The company should pay attention to allocating PIT to branches, business locations, dependent units, etc. in other provinces when paying salaries and wages. In the following article, Pham Consult will tell you whether you need to re-finalize the PIT allocated to the non-province branch province or not!
1. The obligation to allocate personal income tax when having a branch outside the province
According to Article 12 of Circular 80/2021/TT-BTC, enterprises are obliged to allocate tax when doing centralized accounting with dependent units and business locations in other provinces where their head offices are located:
“1. Taxpayers operating and doing business in many other provincial-level localities where the taxpayer is headquartered shall conduct centralized accounting at the head office as prescribed in Clauses 2 and 4, Article 11 of Decree No. 126/ 2020/ND-CP performs tax declaration, tax calculation and submits tax declaration dossiers to tax authorities for direct management and allocates tax payable to each province where business is located.
2. Cases of allocation, methods of allocation, tax declaration, tax calculation and finalization for the allocated tax shall comply with the provisions of Articles 13, 14, 15, 16, 17, Article 18, Article 19 of this Circular.
2. Is it necessary to re-finalize the PIT amount allocated to the branch outside the province?
– According to the provisions of Point a, Clause 3, Article 19 of Circular 80/2021/TT-BTC, in case the Company pays salaries to employees of the Branch in the provinces subject to PIT allocation to each province according to guided in Clause 1, Article 19, the PIT amount is determined for each province on a monthly or quarterly basis corresponding to the Company’s PIT declaration period and does not have to be re-determined when finalizing tax.
– For employees who make their own PIT finalization, the finalization declaration dossier shall be submitted at the tax authority managing the unit where the family circumstance-based deduction has been registered according to Point b2 Clause 8 Article 11 of Decree 126/2020/NĐ-CP is as follows: Individuals who have calculated deductions for their family circumstances at any income-paying organization or individual shall submit a tax finalization declaration at the tax agency directly managing such income-paying organization or individual. . In case an individual changes his/her workplace and at an organization or individual paying the final income with family deductions, a tax finalization declaration shall be submitted to the tax authority managing the organization or individual. pay final income. In case the individual changes the place of work and at the organization or individual paying the final income without deduction for family circumstances, the tax finalization declaration dossier shall be submitted at the tax office where the individual resides. If the individual has not yet calculated the deduction for his/her family circumstances at any income-paying organization or individual, the tax finalization declaration shall be submitted at the tax office where the individual resides.
In case the resident does not sign a labor contract, or signs a labor contract of less than 3 months, or signs a service provision contract with income at one place or many places where 10% has been deducted, a dossier of declaration must be submitted. tax finalization at the tax office where the individual resides.
– In case the Company has a foreigner who is a resident individual and generates a salary paid from abroad, that person must submit a personal income tax return to the tax agency where the job is done in Vietnam. If the foreigner’s work place is not in Vietnam, he/she shall submit a tax return to the tax office where he/she resides (point a.2 clause 8 Article 11 of Decree 126/2020/NĐ-CP).
PHAM CONSULT is a unit specializing in providing tax consulting services, financial consulting, accounting services, preparing and paying salaries. Customers can contact us via hotline: (84-28) 3930 2487 or Facebook communication channel: http://bit.ly/phamconsult if you need support.