b/ Enterprises that transfer real estate on an irregular basis shall declare EIT temporarily calculated according to each transfer. Enterprises that transfer real estate on an irregular basis are those not engaged in real estate business.

In case real estate businesses transfer a whole investment project, they shall declare EIT temporarily calculated for each transfer.

A dossier of declaration of EIT for each transfer of real estate is the return of EIT on income from real estate transfer, made according to form No. 02/TNDN provided in this Circular.

When making EIT finalization declaration at the end of a tax year, taxpayers are required to make separate accounting for income tax for real estate transfer. In case the tax amount already paid under notices received when carrying out procedures for grant of land use right certificates is lower than the payable tax amount according to the EIT finalization return, enterprises shall pay the deficit tax amount into the state budget. In case the paid tax amount is higher than the payable tax amount according to the EIT finalization declaration, the overpaid tax amount shall be cleared against the EIT payable for other business operations or the payable EIT amount of the subsequent period. Enterprises that suffer from losses from real estate transfer activities shall separately monitor these losses and may account these losses as taxable incomes from real estate transfer activities of subsequent years according to regulations;

c/ Enterprises that transfer real estate on a regular basis shall declare EIT temporarily calculated on a quarterly basis. Enterprises that transfer real estate on a regular basis are those engaged in real estate business.

A dossier of quarterly declaration of temporarily calculated EIT is the return of EIT on income from real estate transfer, made according to form No. 02/TNDN. In case enterprises have signed many real estate transfer contracts in a month, they may enclose a list thereof.

If enterprises engaged in real estate transfer on a regular basis request for permission to declare tax on each transfer, they shall declare tax like enterprises engaged in real estate transfer on an irregular basis and are not required to make quarterly declaration of temporarily calculated tax.

At the end of the tax year, enterprises shall carry out procedures for finalization of EIT for all real estate transfer activities which have been declared in the returns of EIT temporarily paid on a quarterly basis or upon each transfer of real estate. In case the paid tax amount in the year is lower than the payable tax amount according to the EIT finalization return, enterprises shall pay the deficit amount into the state budget. In case the temporarily paid tax amount is higher than the payable tax amount according to EIT finalization return, the overpaid tax amount may be cleared against the payable EIT of the subsequent period. In case losses are incurred in real estate transfer activities, enterprises shall separately monitor such losses and may account these losses into taxable income from real estate transfer activities of subsequent years according to regulations;

d/ Enterprises which are allocated or leased land by the State for the implementation of investment projects on building infrastructure or houses for transfer or lease with the collection of advances from customers based on the construction progress in any form:

- In case enterprises have collected advances from customers and can determine expenses corresponding to turnover, they shall, after subtracting expenses, temporarily declare and pay EIT according to turnover.

- In case enterprises have collected advances from customers but cannot determine expenses corresponding to turnover, they shall temporarily declare and pay EIT at the rate of 2% of turnover but are not required to calculate this turnover as taxable turnover in the year.

EIT temporarily calculated for money amounts collected in advance from customers based on the construction progress shall be declared in Part II of the return made according to form No. 02/TNDN provided in this Circular. When handing over real estate, enterprises shall make official finalization of EIT on income from real estate transfer activities in Part I of the return, made according to form No. 02/TNDN. In case enterprises sign in a quarter several real estate transfer contracts (including those under which money are collected in advance from customers based on the construction schedule), they may make and enclose a list of these contracts.

Real estate businesses shall declare EIT on income from money collected in advance from customers based on the construction progress in any forms while making declaration of EIT temporarily calculated on a quarterly basis for income from real estate transfer.

6. Declaration of EIT calculated based the proportion (%) of income to goods and service sale turnover (excluding case of making declaration of EIT temporarily calculated on a quarterly basis, applicable to taxpayers that declare tax based on the proportion of taxable income to turnover) applies to non-business units that trade in goods or services subject to EIT, provided that these units can account turnover but cannot account and determine expenses for and incomes from these business operations.

Non-business units shall declare EIT calculated based on the proportion (%) of income to taxable turnover in the EIT return form No. 04/TNDN provided in this Circular.

Non-business units that regularly trade in goods or services subject to EIT may make monthly tax declaration and are not required to make annual tax finalization.

Non-business units that irregularly trade in goods or services subject to EIT shall declare EIT for each time of generation of taxable income.

7. In case an enterprise has dependent cost-accounting production establishments (including processing and assembly establishments) in provinces or cities other than the locality in which it is headquartered, when submitting EIT declaration dossiers, the enterprise shall make tax declaration for both incomes generated in the locality in which it is headquartered and incomes earned in localities in which its dependent cost-accounting production establishments are located at its head office.

The EIT amounts to be calculated and paid to provinces and cities in which dependent cost-accounting production establishments are located shall be determined as being equal to the payable EIT amount in the period multiplied (x) by the proportion of expenses of dependent cost-accounting production establishments to the total expenses of the enterprise.

Enterprises' head offices shall declare and pay EIT on incomes generated at head offices and dependent cost-accounting production establishments. They shall make tax returns according to form No. 05/TNDN provided in this Circular (including quarterly declaration of temporarily calculated EIT and annual EIT finalization declaration) and submit them to tax agencies directly managing them and, at the same time, send a copy of each tax return to tax agencies managing dependent cost-accounting production establishments.

a/ Procedures for transfer of documents between state treasuries and tax agencies

An enterprise shall base itself on EIT amounts calculated and paid at its head office and dependent cost-accounting production establishments declared in form No. 05/TNDN to make documents on payment of EIT to the locality in which it is headquartered and localities in which dependent cost-accounting production establishments are located. The tax payment documents must clearly state that tax is paid into the state budget revenue account at the State Treasury of the same level with the tax agency with which the head office has made tax declaration and payment registration and tax agencies of localities in which dependent cost-accounting production establishments are located. The State Treasury of the locality in which it is headquartered shall transfer money and documents on collection of state budget revenues to relevant state treasuries for the latter to account tax amounts paid for dependent cost-accounting production establishments as state budget revenues.

b/ Tax finalization

An enterprise shall declare EIT finalization at its head office. The payable EIT amount shall be determined as being equal to the payable EIT amount under the finalization minus (-) the EIT amount temporarily paid at the head office and subsidiary production establishments. The payable or refundable EIT amount upon tax finalization shall also be allocated according to the set proportion between the locality in which the enterprise is headquartered and localities in which their subsidiary production establishments are located.

8. Declaration of EIT for each generation of taxable income shall apply to foreign organizations doing business or earning incomes in Vietnam (collectively referred to as foreign contractors) but not operating under the Investment Law or the Enterprise Law and conducting capital transfer activities.

Capital transferees shall determine, declare, withhold and pay EIT on behalf of foreign organizations. In case capital transferees are also foreign organizations not operating under the Investment Law or the Enterprise Law, enterprises set up under Vietnamese law in which foreign organizations invest capital shall declare and pay the payable EIT for foreign organizations' capital transfer activities.

Tax declaration dossiers shall be submitted within 10 days after competent agencies approve the capital transfer or after involved parties agree on the capital transfer in the capital transfer contracts, for cases in which the capital transfer is not subject to approval.

A dossier of declaration of EIT on income from capital transfer comprises:

- A return of EIT on income from capital transfer (made according to form No. 06/TNDN provided in this Circular);

- A copy of the transfer contract. In case the contract is made in a foreign language, the following principal contents must be translated into Vietnamese: the transferor; the transferee; transfer time; transfer contents; rights and obligations of each party; contractual value; time, mode and currency used for payment.

- A copy of the decision approving the capital transfer, issued by a competent agency (if any);

- A copy of the capital contribution certificate;

- Original invoices of expenses.

When necessary to supplement a dossier, the tax agency shall immediately notify the transferee right on the date of receiving the dossier, for cases in which the dossier is directly submitted; or within 3 working days after receiving the dossier, for cases in which the dossier is sent by post or electronically.

Places of submission of tax finalization dossiers: tax agencies with which foreign capital transferors have made tax payment registration.

Article 12. Declaration of excise tax

1. Responsibility to submit excise tax declaration dossiers to tax agencies:

a/ Taxpayers that produce or process goods or provide services liable to excise tax; are engaged in export business and purchase goods for which excise tax has not been paid, and then do not export but sell these goods at home shall submit excise tax declaration dossiers to their managing tax agencies.

b/ If taxpayers producing goods liable to excise tax sell goods through their branches, stores, subsidiaries or sale agents that sell goods at set prices for commissions, or consign goods for sale, they shall declare excise tax on the whole quantity of these goods with their managing tax agencies. Branches, stores, subsidiaries, agents or units selling consigned goods are not required to declare excise tax but shall send lists of goods sold to both taxpayers and tax agencies directly managing branches, stores, subsidiaries, agents or units selling consigned goods for monitoring.

c/ If taxpayers have subsidiaries producing goods liable to excise tax which are located in provinces or cities other than the localities in which the taxpayers are headquartered, they shall declare excise tax with tax agencies directly managing production establishments.

2. Declaration of excise tax is made on a monthly basis. For goods purchased for export but sold at home, declaration must be made for each time of arising a tax obligation.

3. An excise tax declaration dossier comprises:

- An excise tax return, made according to form No. 01/TTDB provided in this Circular;

- A list of invoices of goods and services liable to excise tax, made according to form No. 01-1/TTDB provided in this Circular;

- A list of creditable excise tax amounts (if any), made according to form No. 01-2/TTDB provided in this Circular;

4. Declaration of excise tax for determining payable excise tax amounts by the presumption method complies with Article 19 of this Circular.

Article 13. Declaration of royalty

1. Responsibility to submit royalty declaration dossiers to tax agencies:

Taxpayers shall submit their royalty declaration dossiers to tax agencies directly managing them.

a/ Establishments exploiting natural resources (excluding those exploiting water for hydropower generation):

Units that exploit crude oil, natural gas, coal gas; or exploit natural resources in mines located in different districts within a province shall submit royalty declaration dossiers to provincial-level Tax Departments of the localities in which they exploit natural resources.

b/ In case establishments that purchase natural resources register to pay royalty on behalf of organizations or individuals exploiting natural resources on a small scale, they shall submit royalty declaration dossiers to their managing tax agencies.

2. Declaration of royalty (excluding royalty for crude oil) includes monthly declaration and declaration for annual finalization or declaration for finalization up to the time of termination of natural resources exploitation or business operations or contracts, transformation of enterprise or enterprise reorganization.

3. Royalty declaration dossiers (except for crude oil and natural gas):

a/ A dossier of monthly royalty declaration comprises:

A royalty return, made according to form No. 01/TAIN provided in this Circular.

b/ A dossier of royalty finalization declaration comprises:

- A royalty finalization return, made according to form No. 03/TAIN provided in this Circular.

- Enclosed documents related to royalty exemption or reduction (if any).

4. Declaration of royalty on crude oil and natural gas;

a/ Declaration of temporarily calculated royalty:

a.1/ For crude oil:

- A royalty declaration dossier is the temporarily calculated royalty return, made according to form No. 01/TAIN-DK provided in this Circular.

- The dossier of declaration of temporarily calculated royalty shall be submitted within 35 days after the date of selling crude oil (for crude oil sold on the domestic market) or the date the customs offices certify the export of crude oil.

a.2/ For natural gas:

- A royalty declaration dossier is the temporarily calculated royalty return, made according to form No. 01/TAIN-DK provided in this Circular.

- The deadline for submission of the dossier of declaration of temporarily calculated royalty is the 20th every month.

b/ Dossiers of royalty finalization for crude oil and natural gas:

- A royalty finalization return, made according to form No. 02/TAIN-DK provided in this Circular.

- A list of output and turnover from sale of crude oil or natural gas exploited in the royalty period, made according to form No. 02-1/TAIN-DK provided in this Circular.

- A list of temporarily calculated royalty amounts in the royalty period, made according to form No. 02-2/TAIN-DK provided in this Circular.

c/ The time limit for submission of dossiers of royalty finalization declaration for crude oil or natural gas:

- Within 90 days after the last day of a calendar year.

- Within 45 days after the termination of a petroleum contract.

5. Declaration of royalty for determining payable royalty amounts by the presumption method complies with Article 19 of this Circular.

Article 14. Declaration of personal income tax (PIT)

1. Organizations and individuals that pay incomes liable to PIT and individuals that have income liable to PIT shall make tax declaration and finalization under regulations.

2. Organizations and individuals that pay incomes subject to tax withholding, regardless of whether tax have been withheld or not, shall make PIT finalization declaration and effect PIT finalization for individuals that authorize them to do so.

3. Resident individuals earning incomes from salary, wage and business operations shall make tax finalization declaration in the following cases:

a/ The payable tax amount is larger than the withheld or temporarily paid tax amount or tax obligation has arisen in the year but not yet withheld or temporarily paid.

b/ They request tax refund or clearing of the overpaid tax amount against the payable tax amount of the subsequent period.

4. Tax declaration by tax-withholding income payers

a/ Monthly and quarterly tax declaration

Organizations and individuals paying incomes liable to PIT and withholding tax shall declare and submit monthly or quarterly tax returns to tax agencies. Specifically:

a.1/ For cases of withholding PIT on incomes from salary or wage: To submit a return, made according to form No. 02/KK-TNCN provided in this Circular.

a.2/ For cases of withholding PIT on incomes from capital investment, securities transfer, copyright royalty, commercial franchise or prize winning to individuals and paying incomes from business operations to non-resident individuals: To submit a return, made according to form No. 03/KK-TNCN provided in this Circular.

a.3/ For cases in which insurance principals withhold PIT on incomes of insurance agents: To submit a return, made according to form No. 01/KK-BH provided in this Circular.

a.4/ For cases in which lottery business organizations withhold PIT on incomes of lottery agents: To submit a return, made according to form No. 01/KK-XS provided in this Circular.

b/ The method of determining monthly or quarterly declaration shall be applied throughout a tax year. Specifically as follows:

b.1/ A taxpayer who has the total to-be-withheld tax amount according to all kinds of tax returns arising in the first month of the year is VND 5 million or more may submit tax returns on a monthly basis. If the to-be-withheld tax amount is under VND 5 million, the taxpayer may submit tax returns on a quarterly basis for the whole year.

b.2/ An income payer who has no tax amount to be withheld in a month or quarter is not required to submit tax returns to tax agencies.

Example:

- In case an income payer has no tax amount to be withheld in January and February. In March, it has a to-be-withheld tax amount of VND 5 million or higher, it shall submit tax returns as follows:

In January and February, it is not required to declare tax.

From March on, it shall declare tax on a monthly basis.

- In case a tax payer has no tax amount to be withheld from January till April. In May, it has a to-be-withheld tax amount of under VND 5 million, it shall submit tax returns as follows:

From January till April, it is not required to declare tax.

From May on, it shall declare tax on a monthly basis, starting from the second quarter.

c/ Tax finalization declaration:

c.1/ A tax finalization declaration dossier to be submitted by organizations or individuals paying incomes from salary or wage comprises:

- A PIT finalization return (made according to form No. 05/KK-TNCN provided in this Circular);

- A list of PIT-liable incomes and PIT on incomes from salary and wage of resident individuals having signed labor contracts (made according to form No. 05A/BK.-TNCN provided in this Circular);

- A list of PIT-liable incomes and PIT on incomes from salary and wage of individuals who have not yet signed labor contracts or have signed labor contracts of a term of less than 3 months or non-resident individuals (made according to form No. 05B/BK-TNCN provided in this Circular).

c.2/ When making tax finalization, if there is any request for PIT refund, income payers shall submit tax refund dossiers as prescribed in Article 46 of this Circular.

c.3/ A tax finalization declaration dossier to be submitted by organizations or individuals that pay incomes from capital investment, securities transfer, copyright royalty, commercial franchise and prize winning and incomes from business operations to non-resident individuals comprises:

- A PIT finalization return (made according to form No. 06/KK-TNCN provided in this Circular);

- A list of transfer value and PIT amounts already withheld for incomes from securities transfer (made according to form No. 06/BK-TNCN provided in this Circular).

c.4/ Insurance principals shall declare and finalize the PIT amounts already withheld for insurance agents according to form No. 02/KK-BK and make a list thereof according to form No. 02/BK-BH provided in this Circular.

c.5/ Lottery business organizations shall declare and finalize the PIT amounts already withheld for lottery agents according to form No. 02/KK-XS and make a list thereof according to form No. 02/BK-XS provided in this Circular.

d/ Places of submission of tax declaration dossiers are specified as follows:

d. 1/ Income payers being production or business organizations and individuals shall submit tax declaration dossiers at their managing tax agencies.

d.2/ For other cases:

d.2.1/ Central agencies, agencies attached to or under ministries, branches, provincial-level People's Committees and provincial-level agencies shall submit tax declaration dossiers at provincial-level Tax Departments of the localities in which they are headquartered.

d.2.2/Agencies attached to or under district-level People's Committees and district-level agencies shall submit tax declaration dossiers to district-level Tax Departments of the localities in which they are headquartered.

d.2.3/ Diplomatic agencies, international organizations and representative offices of foreign organizations shall submit tax declaration dossiers to provincial-level Tax Departments of the localities in which they are headquartered.

5. Declaration of PIT by resident individuals or groups of resident individuals earning incomes from business operations.

a/ Declaration of PIT by business individuals and groups of business individuals paying tax according to registration

a.1/ Quarterly declaration of temporarily paid PIT:

a.1.1/ Tax declaration dossiers:

+ Business individuals shall declare tax according to form No. 08/KK-TNCN provided in this Circular.

+ Groups of business individuals shall declare tax according to form No. 08A/KK-TNCN provided in this Circular.

a.1.2/ Bases for determining the temporarily paid PIT amounts:

+ Temporarily calculated taxable income in a quarter is determined as being equal to turnover earned in the quarter minus temporarily calculated expenses in the quarter:

Turnover earned in a quarter is determined as being equal to goods and service sale turnover declared in the quarter

Temporarily calculated expenses in a quarter are arising expenses related to turnover earned in the quarter.

+ Temporarily calculated taxable income is determined as being equal to taxable income minus family circumstance-based reductions for the whole quarter.

+ The PIT amount to be temporarily paid on the quarterly basis shall be determined according to the following formula:

Tax amount to be temporarily paid on a quarterly basis	=	Temporarily determined taxable income in the quarter	x	Tax rate according to the partially progressive tariff applicable to monthly income	x	3
		3

Individuals and groups of individuals having houses or grounds for lease that have been granted tax identification numbers shall declare and temporarily pay PIT on a quarterly basis according to form No. 08/KK-TNCN provided in this Circular. In case individuals or groups of individuals lease their houses or grounds in the form under which lessees pay in advance the rent for a definite period, they shall declare PIT on the rent amount received in advance.

For a group of business individuals, the temporarily paid PIT amount shall be calculated for each individual on the basis of his/her temporarily distributed income, family circumstances and tax rates. On the basis of the PIT amount temporarily calculated for each individual, the representative of the group shall pay tax into the state budget according to the document on remittance of money into the state budget made for each member.

a.2/ Tax finalization declaration: Tax finalization declaration dossiers. + For business individuals, tax finalization returns shall be made according to form No. 09/KK-TNCN. Annexes shall be made according to forms No. 09B/PL-TNCN and No. 09C/PL-TNCN provided in this Circular. Dossiers must comprise copies of papers evidencing tax amounts temporarily paid in the year. Individuals shall sign these copies to commit mat they shall take responsibility therefor.

Individuals joining a business group shall also submit the tax finalization return of the business group, made according to form No. 08B/KK-TNCN provided in this Circular.

Business individuals shall submit tax finalization dossiers to the district-level Tax Departments directly managing them.

An individual doing business in different localities and having 13-digit tax identification numbers (doing business in different provinces or different districts of a province) shall submit tax finalization dossiers to the tax agency managing his/her head office which has a 10-digit tax identification number.

+ For groups of business individuals, the representative of a business group shall make a tax finalization declaration dossier according to form No. 08B/KK-TNCN provided in this Circular to determine the total taxable income of the group and taxable income of each of its members.

Each member of the business group may receive an original of the group's tax finalization return for him/her to conduct tax finalization.

Groups of business individuals shall submit tax finalization declaration dossiers to district-level Tax Departments of the localities in which they conduct business operations.

b/ Business individuals and groups of business individuals that can account business turnover but cannot account expenses shall make tax declaration under Point a, Clause 5 of this Article. Particularly taxable incomes shall be determined at the level assessed by tax agencies.

c/ Tax declaration by business individuals and groups of business individuals paying tax by the presumption method.

c.1/ Tax declaration dossiers:

c.1.1/ Business individuals shall make tax returns according to form No. 10/KK-TNCN provided in this Circular.

c.1.2/ Groups of business individuals shall make tax returns according form No. 10A/KK-TNCN provided in this Circular.

c.2/ Tax declaration dossiers shall be submitted to district-level Tax Departments of the localities in which business individuals or groups of business individuals conduct business operations.

c.3/ Tax agencies shall make notices of annual payable tax amounts and tax amounts temporarily paid on a quarterly basis of business individuals or groups of business individuals according to form No. 10- 1/TB-TNCN provided m this Circular no later than the last day of February.

c.4/ Individuals earning incomes only from business operations and paying PIT by the presumption method are not required to make tax finalization.

6. Tax declaration by individuals earning income from salary and wage and non-resident individuals earning incomes from business operations

a/ Monthly tax declaration:

a.1/ Cases subject to monthly tax declaration:

a.1.1/ Individuals earning incomes from salary and wage paid by overseas organizations and individuals.

a.1.2/ Individuals earning incomes from salary and wage paid by international organizations, foreign embassies and consulates in Vietnam for which tax has not yet been withheld.

a.1.3/ Non-resident individuals earning incomes from business operations.

In case income payers have withheld and paid tax on behalf of individuals, such individuals are not required to declare and pay tax on a monthly basis.

a.2/ Monthly tax declaration dossiers are PIT returns made according to form No. 07/KK-TNCN provided in this Circular.

a.3/ Places of submission of monthly tax declaration dossiers

a.3.1/ For incomes from salary and wage, dossiers shall be submitted to provincial-level Tax Departments of the localities in which individuals are working.

a.3.2/ For incomes from business operations, dossiers shall be submitted to provincial-level Tax Departments of the localities in which individuals conduct business operations.

b/ Tax finalization declaration:

b.1/ Resident individuals earning incomes from salary and wage shall make tax finalization declaration.

Resident foreigners who no longer work in Vietnam shall complete tax finalization with tax agencies before their exit.

In case an individual earning incomes from salary and wage paid by a single income payer throughout a calendar year, he/she may authorize the income payer to make tax finalization for him/her. Authorization papers shall be made according to form No. 04-2/TNCN provided in this Circular.

Individuals who have received tax withholding documents from income payers may not authorize income payers to make tax finalization (except cases in which income payers have revoked and destroyed tax withholding documents already issued to individuals).

b/ A tax finalization declaration dossier comprises:

- A tax finalization return, made according to form No. 09/KK-TNCN, and annexes, made according to forms No. 09A/PL-TNCN and No. 09C/PL-TNCN (in case of registering for family circumstance-based reduction), provided in this Circular.

- Copies of documents evidencing tax amounts already withheld or temporarily paid in the year. Individuals shall sign these documents to commit that they shall take responsibility therefor.

- For individuals who receive incomes from international organizations, embassies or consulates or receive incomes from foreign countries, documents evidencing or certifying of the paid tax amounts issued by overseas income payers, provided in a written certification of annual income made according to form No. 20/TXN-TNCN provided in this Circular, are required.

b.3/ Places of submission of tax finalization dossiers

b.3.1/ Individuals earning incomes from salary and wage from a single source shall submit tax finalization dossiers to the tax agency managing the income payer.

b.3.2/ For individuals earning incomes from salary and wage from two or more sources:

+ In case an individual has made reduction for him/herself at an income payer, he/she shall submit the tax finalization dossier to the tax agency managing such income payer.

+ In case an individual has not yet made reduction for him/herself at any income payer, he/she shall submit the tax finalization dossier to the tax agency of the locality in which he/she resides.

b.3.3/ Individuals earning incomes from salary and wage and directly declaring tax on a monthly basis shall submit tax finalization dossiers to provincial-level Tax Departments to which they submit monthly lax declaration dossiers.

Example: Mr. A is the head of a foreign company's representative office in Vietnam and receives incomes from overseas. From January 1, 2010, to September 15, 2010, he worked in Hanoi and made monthly tax declaration with the Tax Department of Hanoi city. From October 1, 2010, he moved to work in Binh Duong province and made monthly tax declaration to the Tax Department of Binh Duong province. In this case, Mr. A shall submit his 2010 tax finalization dossier to the Tax Department of Binh Duong province.

7. Tax declaration by resident individuals earning incomes from both business operations and salary and wage

a/ Declaration of temporarily paid tax: Individuals earning incomes from both business operations and salary and wage shall declare and temporarily pay PIT for income from business operations under the guidance in Clause 5 of this Article.

b/ Tax finalization declaration

b.1/ A tax finalization dossier comprises:

b.1.1/ A tax finalization return, made according to form No. 09/KK-TNCN, and annexes, made according to forms No. 09A/PL-TNCN; No. 09B/PL-TNCN and No. 09C/PL-TNCN provided in this Circular.

b.1.2/ Copies of documents evidencing tax amounts already withheld or temporarily paid in the year. The taxpayer shall sign these copies to commit that they shall take responsibility therefor.

b.2/ Tax finalization dossiers shall be submitted to district-level Tax Departments of the localities in which individuals conduct business operations. Individuals who conduct business operations in many localities shall submit tax finalization dossiers to the district-level Tax Department managing their head offices which have 10-digit lax identification numbers.

8. Tax declaration for incomes from real estate transfer

Individuals earning incomes from real estate transfer, regardless of whether they are liable to tax or not. shall make PIT declaration dossiers for submission together with dossiers of transfer of real estate ownership or use rights.

a/ A tax declaration dossier comprises:

- A PIT declaration return applicable to individuals transferring real estate, made according to form No. 11/KK-TNCN provided in this Circular.

- Copies of certificates of the right to use land or to own houses or other assets attached to land. Individuals shall sign these copies to commit that they shall take responsibility therefor.

- The real estate transfer contract.

- Individuals who request application of the tax rate of 25% of incomes from real estate transfer shall submit copies of valid documents to serve as proof of relevant expenses according to regulations.

- For cases of real estate transfer which are eligible for PIT exemption, there must be papers evidencing the eligibility for tax exemption according to regulations.

b/ Places of submission of tax declaration dossiers: Individuals shall submit tax declaration dossiers together with real estate transfer dossiers at the one-stop-shop section. In localities which have not yet applied the one-stop-shop mechanism, dossiers shall be submitted directly to the land use right registration offices of the locality where exists the transferred real estate.

c/ Tax payment time limit: Within 30 days after taxpayers receive a tax notice, made according to form No. 11 - 1/TB-TNCN provided in this Circular.

9. Tax declaration for incomes from capital transfer

Individuals earning incomes from capital transfer (except incomes from securities transfer) shall declare tax and submit tax returns to tax agencies as follows:

a/ A tax declaration dossier comprises:

- A PIT return, applicable to individuals earning incomes from capital transfer, made according to form No. 12/KK-TNCN provided in this Circular.

- Copies of capital transfer contracts.

- Copies of documents evidencing expenses related to the determination of incomes from capital transfer. Individuals shall sign these copies to commit that they shall take responsibility therefor.

b/ Places of submission of tax declaration dossiers: Tax agencies managing business establishments involved in the capital transfer.

c/ Tax payment time limit: Within 30 days after receiving a tax notice, made according to form No. 12-1/TB-TNCN provided in this Circular.

10. Tax declaration by individuals earning incomes from securities transfer

a/ An individual engaged in securities transfer who has made registration for payment of PIT according to the whole income tariff at the tax rate of 20% on earned incomes according to form No. 15/DK-TNCN provided in this Circular shall make tax finalization in the following cases:

- The payable tax amount calculated at the tax rate of 20% is higher than the temporarily withheld tax amount calculated at the tax rate of 0.1% in the year.

- The taxpayer requests tax refund or clearing of the overpaid tax amount against the payable tax amount of the subsequent year.

b/ A tax finalization dossier comprises:

- A tax finalization return, made according to form No. 13/KK-TNCN provided in this Circular.

- A detailed list of securities transferred in the year, made according to form No. 13/BK-TNCN provided in this Circular.

- Copies of invoices and documents evidencing other expenses related to securities transfer. Individuals shall sign these copies to commit that they shall take responsibility therefor.

- Copies of documents evidencing tax amounts withheld in the year. Individuals shall sign these copies to commit that they shall take responsibility therefor.

c/ Tax finalization dossiers shall be submitted to tax agencies managing securities companies with which taxpayers registered their transactions by the time of finalization.

11. Tax declaration for incomes from inheritance or gifts

Individuals earning incomes from inheritance or gifts shall declare tax upon each time of earning incomes from inheritance or gifts. Particularly for inheritance or gift being real estate, tax declaration shall be made under Clause 5 of this Article.

a/ A tax declaration dossier comprises:

-A PIT return on incomes from inheritance or gifts, made according to form No. 14/KK-TNCN provided in this Circular.

.- Copies of legal papers evidencing the right to receive inheritance or gifts. Taxpayers shall sign these copies to commit that they shall take responsibility therefor.

b/ Places of submission of tax declaration dossiers: District-level Tax Departments of the localities in which inheritance or gift recipients reside.

c/ Tax payment time limit: Within 30 days after receiving a tax notice, made according to form No. 14-1/TB-TNCN provided in this Circular.

12. Tax declaration by resident individuals earning incomes overseas

a/ A tax declaration dossier comprises:

+ A tax return, made according to form No. 19/KK-TNCN provided in this Circular for taxable incomes earned overseas from capital transfer, copyright royalty, commercial franchise or prize winning;

+ A tax return, made according to relevant forms applicable to incomes earned in Vietnam from real estate or securities transfer and receipt of inheritance or gifts.

In addition to the above the return, the taxpayer shall enclose documents on payment of incomes and documents evidencing overseas tax payment to serve as a basis for the determination of incomes and PIT amounts already paid overseas.

b/ The time limit for tax declaration is 10 days after the date of generating or receiving incomes. If the income earner is staying overseas by the time of generating or receiving incomes, the time limit for tax declaration is 10 days after he/she returns to Vietnam.

c/ The place of submission of tax declaration dossiers is provincial-level Tax Departments of the localities in which individuals reside.

13. Tax declaration in case of receiving dividends in stocks, bonus stocks or an increase in contributed capital:

Upon receiving dividends in stocks, bonus stocks or an increase in contributed capital, individuals are not yet required to pay PIT. When transferring such stocks or contributed capital, they shall pay PIT for incomes from securities transfer or capital investment.

- A tax declaration dossier comprises:

A tax return, made according to form No. 24/KK-TNCN provided in this Circular.

b/ Places of submission of dossiers: Tax agencies directly managing business establishments involved in the capital transfer.

c/ Tax payment time limit: The time when individuals transfer shares, bonus shares or increased capital portions.

14. In case foreigners earning taxable incomes are eligible for tax exemption or reduction under double taxation avoidance agreements between Vietnam and other countries or territories, the following procedures apply:

a/ For individuals being residents of foreign countries:

Fifteen days before performing contracts with Vietnamese organizations or individuals, foreigners shall send dossiers of notification of eligibility for tax exemption or reduction under agreements to Vietnamese contracting or income-paying parties. A dossier comprises:

- A notice of eligibility for tax exemption or reduction under an agreement, made according to form No. 01/HTQT provided in this Circular;

A foreigner who, in force majeure circumstances, is unable to provide sufficient information or documents as required for such notice should give detailed explanation therefor.

- The original certificate of residence granted by a tax agency of the country of residence in the year preceding the year of notification of eligibility for tax exemption or reduction under the agreement, which has been consularly legalized;

- A copy of the labor contract with the overseas employer (if any). Individuals shall sign this copy to commit that they shall take responsibility therefor;

- A copy of the labor contract with the Vietnam-based employer. Individuals shall sign this copy to commit that they shall take responsibility therefor;

- A copy of the passport used for entry into or exit from Vietnam. Individuals shall sign this copy to commit that they shall take responsibility therefor.

If taxpayers have notified their eligibility for tax exemption or reduction under agreement in the previous year, in subsequent year, they are required to submit only copies of labor contracts newly signed with organizations or individuals in Vietnam or foreign countries (if any).

Fifteen days before the expiration of the contract for working in Vietnam or the end of the tax year, whichever is earlier, an individual shall send a certificate of residence of that tax year and a copy of his/her passport to the Vietnamese contracting or income-paying party.

A foreigner who cannot obtain a certificate of residence by that time is obliged to commit to send this certificate in the first quarter of the following year.

A person who is a resident of a Country or territory which has signed a double taxation avoidance agreement with Vietnam but does not grant certificates of residence shall provide a copy of his/her passport in replacement of the certificate of residence.

In case of impossibility to determine the country or territory of which a person is a resident by the time of submission of a copy of his/her passport, such person shall commit to sending a copy of his/her passport within the first quarter of the subsequent year.

b/ For foreigners being residents of Vietnam:

For foreigners being residents of Vietnam who are entitled to tax exemption or reduction for incomes provided in regulations on incomes from governmental services, incomes of students job trainees, teachers, professors and researchers, the following procedures apply:

Fifteen days before performing contracts with Vietnamese organizations or individuals, foreigners shall send dossiers of notification of eligibility for tax exemption or reduction to Vietnamese contracting or income-paying parties. A dossier comprises:

- A notice of eligibility for tax exemption or reduction under an agreement, made according to form No. 01/HTQT provided in this Circular;

A foreigner who, in force majeure circumstances, is unable to provide sufficient information or documents as required for such notice shall give detailed explanation therefor.

- The original certificate of residence granted by a tax agency of the country of residence in the year preceding the year of notification of eligibility for tax exemption or reduction under the agreement, which has been consularly legalized;

- A certificate granted by the agency representing Vietnam in income-generating operations stated in the notice on tax exemption under the agreement.

A person who is a resident of a country and territory which has signed a double taxation avoidance agreement with Vietnam but does not grant certificates of residence shall supply a copy of his/her passport in replacement of the certificate of residence and commit to take responsibility for the non-grant of certificates of residence as stated in the notice of eligibility for tax exemption or reduction under agreement.

In case of impossibility to identify the country or territory of which a person is a resident by the time of submission of a copy of his/her passport, such person shall commit to sending a copy of his/her passport within the first quarter of the subsequent year.

c/ For athletes and artists being residents of foreign countries and earning incomes from cultural performance, sports or physical training activities in Vietnam:

Fifteen days before performing contracts (or cultural or sport or physical training exchange programs) with Vietnamese organizations or individuals, foreigners shall send to Vietnamese contracting or income-paying parties dossiers of notification of eligibility for tax exemption or reduction under agreements. A dossier comprises:

- A notice of eligibility for tax exemption or reduction under an agreement, made according to form No. 01/HTQT provided in this Circular;

A foreigner who, in force majeure circumstances, is unable to provide sufficient information or documents as required for such notice shall give detailed explanation therefor.

- The original certificate of residence granted by a tax agency of the country of residence in the year preceding the year of notification of eligibility for tax exemption or reduction under the agreement, which has been consularly legalized;

- A certificate granted by the agency representing Vietnam in the cultural or sport or physical training exchange program of activities and incomes stated in the notice of tax exemption under the agreement.

Fifteen days before the expiration of the contract for working in Vietnam (or the cultural or sport or physical training exchange program) or the end of the tax year, whichever is earlier, a foreigner shall send a certificate of residence of that tax year to the Vietnamese contracting or income-paying party.

A foreigner who cannot obtain a certificate of residence by that time shall commit to sending this certificate in the first quarter of the following year.

A taxpayer who has not yet signed labor contracts with overseas or Vietnam-based employers may submit to tax agencies an appointment letter or papers which are equivalent to or as valid as labor contracts.

A foreigner who is a resident of a country or territory which has signed a tax agreement with Vietnam but does grant certificates of residence shall provide a copy of his/her passport in replacement of the certificate of residence and commit to take responsibility for the non-grant of certificates of residence as stated in the notice of eligibility for tax exemption or reduction under an agreement.

In case of impossibility to identify the country or territory of which an individual is a resident by the time of submission of a copy of his/her passport, such individual shall commit to sending a copy of his/her passport within the first quarter of the subsequent year.

15. In case individuals who register their dependents for family circumstance-based reductions; income payers who request for the issuance of PIT withholding documents; individuals who declare persons they directly nurture. disabled people without working capacity and individuals without labor contracts of a term of 3 months or more commit that their taxable incomes are lower than the tax threshold, they shall comply with regulations and make declaration according to forms No. 16/DK-TNCN. No. 17/TNCN, 21a/XN-TNCN, 21b/XN-TNCN, 22/XN-TNCN and 23/CK-TNCN, provided in this Circular.

Article 15. Declaration of license tax

1. License tax payers shall submit license tax returns to tax agencies directly managing them.

A taxpayer that has subsidiaries (branches, stores, etc.) conducting business in the same province or city shall submit license tax returns of these subsidiaries to the tax agency directly managing it.

In case a taxpayer has subsidiaries located in provinces or cities other than the locality in which it is headquartered, these subsidiaries shall submit their license tax returns to their managing tax agencies.

A taxpayer that conducts business operations without a fixed place of business, such as shipment goods trading or mobile business and a household engaged in construction, transportation or other self-employed operations submit its license tax declaration dossier to the district-level Tax Department managing the locality in which it conducts business operations or resides.

2. License lax is declared and paid on a yearly basis as follows:

- When a taxpayer commences its production or business operations, it shall make one-time license tax declaration no later than the last day of the month of commencement of production or business operations.

In case a taxpayer has established a new business establishment but not yet commenced production or business operations, it shall make license lax declaration within 30 days after being granted a business registration certificate and tax registration certificate or an enterprise registration certificate.

A taxpayer currently conducting business operations that has declared and paid license tax is not required to submit license tax registration dossiers for subsequent years if there is no change in elements which affect the payable license tax amount in these years.

- If there is any change in elements related to tax bases which leads to a change in the payable license tax amount of the subsequent year, the taxpayer is required to submit a license tax declaration dossier for the subsequent year no later than December 31 of the year when such change occurs.

3. A license tax declaration dossier is a license tax return made according to form No. 01/MBAI provided in this Circular.

Article 16. Declaration of taxes and state budget revenues related to land use

1. Declaration of house and land tax and determination of payable tax amounts:

a/ Taxpayers shall make a house and land tax declaration dossier for each land plot and submit it to the district-level Tax Department of the locality where exists the land plot liable to house and land tax.

b/ Deadlines for submission of house and land tax declaration dossiers:

- For organizations, the deadline for submission of housing and land tax declaration dossiers is January 30 every year.

- Land-using households and individuals that have made house and land tax declaration are not required to submit house and land tax declaration dossiers for the subsequent year.

- A taxpayer whose land area liable to house and land tax increases or decreases in a year shall submit a tax declaration dossier within 10 days after the land area increases or decreases.

- A taxpayer eligible for house and land tax exemption or reduction shall still submit a house and land tax declaration dossier together with documents related to the determination of tax exemption or reduction for the first year and the year following the year of expiration of the tax exemption or reduction duration.

c/ A house and land tax declaration dossier is:

- The house and land tax return made according to form No. 01/NDAT provided in this Circular, for organizations; or

- The house and land tax return made according to form No. 02/NDAT provided in this Circular, for households and individuals.

d/ Determination of payable house and land tax amounts:

- Organizations shall determine by themselves their payable tax amounts in their house and land tax returns.

- For house and land tax of a household or individual: the district-level Tax Department shall, based on the tax register of the previous year or the house and land tax return of the year, calculate the tax amount and issue a notice of house and land tax payment according to form No. 03/NDAT provided in this Circular to the taxpayer.

- The payable house and land tax amount of a year shall be paid twice, with each payment equal to 50% of the payable tax amount.

A taxpayer who wishes to pay house and land tax in lump-sum shall pay it by the deadline for the first tax payment of the year.

e/ Deadlines for tax agencies to issue notices of house and land tax payment to households and individuals as follows:

- April 30 for notices of the first payment of house and land tax in the year; the deadline for tax payment is May 31.

- September 30 for notices of the second payment of house and land tax in the year; the deadline for tax payment is October 31.

- After issuing tax notices, if tax agencies receive additional tax declaration dossiers, they shall issue tax payment notices according to additional declaration dossiers within 10 days from the date of receiving these dossiers.

- In case the payable house and land tax amount in a year is under VND 100,000, tax agencies shall notify the payable tax amount for the whole year by the deadline for sending notices of the first payment in the year.

2. Declaration of agricultural land use tax

a/ Agricultural land use taxpayers shall submit agricultural land use tax declaration dossiers to district-level Tax Departments of the localities which exists land liable to agricultural land use tax (or commune-level People's Committees which compile tax registers).

b/ Deadlines for submission of agricultural land use tax declaration dossiers:

- For organizations, the deadline for submission of agricultural land use tax declaration dossiers is January 30.

- Households and individuals using land which has been liable to tax and recorded in tax agencies' tax registers are not required to submit agricultural land use tax declaration dossiers for the subsequent year.

- The time limit for submission of dossiers of declaration of agricultural land use tax for land areas under perennial crops to be harvested only once is 10 days from the date of harvest.

- A taxpayer whose land area liable to agricultural land use tax increases or decreases shall submit tax declaration dossiers within 10 days after the occurrence of such increase or decrease.

- A taxpayer who is eligible for agricultural land use tax exemption or reduction shall submit a tax declaration dossier together with documents related to the determination of tax exemption or reduction for the first year and the year following the year of expiration of the tax exemption or reduction duration.

c/ An agricultural land use tax declaration dossier is:

- The agricultural land use tax return made according to form No. 01/SDNN provided in this Circular, for organizations;

- The agricultural land use tax return made according to form No. 02/SDNN provided in this Circular, for households and individuals; or

- The agricultural land use tax return made according to form No. 03/SDNN provided in this Circular, for tax declaration for land areas under perennial crops to be harvested only once.

d/ Determination of payable agricultural land use tax amounts:

- Organizations shall determine by themselves their payable agricultural land use tax amounts in their agricultural land use tax returns.

- For agricultural land use tax of a household or individual: the district-level Tax Department shall, based on the tax register of the previous year or agricultural land use tax return of the year, calculate the tax amount and issue to the taxpayer a notice of agricultural land use tax payment according to form No. 04/SDNN provided in this Circular provided in this Circular.

- For agricultural land use tax on land areas under perennial crops to be harvested only once, taxpayers shall determine by themselves their payable agricultural land use tax amounts, if taxpayers cannot determine their payable tax amounts, tax agencies shall assess payable tax amounts and notify them to taxpayers.

e/ Deadlines for tax agencies to issue notices of agricultural land use tax payment to households and individuals:

- April 30 for notices of the first payment of agricultural land use tax payment in the year; the deadline for tax payment is May 31.

- September 30 for notices of the second payment of agricultural land use tax payment in the year; the deadline for tax payment is October 30.

- After issuing tax notices, if tax agencies receive additional tax declaration dossiers, they shall issue tax payment notices according to additional declaration dossiers within 10 days from the date of receiving these dossiers.

For localities in which the agricultural crop harvest time does not coincide with the tax payment deadlines specified at this Point, district-level Tax Departments may set other deadlines for tax payment notification and tax payment which must not be over 30 days later than the deadlines specified at this Point. A taxpayer who wishes to pay the agricultural land use tax amount in lump-sum for the whole year shall pay it by the deadline for the first tax payment in the year.

3. Declaration of land and water surface rents and notices of land and water surface rent payment:

a/ Land and water surface lessees shall make land and water surface rent declarations according to form No. 01/TMDN provided in this Circular and submit them together with land and water surface rent dossiers to land use right registration offices or natural resources and environment agencies. In localities which have not yet applied the one-stop-shop mechanism, taxpayers shall submit land and water surface rent declaration dossiers to tax agencies of the localities in which exists the rented land or water surface.

The time limit for submission of land and water surface rent declaration dossiers is 30 days after the issuance of land or water surface rent decisions.

Land and water surface lessees who have submitted land and water surface rent declaration dossiers or paid rents according to tax agencies' notices are not required to submit land and water surface rent declaration dossiers.

Upon occurrence of a change in the area stated in a land and water surface lease contract, in land location or in entities eligible for land rent exemption or reduction, leading to a change in the payable rent amount, the land and water surface lessee shall make and submit a new land and water surface rent payment dossier and submit it to a tax agency within 30 days after a competent authority issues a document to acknowledge this change.

b/ Notification of land or water surface rent payment

b. 1/ For a new land and water surface lessee: The land use right registration office or natural resources and environment agency shall transfer the land and water surface rent declaration dossier to the tax agency directly managing the taxpayer. Within 5 working days after receiving a valid land and water surface rent declaration dossier, the tax agency shall determine the payable land and water surface rent and send a notice of land rent payment, made according to form No. 02/TMDN provided in this Circular, through the land use right registration office or natural resources and environment agency to the land and water surface lessee for information and payment of land and water surface rent into the state budget.

b.2/ For taxpayers who pay land or water sort ace rent on an annual basis from the second year on, tax agencies shall send notices of land rent payment to them by the following deadlines:

- April 30 for notices of the first payment of land and water surface rent in the year; the rent payment deadline is May 31.

- September 30 for notices of the second payment of land and water surface rent in the year; the rent payment deadline is October 30.

In case land and water surface rent rates are adjusted by a competent agency, tax agencies shall re-determine payable land and water surface rents and notify them to concerned taxpayers.

A land and water surface lessee who wishes to pay land and water surface rent in lump-sum for the whole year shall pay it by the deadline for the first payment in the year.

In case land and water surface rent is paid in lump-sum for the whole lease period, taxpayers shall fully pay rent into the state budget within 30 days after the receipt of rent payment notices.

4. Declaration of land use levy:

a/ Land users shall make land use levy declarations according to form No. 01/TSDD provided in this Circular and submit them Together with documents related to the determination of financial obligations according to law to land use right registration offices or natural resources and environment agencies. In localities which have not yet applied the one-stop-shop mechanism, taxpayers shall submit land use levy declaration dossiers to tax agencies of the localities in which exists the land in use.

b/ Land use rights registration offices or natural resources and environment agencies shall transfer land use levy declaration dossiers of land users to district-level Tax Departments of localities in which exist land areas with land use rights certificates.

c/ Within 3 working days after receiving complete land use levy declaration dossiers, tax agencies shall determine payable land use levy amounts and send notices of land use levy payment, made according to form No. 02/TSDD provided in this Circular, to land use rights registration offices or natural resources and environment agencies for delivery to land users.

d/ In case of land use right auctions, taxpayers shall pay land use levy according to the law on auction.

e/ The time limit for payment of land use levy is 30 days after taxpayers receive tax payment notices.

Article 17. Declaration of charges and fees 1. Declaration of registration fee:

a/ Responsibility to submit registration fee declaration dossiers and places of submission of registration fee declaration dossiers:

Organizations and individuals, that have assets liable to registration fee shall declare registration fee and submit registration fee declaration dossiers to tax agencies within the time limit prescribed by the law on registration fee.

- Dossiers of declaration of registration fee for houses and land shall be submitted to land use right registration offices or natural resource and environment agencies of the localities in which exist houses or land. In localities which have not yet applied the one-stop-shop mechanism, house and land registration fee declaration dossiers shall be submitted to district-level Tax Departments of the localities in which exist houses or land.

- Dossiers of declaration of registration fee for other assets, such as means of transport, guns, etc., shall be submitted to district-level Tax Departments in which the ownership or use right of these assets is registered.

b/ A house and land registration fee declaration dossier comprises:

- A registration fee return, made according to form No. 01/LPTB provided in this Circular;

- Papers evidencing the lawful origin of the house and land;

- Papers proving that the property (or property owner) is not liable to or is exempt from registration fee (if any).

c/ A dossier of declaration of registration fee for other assets (except for fishing or inland waterway ships and seagoing vessels without original dossiers or built in Vietnam defined at Point e, Clause 1 of this Article) comprises:

- A registration fee return, made according to form No. 02/LPTB provided in this Circular;

-A lawful asset purchase invoice (in case of purchase and sale, transfer or exchange of assets in which the asset deliverer is a production or business organization or individual); or sale invoice of confiscated goods (in case of purchase of confiscated goods); or decision on assignment, transfer or liquidation of assets (in case a state administrative and non-business agency, state judicial agency, administrative and non-business agency of a political organization, socio-political organization, social organization or socio-professional organization not engaged in production or business operations assigns assets to another organization or individual); or paper on asset assignment signed between the asset assignor and the asset assignee certified by a state notary public or a competent state agency (in case of asset assignment between individuals or natural persons not engaged in production or business operations).

- Papers proving that the asset (or the asset owner) is not liable to or is exempt from registration fee (if any).

d/ Papers proving that the asset or the asset owner is not liable to or is exempt from registration fee in some cases are specified as follows:

The papers defined at this Point are originals or notarized or certified copies (except cases subject to specific regulations).

d.1/ For religious institutions and worship institutions which are recognized by the State or licensed to use land for public purposes:

- Papers proving that religious institutions' operation is licensed by the State;

- A decision on the grant of a land use right certificate or a land assignment decision.

d.2/ For assets exclusively used for national defense or security: Copies (appended with agencies' seal for certification) of a competent authority's decision approving the assignment or procurement of assets exclusively used for national defense or security; or a written certification of a public security or national defense agency's competent authority that these houses, land or assets are exclusively used for national defense or security purposes.

d.3/ For houses and land received as compensations:

- A decision on the recovery of the old house and land and a decision on the allocation of a new house and land, issued by a competent state agency.

- A certificate of land use rights or house ownership rights of the land user or house owner whose land is recovered, granted by a competent agency without any note on owed financial obligations;

In case a house owner or land user has fully paid the registration fee but not yet been granted or have lost his/her house ownership or land use right certificate, he/she shall produce the receipt of payment of registration fee for house or land which is recovered by the State (or the written certification of house and land dossier management agency); or a decision on registration fee exemption, issued by a competent state agency.

- Lawful house or land sale/purchase or transfer invoices or contracts as prescribed by law, enclosed with original receipts of compensation or support from house and land recovering agencies (for case in which compensation and support are paid in cash).

Tax officers, after allowing the non-collection of registration fee for houses and land received as compensations or purchased with compensation money shall write: "Registration fee is not collected for declaration No…." and sign and affix a seal on the upper left comer of the compensation money receipt.

d.4/ For cases of renewal of asset ownership or use right certificates, granted documents proving the asset ownership or use rights are required.

d.5/ Joint-stock companies making registration fee declaration for assets of which the ownership or use rights used to belong to equitized enterprises shall provide to tax agencies the following dossiers:

- A copy (affixed with the company' seal as certification) of a competent state agency's decision on the transformation of an enterprise into a joint-stock company.

- A list of assets transferred from the enterprise into the joint-stock company (for enterprises subject to partial equitization, a decision on the transfer of the enterprise's assets is required), inscribing with the names of assets for which procedures for registration fee declaration are carried out.

d.6/ For assets for which the registration fee has been paid and which are transferred or divided to capital contributors:

- Papers proving that the person having the asset is a member of that organization (the organization establishment decision or operation charter, inscribing with the names of members who contribute assets as capital or papers proving the contribution of assets as capital or the business registration certificate, inscribing with the names of members who contribute assets as capital and papers proving the contribution of assets as capital);

- A decision on dissolution, division, splitting, consolidation or merger of the organization or the division of assets to capital contributors.

- A registration fee receipt (for cases liable to registration fee) or registration fee return, in which the part reserved for certification by tax agencies states: not liable to registration fee (for cases which are not liable to registration fee under law), handed over by the transferor to the transferee; or an asset ownership or use right certificate under the name of the person who contributes assets as capital (in case registration fee is declared by organizations receiving capital contribution) or the name of the dissolved organization (in case registration fee is declared by a member who is divided assets).

- A business cooperation contract (for case of capital contribution) or a decision on division or transfer of assets in the form of recording increase or decrease in contributed capital, issued by a competent authority (for cases of transferring assets among member units 01 within a budget-estimating unit).

d.7/ For gratitude houses or houses built with charitable or humanitarian money: Papers on transfer of land use rights and house ownership rights between the donor and the donee.

d.8/ For financial leasing assets:

-A financial leasing contract signed between the asset lessor and the lessee under the law on financial leasing.

- A minutes on liquidation of the financial leasing contract between the asset lessor and lessee.

- The asset ownership right certificate of the financial leasing company.

d.9/ Spare hulls, frames and complete engine fittings subject to re-registration for which the warranty period has not yet expired:

- The warranty certificate.

- The ex-warehousing slip of the spare asset, enclosed with the paper on the recovery of the old asset issued by the seller to the buyer.

d.10/ When necessary to prove a family bond, any of the following papers may be used: household registration book, marriage certificate, birth certificate or child adoption recognition decision issued by a competent state agency according to law.

e/ A dossier of declaration of registration fee for fishing ships and boats, inland waterway ships and seagoing vessels without original dossiers or newly built in Vietnam comprises:

- A registration fee return, made according to form No. 02/LPTB provided in this Circular;

- A competent agency's notice or certification of the ship or boat's eligibility for ownership registration (for securing the interests of those that have paid registration fees but are not granted an ownership or use right registration certificate by a competent state agency).

f/ District-level Tax Departments shall issue notices of registration fee payment within 3 working days (for houses and land) or 1 working day (for ships, boats, cars, motorcycles, hunting rifles and sports guns) after receiving complete and valid dossiers. They shall return invalid dossiers to land use rights registration offices or natural resources and environment agencies (for house and land registration fee dossiers), or to asset owners (for dossiers of registration fee for other assets) within the time limit specified at this Point.

Notices of payment of registration fee for houses and land shall be made according to form No. 01-1/LPTB provided in this Circular. Notification of payment of registration fee for other assets shall be written on registration fee returns for those assets.

g/ The time limit for registration fee payment is 30 days after taxpayers receive payment notices.

2. Declaration of petrol and oil charge:

a/ Petrol and oil charge payers shall submit petrol and oil charge declaration dossiers to tax agencies directly managing them.

b/ Petrol and oil charge declaration is made on a monthly basis.

c/ Petrol and oil charge declaration dossiers are petrol and oil charge returns made according to from No. 01/PHXD provided in this Circular.

3. Declaration of environmental protection mineral for mineral exploitation:

a/ Organizations and individuals engaged in mineral exploitation shall submit environmental protection charge declaration dossiers to their managing tax agencies. If organizations collecting and purchasing minerals have registered for payment of environmental protection charge on behalf of exploiters, they shall submit environmental protection charge declaration dossiers to tax agencies directly managing them.

b/ Environmental protection charge is declared on a monthly basis and finalized on an annual basis.

Declaration for finalization of environmental protection charge for mineral exploitation include annual finalization declaration and declaration for finalization up to the time of termination of mineral exploitation, mineral purchase or business operations, expiration of contracts, transformation of enterprise ownership or enterprise reorganization.

c/ A dossier of monthly environmental protection charge declaration is the environmental protection charge return, made according to form No. 01/BVMT provided in this Circular.

d/ A dossier of environmental protection charge finalization is the environmental protection charge finalization return, made according to form No. 02/BVMT provided in this Circular.

4. Declaration of other charges and fees belonging to the state budget:

a/ Agencies and organizations tasked to collect charges and fees belonging to the state budget shall submit charge and fee declaration dossiers to tax agencies directly managing them.

b/ Charges and fees belonging to the state budget is declared on a monthly basis and finalized on an annual basis.

c/ A dossier of monthly declaration of charges and fees belonging to the state budget is the charge and fee return made according to form No. 01/PHLP provided in this Circular.

d/ A dossier of declaration for annual finalization of charges and fees belonging to the state budget is the charge and fee return made according to form No. 02/PHLP provided in this Circular.

Article 18. Declaration of value-added tax and enterprise income tax of foreign contractors and foreign sub-contractors

- Foreign contractors and foreign sub-contractors being business organizations shall declare value-added tax (VAT) and enterprise income tax (EIT) under this Article..

Foreign contractors and foreign sub­contractors being business individuals shall declare VAT under this Article and declare PIT under Article 14 of this Circular.

1. Tax declaration in case of VAT payment by the tax withholding method and EIT payment on the basis of declaring turnover and expenses for determination of EIT-liable incomes

- Within 20 working days after signing a contract, the Vietnamese party signing the contract with a foreign contractor or a foreign contractor signing the contract with a foreign sub-contractor shall notify in writing tax agencies of the foreign contractor's or sub-contractor's payment of VAT by the withholding method and payment of EIT on the basis of declaring turnover and expenses for determination of EIT-liable incomes.

- When being granted a tax registration certificate by tax agencies, a foreign contractor or foreign sub-contractor shall send a copy of this certificate, bearing its certification, to the Vietnamese party or foreign contractor. In case of arising a payment to the foreign contractor while the Vietnamese party has not yet received a copy of the foreign contractor's tax registration certificate, the Vietnamese party shall temporarily withhold and pay the payable VAT and EIT amounts for the foreign contractor under the Clause 2 of this Article.

a/ VAT declaration

Foreign contractors shall declare VAT under Article 10 of this Circular.

b/ EIT declaration

Foreign contractors shall declare EIT under Article 11 of this Circular.

c/ Dossiers of notification of tax exemption or reduction under agreements

A foreign contractor eligible for tax exemption or reduction under a double taxation avoidance agreement between Vietnam and another country or territory shall additionally carry out the following procedures:

When temporarily calculating EIT, the taxpayer shall send a dossier of notification of eligibility for tax exemption or reduction under an agreement to the tax agency together with a quarterly EIT return made according to form No. 01A/TNDN or No. 01B/TNDN provided in this Circular. A dossier comprises:

- A notice of eligibility for tax exemption or reduction under an agreement, made according to formNo. 01/HTQT provided in this Circular;

A taxpayer who, in force majeure circumstances, is unable to provide sufficient information or documents as required for this notice shall make detailed explanation therefor.

- The original certificate of residence granted by a tax agency of the country of residence in the year preceding the year of notification of eligibility for tax exemption or reduction under the agreement, which has been consularly legalized;

- Copies of contracts signed with domestic or overseas organizations and individuals, bearing the taxpayer's certification.

In case a taxpayer has already notified its eligibility for tax exemption or reduction under an agreement for a year, it is required to send only copies of contracts newly signed with domestic and overseas organizations and individuals (if any) for subsequent years.

When making EIT finalization declaration, the taxpayer shall send a certificate of residence for that tax year, which has been consularly legalized, and a written certification of performance of contracts, made by contracting parties, together with a EIT finalization return, made according to form No. 03/TNDN provided in this Circular.

d/ In case a foreign contractor or foreign sub­contractor performing tax obligations under Clause 1 of this Article signs a new contract for contractor/sub-contractor operation in Vietnam while its current contract has not yet expired, it shall continue declaring and paying tax under Clause 1 of this Article.

In case the foreign contractor or foreign sub­contractor signs a new contract for contractor/ sub-contractor operation in Vietnam while its current contract has expired, it shall perform tax obligations for the new contract under Clause 1 of this Circular on the condition that it is still allowed to declare VAT by the withholding method and declare EIT on the basis of declaring turnover and expenses for determination of EIT-liable incomes.

In case a foreign contractor for foreign sub­contractor performs many contracts simultaneously, if it is qualified for making tax declaration under Clause 1 of this Article for any of these contracts, it shall declare tax under Clause 1 of this Article for all remaining contracts (including unqualified ones).

2. Tax declaration in case of payment of VAT calculated directly on the added value and payment of E1T on a percentage of turnover

- In case of payment of VAT calculated directly on the added value and payment of EIT on a percentage of turnover, tax shall be declared for each time of payment to foreign contractors and finalized upon expiration of contracts for contractor operations.

If a Vietnamese party makes many payments to a foreign contractor in a month, it may register for monthly tax declaration instead of declaration for each time of payment to the foreign contractor.

- Vietnamese parties signing contracts with foreign contractors shall withhold and pay tax for foreign contractors and submit tax declaration dossiers and tax finalization declaration dossiers to tax agencies directly managing them.

For construction and installation contracts, tax declaration dossiers and tax finalization declaration dossiers shall be submitted to tax agencies of localities in which construction and installation activities are carried out.

- Vietnamese parties shall make tax registration with tax agencies directly managing them in order to pay tax on behalf of foreign contractors or sub-contractors within 20 working days after signing contracts.

a/ Tax declaration for business operations and incomes of other kinds

a.1/ A tax declaration dossier comprises:

- A tax return, made according to form No. 01/NTNN provided in this Circular;

- A copy of the contract for contractor or sub-contractor operation, bearing the taxpayer's certification (for the first-time tax declaration for the contract);

- A copy of the business license or the practice license, bearing the taxpayer's certification.

a.2/ Dossiers of notification of tax exemption or reduction under agreements:

For a foreign contractor eligible for tax exemption or reduction under a double taxation avoidance agreement between Vietnam and another country or territory, the following procedures shall be additionally carried out:

Fifteen days before the tax declaration deadline, the Vietnamese party that signs a contract with or pays income to the foreign contractor shall send to the tax agency a dossier of notification of eligibility for tax exemption or reduction under agreement, comprising:

- A notice of eligibility for tax exemption or reduction under an agreement, made according to form No. 01/HTQT provided in this Circular;

A taxpayer who, in force majeure circumstances, is unable to supply sufficient information or documents as required for this notice shall make detailed explanation therefor.

- The original certificate of residence granted by a tax agency of the country of residence in the year preceding the year of notification of eligibility for tax exemption or reduction under the agreement, which has been consularly legalized;

- Copies of contracts signed with domestic or overseas organizations and. bearing the taxpayer's certification.

+ For incomes from securities sale and purchase without securities sale and purchase contracts, the taxpayer shall submit certificates of stock or bond depository accounts, made according to form No. 01/TNKDCK provided in this Circular and certified by the depository bank or securities company.

+ For incomes from capital transfer: Taxpayers shall additionally submit copies of capital transfer contracts, certified by the taxpayers, copies of investment certificates issued by Vietnamese companies to which foreign investors contribute capital and certified by the taxpayers.

In case a taxpayer has already notified its eligibility for tax exemption or reduction under an agreement for a year, it is required to send only copies of contracts newly signed with domestic and overseas organizations and individuals (if any) for subsequent years.

Fifteen days before the expiration of its contract for working in Vietnam or the end of the tax year, whichever is earlier, the foreign contractor shall send the certificate of residence of that tax year, which has been consularly legalized, and a copy of its passport to the Vietnamese contracting or income-paying party.

If no certificate of residence is available at that time, the taxpayer shall commit to sending this certificates, which have been consulately legalized, within the first quarter of the following year.

b/ Tax declaration for foreign airlines

Vietnam-based booking offices and agents of foreign airlines shall declare and pay EIT for their foreign airlines.

Tax declaration dossiers shall be submitted to tax agencies directly managing Vietnam-based booking offices and agents of foreign airlines.

EIT for foreign airlines shall be declared on a monthly basis.

b.1/ Tax declaration dossiers:

- A (ax return applicable to foreign airlines, made according to form No. 01/HKNN provided in this Circular.

- Copies of the contract for contractor or subcontractor operations, bearing the taxpayer's certification (for the first-time tax declaration for the contract);

- A copy of the business license or the practice license, bearing the taxpayer's certification.

b.2/ Dossiers of notification of tax exemption or reduction under agreements:

For a foreign airline eligible for tax exemption or reduction under a double taxation avoidance agreement between Vietnam and another country or territory, the following additional procedures shall be carried out:

Fifteen days prior to the first flight or the first tax period of the year, whichever is earlier, the Vietnam-based office of a foreign airline shall send to tax agencies a dossier of notification of eligibility for tax exemption or reduction under agreement, comprising:

+ A notice of eligibility for tax exemption or reduction under an agreement, made according to form No. 01/HTQT provided in this Circular;

A taxpayer who, in force majeure circumstances, is unable to supply sufficient information or documents as required for this notice shall make detailed explanation therefor.

+ The original certificate of residence granted by a tax agency of the country of residence in the year preceding the year of notification of eligibility for tax exemption or reduction under the agreement, which has been consulately legalized;

+ A copy of the permit for exploitation of the Vietnamese market (flight license) granted by the Civil Aviation Administration of Vietnam under the Law on Civil Aviation and certified by the taxpayer.

In case a taxpayer has already notified its eligibility for tax exemption or reduction under an agreement for a year, it is required to only send a copy of the permit for exploitation of the Vietnamese market (flight license) granted by the Civil Aviation Administration of Vietnam for subsequent years.

Fifteen days before the expiration of a contract for working in Vietnam or the end of the tax year, whichever is earlier, the Vietnam-based office of a foreign airline shall send a certificate of residence of the tax year, which has been consularly legalized, and a list of international transportation incomes, made according to form No. 01-1/HKNN, applicable to cases of selling tickets in the Vietnamese market, or form No. 01-2/HKNN provided in this Circular, applicable to cases of booking swap or division, of the relevant tax year for use as a basis for tax agencies to apply EIT exemption or reduction for international transportation incomes of foreign airlines.

c/ Tax declaration applicable to foreign carriers

Organizations acting as shipping or forwarding agents for foreign carriers shall withhold and pay tax for foreign carriers.

Tax declaration dossiers of foreign carriers shall be submitted to tax agencies directly managing shipping or forwarding agents.

Foreign carriers' tax is declared on a monthly basis.

c.1/ A tax declaration dossier comprises:

- A tax return applicable to foreign carriers, made according to form No. 01/VTNN provided in this Circular;

- A list of international transportation incomes, made according to form No. 01-1/VTNN applicable to enterprises that directly operate means of transport, or form No. 01-2/VTNN, applicable to cases of booking swap or division, or a list of turnovers from container keeping, made according to form.No.01-3/VTNN provided in this Circular.

c.2/ Dossiers of notification of tax exemption or reduction under agreements:

In case a foreign carrier is eligible for tax exemption or reduction under a double taxation avoidance agreement between Vietnam and another country or territory, the following procedures shall be additionally carried out:

When submitting the tax return for the first tax period of the year to tax agencies, the foreign carrier or its agent shall enclose a dossier of notification of eligibility for tax exemption or reduction under an agreement, comprising:

- A notice of eligibility for tax exemption or reduction under an agreement, made according to form No. 01/HTQT provided in this Circular;

A taxpayer who, in force majeure circumstances, is unable to supply sufficient information or documents as required for this notice shall make detailed explanation therefor.

- The original certificate of residence granted by a tax agency of the foreign carrier's host country for the tax year preceding the year of notification of eligibility for tax exemption or reduction under the agreement, which has been consularly legalized;

- A document evidencing the carrier's direct operation of ships, which is any of the following documents:

+ A copy of the ship ownership registration, certified by the taxpayer;

+ A copy of the ship charter contract (if the carrier charters or is given the right to use the ship), certified by the taxpayer;

+ The original license for ship operation along a fixed route, or its copy certified by the port authority;

+ The original port entry permit, or its copy certified by the port authority;

+ The port authority's original certificate of the carrier's ships entering a Vietnamese port;

+ Other documents.

A foreign carrier that is involved in partnership, space swap or lease or bareboat charter, etc., shall additionally supply relevant documents (such as partnership contract for joint operation of means of transport, contracts on space swap or contracts on bareboat charter, etc.).

At the year end, the foreign carrier or its agents shall send to tax agencies a certificate of residence for the year, which has been consularly legalized.

In case a foreign carrier or its agent has already notified its eligibility for tax exemption or reduction under an agreement for a year, it is only required to notify changes in its business situation, if any, such as changes in business registration or change in ownership or operation of means of transport for subsequent years and supply documents evidencing these changes.

In case a foreign carrier has a primary agent, secondary agents and branches in different localities of Vietnam, the foreign carrier or its agent shall submit the original certificate of residence, which has been consularly legalized, and tax registration certificate (or business registration certificate) to the provincial-level Tax Department of the locality in which its primary agent's head office is located and send copies of these papers, certified by the primary agent, to provincial-level Tax Departments of the localities in which secondary agents or branches are located. In its notice of eligibility for tax exemption or reduction under an agreement, the taxpayer shall clearly state the name of the Tax Department to which it has submitted the original certificate of residence.

d/ Tax declaration for foreign reinsurance Vietnamese parties shall withhold, declare and pay tax for foreign reinsurance organizations.

Tax declaration dossiers shall be submitted to tax agencies directly managing Vietnamese parties.

Tax for foreign reinsurance shall be declared on a quarterly basis.

d.1/ Tax declaration dossiers:

- A tax return applicable to foreign reinsurance organizations, made according to form No. 01/TBH provided in this Circular;

- A copy of the reinsurance policy, certified by the taxpayer (for first-time tax declaration for the reinsurance policy);

- A copy of the business license or practice certificate, certified by the taxpayer.

d.2/ Dossiers of notification of tax exemption or reduction under agreements

A foreign reinsurance organization shall submit a dossier of notification of eligibility for application of a double taxation avoidance agreement for each year for all reinsurance policies it has signed or projects to sign in the year. Foreign reinsurance organizations may authorize tax agents, their Vietnam-based representative offices or Vietnamese reinsurance companies to submit dossiers. In these cases, a foreign reinsurance organization shall submit to tax agencies 2 notification dossiers, one dossier of notification for projected policies and one dossier for notification for official policies. Specifically:

d.2.1/ For dossiers of notification for projected policies:

- The time limit of submission of a dossier of notification of eligibility for tax exemption or reduction under an agreement for projected policies: 5 days before signing policies, 5 days after performing contracts or 5 days before making payment, whichever is earlier.

- Places of submission of dossiers of notification of eligibility for tax exemption or reduction under an agreement:

+ For foreign reinsurance organizations which have representative offices in Vietnam: Provincial-level Tax Departments of localities in which their representative offices are located.

+ For foreign reinsurance organizations without representative offices in Vietnam:

In case a foreign insurance organization directly submits dossiers: The provincial-level Tax Department of the locality in which the Vietnam reinsurance company with which it projects to sign the first contract is located;

In case a foreign reinsurance organization authorizes its lawful representative in Vietnam to submit dossiers, dossiers shall be submitted to the provincial-level Tax Department of the locality in which the at-law representative has registered for tax payment. For example: the tax agent, audit company or the Vietnamese reinsurance company with which it projects to sign the first contract.

- A dossier of notification of eligibility for tax exemption or reduction under an agreement comprises:

+ A notice, made according to form No. 01/TBH-TB provided in this Circular.

A taxpayer who, in force majeure circumstances, is unable to provide sufficient information or documents as required for this notice, shall make detailed explanation therefor.

+ The original certificate of residence, which is granted by the tax agency of the host country and has been consularly legalized (for the year preceding the year of submitting dossier).

+ A list of reinsurance policies which have been or are expected to be signed, made according to form No. 01-1/TBH-TB provided in this Circular.

d.2.2/ For official notification dossiers

- Time for dossier submission: In the first quarter of the subsequent year, foreign reinsurance organizations shall send dossiers of a official notification, enclosed with relevant dossiers.

- Places of submission: Similar to the places of submission of unofficial notification dossiers.

- A dossier to be submitted to tax agencies comprises:

+ A notice, made according to form No. 02/TBH-TB provided in this Circular.

A taxpayer who, in force majeure circumstances, is unable to provide sufficient information or documents as required for this notice shall make detailed explanation therefor.

+ The original certificate of residence, which is granted by the tax agency of the host country and has been consularly legalized.

+ Copies of reinsurance policies already performed in the year but not yet submitted to tax agencies (including policies inside or outside the plan already sent to tax agencies), certified by the taxpayer.

+ A list of policies classified according to their types, made according to form No. 02-1/ TBH-TB provided in this Circular. At the time of submission of official notification dossiers, taxpayers shall classify policies and send lists of policies classified according to their types (classified according to certain criteria); they are only required to send one copy, certified by the taxpayer, for each type of contracts for use as samples. Taxpayers shall take responsibility for their statistics.

d.2.3/ Procedures for application of agreements:

- Within 15 working days after receiving a complete unofficial dossier of notification of EIT exemption or reduction under an agreement from a foreign reinsurance organization, the tax agency shall issue a certificate of submission of a complete notification dossier and make certification right in the notice. When signing reinsurance policies, the foreign reinsurance company may supply to each of Vietnamese contracting parties a duly certified copy of this certificate for temporary tax exemption or reduction under an agreement. An unofficial notice shall be made in 2 copies, one to be kept by the applicant and the other to be preserved at the provincial-level Tax Department.

- Tax agencies shall examine notification dossiers submitted by foreign reinsurance organizations. If detecting that a dossier is incorrect or incomplete or the taxpayer is ineligible for application of an agreement, they shall notify thereof to the applicant or the taxpayer.

e/ Finalization declaration dossiers:

- A contractor tax finalization return, made according to form No. 02/NTNN provided in this Circular;

- A list of foreign contractors and Vietnamese sub-contractors involved in the performance of the contract, made according to forms No. 02-1/NTNN and No. 02-2/NTNN provided in this Circular;

- A list of tax payment documents;

- A contract liquidation document.

3. Tax declaration for cases of payment of VAT by the withholding method and payment of EIT on a percentage of turnover

- Foreign contractors and sub-contractors that directly declare VAT by the withholding method and declare EIT on a percentage of turnover shall submit tax declaration dossiers and tax finalization declaration dossiers to tax agencies directly managing Vietnamese parties.

For construction and installation contracts, tax declaration dossiers and tax finalization declaration dossiers shall be submitted to tax agencies of the localities in which construction and installation activities are carried out.

- Within 20 working days after signing a contract with a foreign contractor or sub­contractor, the Vietnamese party or foreign contractor signing the contract shall notify the tax agency with which such foreign contractor or sub-contractor has registered for tax payment of the foreign contractor's or sub-contractor's direct registration and payment of VAT by the withholding method and payment of EIT on a percentage of turnover.

- When being granted a tax registration certificate by tax agencies, a foreign contractor or sub-contractor shall send a copy of the tax registration certificate, bearing its certification, to the Vietnamese party or foreign contractor. In case of arising a payment to a foreign contractor while the Vietnamese party has not yet received a copy of the foreign contractor's tax registration certificate, the Vietnamese party shall temporarily withhold and pay the payable VAT and EIT amounts for the foreign contractor under Clause 2 of this Article.

a/ Declaration of VAT calculated by the withholding method complies with Article 10 of this Circular.

b/ In case of payment of EIT on a percentage of turnover, tax shall be declared for each time of payment to foreign contractors and finalized upon expiration of contracts.

A foreign contractor who receives many payments in a month may register for monthly tax declaration instead of declaration for each time of payment.

b.1/ Tax declaration dossiers:

- A tax return, made according to form No. 03/NTNN provided in this Circular;

- Copies of the contract for contractor or sub­contractor operations, certified by the taxpayer (for the first-time tax declaration for the contract);

- A copy of the business license or the practice license, certified by the taxpayer.

a. 2/ Dossiers of notification of tax exemption or reduction under agreements

For a foreign contractor eligible for tax exemption or reduction under a double taxation avoidance agreement between Vietnam and another country or territory, the following procedures shall be additionally carried out:

Fifteen days before the tax declaration deadline, the foreign contractor shall send to tax agencies a dossier of notification of eligibility for tax exemption or reduction under and agreement, comprising:

- A notice of eligibility for tax exemption or reduction under an agreement, made according to form No. 01/TNDN provided in this Circular;

A taxpayer who. in force majeure circumstances, is unable to supply sufficient information or documents as required for this notice shall make detailed explanation therefor.

+ The original certificate of residence granted by a tax agency of the country of residence in the year preceding the year of notification of eligibility for tax exemption or reduction under the agreement, which has been consulately legalized;

+ Copies of the contracts signed with organizations and individuals in Vietnam, certified by the taxpayer.

In case a foreign contractor has already notified its eligibility for tax exemption or reduction under an agreement for a year, it is only required to send copies of economic contracts newly signed with domestic and foreign organizations and individuals (if any), certified by the taxpayer, for subsequent years.

Fifteen days before the expiration of its contract for working in Vietnam or the end of the tax year, whichever is earlier, a foreign contractor shall send a certificate of residence of the tax year, which has been consularly legalized, to the Vietnamese contracting or income-paying party.

If no certificate of residence is available by that time, the foreign contractor shall commit to sending this certificate, which has been consularly legalized, within the firsf quarter of the following year.

b.3/ Tax finalization declaration dossiers:

- A contractor tax finalization return, made according to form No. 04/NTNN provided in this Circular;

- A list of Vietnamese sub-contractors engaged in the performance of the contract, made according to form No. 02-2/NTNN provided in this Circular;

- A list of tax payment documents;

- A contract liquidation documents.

4. Tax declaration in case foreign contractors entering partnerships with Vietnamese economic organizations to conduct business operations in Vietnam on the basis of contractor operation contracts

a/ In case parties to a partnership form a cost-accounting executive board which has a bank account and takes responsibility for the issuance of invoices, or the Vietnamese economic organization to the partnership conducts accounting for, and distributes profits to parties, the executive board of the partnership or the Vietnamese economic organization shall declare, pay and finalize VAT and EIT according to regulations for the whole amount of turnover from the performance of the contractor operation contract under Articles 10 and 11 of this Circular.

b/ In case parties enter into a partnership by the mode of sharing turnover, sharing products or jointly undertake a contractual job but each party performs a separate part and determine its turnover by itself, the foreign contractor may declare and pay tax under Clauses 1,2 and 3 of this Article.

Article 19. Tax declaration and determination of payable tax amounts by the presumption method, and tax declaration for real estate leasing activities

1. Households and individuals engaged in business operations or natural resource exploitation and paying tax by the presumption method (below collectively referred to as households paying presumptive tax) include:

a/ Business households and individuals without business registration or not required to make business registration that fail to make tax registration or still fail, though having been urged by tax agencies, to make tax registration within the time limit stated in tax agencies' notices.

b/ Business households and individuals that fail to practice the invoice- and voucher-based accounting.

c/ Business households and individuals that do not submit tax returns according to regulations.

d/ Business households and individuals that keep accounting books but are detected through inspection by tax agencies to have improperly observed the accounting regulations or improperly and inadequately kept invoices and vouchers of purchased or sold goods and services, or made inaccurate and untruthful tax declarations; and therefore, tax agencies cannot base on those accounting books, invoices and vouchers to determine payable tax amounts suitable to their actual business operations.

Households and individuals engaged in manual, scattered, mobile or irregular exploitation of natural resources.

2. Taxes and charges which can be collected by the presumption method include:

a/ Excise tax;

b/ Royalty;

c/ Value-added tax;

d/ Environmental protection charge for natural resource exploitation.

3. Presumptive tax declaration dossiers shall be submitted to district-level Tax Departments of the localities in which business operations or mineral resource exploitation activities are carried out.

a/ Business households and individuals shall pay presumptive tax amounts according to form No. 01/THKH provided in this Circular.

b/ Households and individuals that mine natural resources or minerals shall pay presumptive tax amounts according to form No. 02/THKH provided in this Circular.

4. Time limit for submission of presumptive tax declaration dossiers:

Business households and individuals that pay tax according to the presumption method shall declare tax on an annual basis and are not required to pay tax if their turnover is equal to or smaller than the tax-exempt turnover specified in Clause 5 of this Article.

From November 20 to December 5 of a year, tax agencies shall deliver presumptive tax returns of the subsequent year, form No. 01/THKH, to all business households and individuals that pay tax according to the presumption method.

Tax agencies shall urge business households to fill in and submit tax declaration dossiers to the former by December 31 of a year at the latest.

Those that just start doing business or mining natural resources or minerals shall submit presumptive tax declaration dossiers within 10 days after they start business or mining.

5. Tax-exempt turnover:

The tax-exempt turnover according to the presumption method specified at this Point is determined as follows:

- For households and individuals that have conducted business operations:

Monthly tax - exempt turnover according to the presumption method	=	Common minimum wage level
		Rate of income subject to personal income tax

Of which:

- The common minimum wage level is the monthly minimum wage level applicable in the tax year under the Government's Decree (effective in that year) on region-based minimum wage levels applicable to employees of Vietnamese companies, enterprises, cooperatives, cooperative groups, farms, households and other organizations employing laborers.

- The rate of income subject to PIT income tax is the rate of assessed taxable income issued by the director of a provincial-level Tax Department for application in a locality under the Finance Ministry's guidance.

6. Posting up of lists of business households and individuals not required to pay presumptive tax amounts:

District-level Tax Departments shall publicly post up the tax-exempt turnover according to the presumption method in appropriate places (head offices of commune-level People's Committees and offices of tax teams), and publicly notify such places to business households and individuals from the 1st to the 10th of January every year.

Based on tax agencies' databases, district-level Tax Departments shall coordinate with commune-level Tax Advisory Councils in determining the tax-exempt turnover of business households and individuals, make and publicize lists of these households and individuals at head. offices of commune-level People's Committees and offices of tax teams, then notify these lists to business households and individuals before January 20 every year.

7. Determination of payable presumptive tax amounts for business households and individuals with turnover higher than the tax-exempt turnover:

Based on taxpayers' declarations of turnover, incomes, output and sale prices of exploited natural resources as well as tax agencies' databases, district-level Tax Departments shall coordinate with commune-level Tax Advisory Councils in verifying the correctness and truthfulness of tax declaration dossiers; conduct investigation to re-determine turnover and incomes in case of suspicion of incorrect tax declaration for re-assessing sales, output and sale prices of exploited natural resources. To ensure fair tax determination, before notifying the payable tax amount of each household or individual, the district-level Tax Department shall publicize estimated turnover and payable tax amount of each household or individual paying tax according to the presumption method for comment by business or mining households and individuals; then consult commune-level Tax Advisory Councils in determining and notifying payable tax amounts to households and individuals for compliance.

Presumptive tax amounts shall be determined on a monthly basis and kept stable for a year, unless households change their business lines or scale or mining scale.

A household or individual that ceases business activities for a whole month is not required to pay the tax amount payable in that month. If ceasing business activities for 15 days or more in a month, it/he/she may be considered for 50% reduction of the tax amount payable in that month.

Households or individuals ceasing business activities and eligible for tax exemption or reduction shall make dossiers of request for tax exemption or reduction under Articles 38 and 39 of this Circular.

Based on tax reduction request dossiers, tax agencies shall directly examine them and issue decisions on tax reduction.

8. Time limits for tax notification and payment:

Tax agencies shall send presumptive tax payment notices, made according to form No. 03/THKH provided in this Circular, to households by January 20 at the latest. This notice shall be made once for months of stable tax payment in a year.

Based on these notices, households shall pay monthly tax by the last day of a month at the latest. If they choose to pay tax on a quarterly basis, the deadline for tax payment is the last day of the first month of a quarter.

For royalties, tax agencies may issue notices on seasonal tax payment. They must indicate the tax payment time limit in tax notices and send these notices to households at least 10 days before the tax payment deadline.

9. Determination of tax amounts of business households and individuals paying tax according to the presumption method in case of change in turnover:

- Business households and individuals paying tax according to the presumption method that use invoices with turnover indicated in the invoices smaller than the presumptive turnover shall pay presumptive tax amounts.

- Business households and individuals paying tax according to the presumption method that use invoices with turnover indicated in the invoices higher than the presumptive turnover and can prove that the increased turnover does not result from the change in business scale or lines but is due to unexpected objective causes shall additionally declare the increased turnover and additionally pay VAT. In this case, tax agencies will not adjust the presumptive turnover and tax amounts.

- Households that change business lines or scale or mining scale and output shall make additional declaration to lax agencies from the month such changes occur for the latter to determine presumptive tax amounts suitable to actual tax obligations of taxpayers. Re-declaration dossiers shall be made according to form No. 01/THKH or form No. 02/THKH provided in this Circular.

Tax agencies shall re-determine payable presumptive tax amounts for the months that see changes in business lines or scale or mining scale and output and notify such amounts to taxpayers.

When business households fail to declare changes in business lines or scale to tax agencies or make untruthful declaration, or when tax agencies have documents evidencing that changes in business scale result in increased turnover, tax agencies may request the business households to additionally pay tax on the increased turnover and assess payable tax amounts for tax periods to suit business conditions.

10. Tax declaration by real estate-leasing households and individuals:

Real estate-leasing households and individuals shall declare and pay VAT, unless the revenue from real estate lease is smaller than the tax-exempt turnover specified in Clause 5 of this Article.

For first-time lease of real estate, households or individuals shall declare tax to tax agencies of localities in which exists the real estate for issuance of individual invoices and tax payment. Requests for issuance of individual invoices shall be made under legal documents guiding goods sale and service provision invoices. Based on such requests and enclosed documents on real estate lease, tax agencies shall guide real estate-leasing households and individuals to determine payable VAT amounts under the VAT law. Real estate-leasing households and individuals shall pay tax before receiving individual invoices.

Tax agencies managing localities in which exists the real estate for lease shall coordinate with commune-level People's Committees in making lists of households and individuals with real estate for lease and guiding them to make business and tax registration in order to obtain tax identification numbers if they do not have tax identification numbers.

Households and individuals that lease real estate to lessees that prepay rents for a lease duration shall declare and pay VAT on prepaid rents as in case they declare and pay tax when it arises.

Article 20. Declaration and payment of tax on hydropower generation

1. Declaration and payment of VAT on hydropower generation

Hydropower generation establishments shall declare VAT in localities in which they are headquartered and remit VAT amounts into state treasuries in localities in which hydropower generation plants (turbines, hydropower dams and major physical foundations of power plants) are located. In case a hydropower plant is located in more than one province or centrally run city, the VAT amount to be remitted by the hydropower plant into budgets of provinces or cities will correspond to the value of investment in the plant (including the plant's turbines, hydropower dams and major physical foundations located in the provinces or cities). Hydropower generation establishments shall declare VAT in localities in which they are headquartered and concurrently send VAT returns to tax agencies of the localities which enjoy VAT revenues.

Example: Hydropower plant X is located in provinces A and B. The rate of VAT distribution for provinces A and B is determined as follows:

Hydropower plant	Item	Value (VND billion)			Distribution rate (%)
		Province A	Province B	Total	Province A	Province B
		(1)	(2)	(3) = (l) + (2)	(4) = (l)/(3)	(5) = (2)/(3)
Plant X	Total	560	900	1,460	38.36	61.64
	Turbines	0	UK)	100
	Hydropower dams	350	280	630
	Major physical foundations	210	520	730

Based on the above figures, the VAT amount to be remitted by hydropower plant X into the budget of province A accounts for 38% and, into the budget of province B, 62%.

Hydropower generation establishments shall make VAT declaration according to form No. 01/GTGT provided in this Circular.

Dependent cost-accounting hydropower generation establishments of Electricity of Vietnam (EVN) shall make VAT declaration according to form No. 01/TD-GTGT provided in this Circular.

In case a hydropower generation establishment remits VAT into budgets of provinces corresponding to the value of investment, it shall make a table distributing the VAT amounts to be paid for the provinces according to form No. 01- 1/TD-GTGT provided in this Circular and enclose this table with VAT returns to tax agencies of the localities which enjoy VAT revenues.

2. Declaration and payment of EIT on hydropower generation activities:

a/ Independent cost-accounting hydropower companies shall pay EIT in localities in which they are headquartered. Independent cost-

accounting hydropower companies with dependent cost-accounting hydropower generation establishments operating in provinces or centrally run cities other than those in which the hydropower companies are headquartered; and EVN's dependent cost-accounting hydropower generation establishments (including dependent cost-accounting hydropower companies and dependent hydropower plants) located in provinces or centrally run cities other than those in which EVN offices are headquartered shall pay EIT in localities in which they are headquartered and localities in which dependent cost-accounting hydropower generation establishments are headquartered. The EIT amount to be paid in a province or centrally run city in which a dependent cost-accounting hydropower generation establishment is headquartered equals the EIT amount payable in a period multiplied by (x) the rate of expenses of the dependent cost-accounting hydropower generation establishment to the total expenses of an enterprise.

Independent cost-accounting hydropower companies and EVN shall declare EIT amounts arising in their head offices and dependent cost-accounting units based on lists of EIT to be paid by enterprises with dependent cost-accounting hydropower units according to form No. 02/TD-TNDN provided in this Circular.

b/ In case a hydropower generation plant (with turbines, hydropower dams and major physical foundations) is located in more than one province or centrally run city, it shall make a table distributing EIT amounts to be paid by the plant to these provinces or cities based on the rate of investment in the plant (including turbines, hydropower dams and major physical foundations) according to form No. 02-1/TD-TNDN provided in this Circular. Hydropower generation establishments shall declare EIT in localities in which they are headquartered and send to tax agencies of localities which enjoy EIT revenues the copies of EIT returns and tables of EIT amounts to be paid by enterprises with dependent cost-accounting hydropower units, made according to form No. 02/TD-TNDN provided in this Circular (for enterprises with dependent cost-accounting hydropower units), and tables distributing EIT amounts to be paid by hydropower generation establishments to localities, made according to form No. 02-1/TD-TNDN provided in this Circular.

3. Declaration and payment of royalties on hydropower generation:

Hydropower generation establishments shall declare and pay royalties in localities in which they register royalty declaration and payment according to form No. 03/TD-TAIN provided in this Circular. In casethe bed of the reservoir of a hydropower generation establishment is located in more than one province or centrally run city, the establishment's royalty amount shall be distributed to such provinces or cities. The hydropower generation establishment shall submit royalty declaration dossiers to tax agencies of localities in which they register tax declaration (or they are headquartered) and send, copies of royalty returns to tax agencies of localities which enjoy royalty revenues, and remit royalties into budgets of such provinces or cities based on the area of the reservoir bed; funds for compensation for ground clearance and people relocation and resettlement; number of to-be-relocated households and the value of compensation.

Example: The reservoir bed of hydropower plant X is located in provinces A and B. It shall distribute royalty amounts for these two provinces as follows:

Plant	Item	Province A			Province B
		Figure	Rate	General rate of items (%)	Figure	Rate (%)	General rate of items (%)
Plant X	Reservoir bed area (ha)	1,500	79	63.6	400	21	36.4
	Total households to be relocated (household)	71	42.77		95	57.23
	Value of material damage to the reservoir bed (VND billion)	351	86.03		57	13.97
	Compensation for resettlement support (VND billion)	28	46.67		32	53.33

Based on the above figures, the royalty amount to be remitted by hydropower plant X into the budget of province A accounts for 64% and, into the budget of province B, 36%.

In case the royalty amounts to be remitted by a hydropower generation establishment into budgets of provinces correspond to the establishment's value of investment, it shall make a table distributing royalty amounts to be remitted into local budgets according to form No. 03- 1/TD-TAIN provided in this Circular and send copies of royalty returns to tax agencies of the localities which enjoy royalty revenues.

4. In case a hydropower generation establishment located in more than one province or centrally run city adjusts the VAT amount and payable BIT and royalty amounts, the increased or reduced VAT, EIT and royalty amounts shall be distributed to the beneficiary localities on the principles specified in Clause 1, 2 or 3 of this Article.

5. Tax payment procedures:

Enterprises shall remit VAT, EIT and royalties into the budgets of localities in which they are headquartered (or make tax registration and declaration) and pay these taxes on behalf of their dependent units based in the localities which enjoy tax revenues.

Based on VAT, EIT and royalty amounts calculated and distributed to localities in which enterprises are headquartered (or make tax registration and declaration) and in localities which enjoy VAT, EIT and royalty revenues, shown in VAT, EIT and royalty returns and appendices No. 01-1/TD-GTGT, No. 02/TD-TNDN and No. 03-1/TD-TAIN, enterprises shall make documents for VAT, EIT and royalty payment to localities in which they are headquartered and each locality which enjoys VAT, EIT and royalty revenues. Such documents must indicate that taxes are remitted into state budget revenue accounts at state treasuries of the same level with tax agencies of localities in which enterprises are headquartered (or make tax registration and declaration) and localities which enjoy VAT, EIT and royalty revenues.

6. In case VAT, EIT and royalty amounts distributed by the hydropower generation establishment to localities are different, the provincial-level Tax Department of the locality in which the hydropower generation plant is located shall assume the prime responsibility for, and coordinate with the plant's investor and provincial-level Tax Departments of the localities in which the plant is located in, determining the plant's value of investment (turbines, hydropower dams and other major physical foundations), the area of the reservoir bed, funds for compensation for ground clearance and people relocation and resettlement, number of to-be-relocated households, and the value of compensation for material damage to the reservoir bed area in each province, and report thereon to the Ministry of Finance (the General Department of Taxation) before June 30 of a year preceding the year the plant is commissioned, in order to guide the rate of distribution of EIT, VAT and royalty amounts.

7. The determination of VAT, EIT and royalty revenues specified in Clauses 1, 2 and 3 of this Article applies to hydropower plants commissioned from January 1, 2011.

Article 21. Tax assessment in case taxpayers paying tax according to the declaration method violate tax laws

1. Tax agencies may assess payable tax amounts if taxpayers fall into the following cases:

a/ Failing to make tax registration under Article 22 of the Tax Administration Law;

b/ Failing to submit tax declaration dossiers within 10 (ten) days after the dossier submission deadline or the expiration of the extended time limit for dossier submission;

c/ Failing to supplement tax declaration dossiers at the request of tax administrations or inadequately, untruthfully or inaccurately providing tax bases for determination of payable tax amounts when supplementing the dossiers;

d/ Failing to produce accounting documents, invoices and documents related to determination of elements for use as tax bases upon expiration of the time limit for tax examination or inspection at taxpayers' offices;

e/ Tax examination or inspection shows that taxpayers improperly make cost accounting, or that figures in accounting books are inadequate, inaccurate or untruthful, resulting in failure to correctly determine elements for use as bases for calculation of payable tax amounts;

f/ Absconding or dispersing their assets for tax evasion;

g/ Having submitted tax declaration dossiers to tax administrations while unable to calculate by themselves payable tax amounts.

2. Assessment of each element related to the determination of payable tax amounts:

Taxpayers paying tax according to the declaration method will have each element related to the determination of payable tax amounts assessed in the following cases:

a/ Tax examination or inspection shows that taxpayers improperly make cost accounting, or that figures in accounting books are inadequate, inaccurate or untruthful, resulting in failure to correctly determine elements for use as bases for the calculation of payable tax amounts, unless they are subject to assessment of payable tax amounts.

b/ Examination of goods bought and sold shows that taxpayers make cost-accounting of the value of such goods not at normal market trading prices.

Normal market trading prices are trading prices objectively agreed between parties without associate relation.

Tax agencies may refer to goods and service prices publicized by state management agencies at the same time, or purchase and sale prices set by enterprises dealing in the same business lines or commodities, or sale prices set by enterprises dealing in the same commodities with large business scale and number of customers in localities, for determining normal trading prices as a basis for the assessment of sale and purchase prices and payable tax amounts.

3. For a number of business lines, when tax agencies detect, through examination, that accounting books, invoices and documents are inadequate, or detect violations of tax laws or irrationalities in tax declaration and payment, they shall assess the rate of added value or taxable income to turnover or assess taxable turnover or income. The assessment of turnover or income for determination of payable tax amounts is based on one criterion or some criteria such as house rent, wage, depreciation expense, material expense, etc. The Ministry of Finance shall specify such assessment for application to each business line and activity in each period.

4. Bases for tax assessment:

Tax agencies shall assess tax for taxpayers paying tax according to the declaration method that violate tax laws, based on one or all of the following grounds:

a/ Tax agencies' databases collected from:

- Taxpayers' declaration of turnover, expenses, incomes and payable tax amounts in previous tax declaration periods.

- Organizations and individuals related to taxpayers.

- Other state management agencies.

b/ Information on:

b.1/ Taxpayers that deal in the same commodities, business lines on the same scale in localities. In case of non-availability of information on taxpayers' commodities, business lines and scale in localities, relevant information on persons dealing in the same commodities, business lines and on the same scale in other localities will be used;

b.2/ The average payable tax amount of a number of business establishments dealing in the same business lines and commodities in the same localities. In case of non-availability of information on such business establishments, the average payable tax amount of business establishments dealing in the same business lines and commodities in other localities will be used.

c/ Documents and examination or inspection results which remain valid.

5. When making tax assessment, tax agencies shall send tax assessment decisions to taxpayers, made according to form No. 01/ADTH provided in this Circular.

6. The tax payment time limit is 10 days after tax agencies sign tax assessment decisions. In case a tax agency assesses a tax amount of VND 500 million or more, the tax payment time limit is 30 days after the tax agency signs a tax assessment decision.

After a tax agency signs a tax assessment decision, a taxpayer that submits tax declaration dossiers of a tax declaration period or time for which tax has been assessed shall still pay tax under such decision.

Tax amounts declared in dossiers of delayed tax payment declaration shall be recorded by tax agencies as amounts arising in such tax declaration period or time to serve as a basis for the determination of taxpayers' fulfillment of tax obligations. If not accepting the declared tax amounts, tax agencies shall issue written notices to taxpayers.

Taxpayers that disagree with tax amounts assessed by tax agencies shall still pay such tax amounts and may request tax agencies to give explanations or may lodge complaints about tax assessment.

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