DISSOLVED ENTERPRISES SHALL BE ELIMINATED TAX DEBT IF THEY LOST THEIR ABILITY TO PAY THE STATE BUDGET
Since July 15th, 2020, the Ministry of Finance promulgated Circular No. 69/2020/TT-BTC on applications and procedures for debt settlement according to Resolution No. 94/2019/QH14 which stipulates tax debt relief and cancellation of late payment fines and interest for insolvent taxpayers. It is made on the basis of the provisions of the Law on tax administration, satisfying regulations of bankruptcy, enterprises and banks. Moreover, it has to ensure the feasibility of the legal practice, being consistent with the reality of socio-economic life. Circular No. 69/2020/TT-BTC comes into force from July 01st, 2020 and is implemented within 03 years from its effective date.
1. Entities eligible for debt settlement
Entities eligible for debt settlement have to satisfy two criterions as follows:
- A taxpayer is unable to pay outstanding tax, late payment interest or fine that is incurred before July 1st, 2020.
- The taxpayer submits a dissolution decision to the tax authority or business registration authority, the business registration authority has posted a notice on the national business registration portal but the taxpayer has not completed the dissolution procedures.
2. Debt settlement measures
- Tax chargeoff;
- Cancellation of tax, late payment interest and fines.
3. Tax chargeoff
- The criterions of tax chargeoff
- The tax chargeoff is applied since July 1st, 2020. The chargeoff date is the day on which the business registration authority posts the notice on the national business registration portal.
- The conditions of tax chargeoff: The taxpayer has a dissolution decision or a notice issued by the business registration authority. The content of this notice is that the taxpayer has not completed the dissolution procedures.
- The dossier of tax chargeoff
- The information of taxpayers’ name and tax identification number; the time for posting a notice that taxpayers are undergoing the procedure of dissolution on the national business registration portal; the tax authority’s notice which the taxpayer’s business operation is suspended and the taxpayer is carrying out the procedure for TIN deactivation; The business registration authority, the competent authority granting practice certificates issue notification of the status of the enterprise undergoing dissolution process (the original or copies cum signature and stamp of tax authorities);
- Dissolution decision or written notice of dissolution;
- Notification of tax debts, fines and late payment or written confirmation of the tax amount, taxpayer’s fines and late payment which are calculated to June 30th, 2020.
- Publishing tax chargeoff
- The debt management department or the department assigned debt settlement shall enter the tax chargeoff decision on tax administration application within 5 (five) working days since the day that the tax chargeoff decision is issued.
- In no later than 5 working days starting from the date tax chargeoff decision is issued, Departments of Taxation, Departments of Customs, Post Clearance Audit Departments post the tax chargeoff decision on websites of Departments of Taxation, Departments of Customs, General Department of Vietnam Customs.
4. Cancellation of tax, late payment interest and fines
- The criterions of cancellation of tax, late payment interest and fines
- Cancellation of late payment fines and interest accrued by July 01st, 2020 for insolvent taxpayers.
- Conditioms of cancellation of tax, late payment interest and fine: the taxpayer has a dissolution decision or a notice received from business registration authority regarding completion of the dissolution procedures on the national business registration portal must be provided.
- The dossier of cancellation of tax, late payment interest and fines
- The written request for tax debt cancellation prepared by the supervisory tax authority;
- Documents which are requested in the dossier of tax chargeoff;
- The written certification with content that the taxpayer does not carry out business activities at the registered address is issued by the People’s Committee of the commune where taxpayers registered operating activities address.
- If taxpayers are the branch, affiliated unit, representative office, business locations, their dossiers must include written certifications of the People’s Committee of the commune where taxpayers registered operating activities address. The content of the certification is that the taxpayer does not carry out business activities at the registered address or taxpayer received tax debt relief decisions of headquarter.
- The method of the taxpayer’s debt settlement at the time when the dissolution decision is issued.
- The document which publishes the list of taxpayers proposed cancellation of tax.
- Publishing cancellation of tax, late payment interest and fines
- In no later than 5 (five) working dáy starting the date from tax debt relief decisions issued, the tax administration authorities publish tax debt relief decisions in their website as follows:
- In case of tax cancellation under the competence of the chairperson of a provincial-level People’s Committee, the tax debt relief decisions are posted on the website of Departments of Taxation, Departments of Customs, General Department of Vietnam Customs.
- In case of tax cancellation under the competence of The Director of the General Department of Taxation, The Director of the General Department of Customs, the Minister of Finance, the Prime Minister, the tax debt relief decisions are posted in the website of General Department of Taxation, Departments of Taxation, General Department of Vietnam Customs, Departments of Customs.
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