VI How much business household revenue must pay tax? If business households pay tax by declaration method, do they need to implement accounting system? In which cases must business households use electronic invoices with tax authority codes when selling goods and providing services? Through today’s article, let’s find out about this issue with Pham Consult!
How much business household revenue must pay tax?
Pursuant to Clause 2, Article 4 of Circular 40/2021/TT-BTC, the following provisions are provided:
Tax calculation principles
1. Tax calculation principles for business households and business individuals shall be implemented in accordance with the provisions of current laws on VAT, personal income tax and relevant legal documents.
2. Business households and business individuals with revenue from production and business activities in the calendar year of VND 100 million or less shall not be required to pay VAT and personal income tax according to the provisions of law on VAT and personal income tax. Business households and business individuals shall be responsible for declaring taxes accurately, honestly and completely and submitting tax dossiers on time; and shall be responsible before the law for the accuracy, honesty and completeness of tax dossiers according to regulations.
3. For business households and individuals doing business in the form of groups of individuals or households, the revenue level of VND 100 million/year or less to determine individuals not having to pay VAT or personal income tax is determined for one (01) sole representative of the group of individuals or households in the tax year.
According to the above regulations, business households and individuals with revenue from production and business activities in the calendar year of VND 100 million or less are not required to pay VAT or personal income tax according to the law on VAT and personal income tax.
Thus, current law stipulates that if the business household’s revenue is over VND 100 million/year, it must pay VAT and personal income tax.
Do business households that pay taxes by the declaration method need to implement the accounting regime?
Pursuant to Article 5 of Circular 40/2021/TT-BTC, the method of calculating tax for business households and business individuals paying tax by the declaration method is as follows:
Tax calculation method for business households and business individuals paying tax by the declaration method
1. The declaration method applies to large-scale business households and business individuals; and business households and business individuals that have not yet met the large scale requirements but choose to pay tax by the declaration method.
2. Business households and business individuals paying tax by the declaration method shall declare tax monthly, except for cases where business households and business individuals have just started their business and business households and business individuals that meet the criteria for quarterly tax declaration and choose to declare tax quarterly according to the provisions of Article 9 of Decree No. 126/2020/ND-CP dated October 19, 2020 of the Government.
3. If a business household or individual paying tax by the declaration method determines that the taxable revenue is not consistent with reality, the tax authority shall determine the taxable revenue in accordance with the provisions of Article 50 of the Law on Tax Administration.
4. A business household or individual paying tax by the declaration method must implement the accounting, invoice and voucher regime. In cases where a business household or individual is operating in a field or industry with a basis for determining revenue as confirmed by a competent authority, the accounting regime shall not be required.
5. A business household or individual paying tax by the declaration method shall not be required to make tax finalization.
Accordingly, in cases where a business household pays tax by the declaration method, the accounting, invoice and voucher regime shall be required.
However, if a business household is operating in a field or industry with a basis for determining revenue as confirmed by a competent authority, the accounting regime shall not be required.
In which cases must business households use electronic invoices with tax authority codes when selling goods and providing services?
Pursuant to Clause 3, Article 91 of the 2019 Tax Administration Law, the application of electronic invoices when selling goods and providing services is stipulated as follows:
Applying electronic invoices when selling goods and providing services
…
3. Business households and business individuals falling under the cases stipulated in Clause 5, Article 51 of this Law and cases where revenue can be determined when selling goods and services use electronic invoices with tax authority codes when selling goods and providing services.
…
At the same time, pursuant to Clause 5, Article 51 of the 2019 Tax Administration Law, it is stipulated as follows:
Determining tax rates for business households and business individuals paying taxes according to the lump-sum tax method
…
4. The Minister of Finance shall detail the basis and procedures for determining lump-sum tax rates for business households and business individuals.
5. Business households and business individuals whose revenue and labor scale meet the highest level of criteria for micro-enterprises according to the law on supporting small and medium-sized enterprises must implement the accounting regime and pay taxes according to the declaration method.
Thus, according to the regulations, business households must use electronic invoices with tax authority codes when selling goods and providing services in the following cases:
– Business households whose revenue and labor scale meet the highest level of criteria for micro-enterprises according to the law on supporting small and medium-sized enterprises;
– Cases where revenue can be determined when selling goods and services.
Comments
