Tax finalization is a critical component of effective financial management for individuals, businesses, and national tax systems. Compliance with tax finalization regulations is mandatory for all individuals, organizations and enterprises. This is not only a legal task but also an important financial management tool to ensure legal compliance, tax optimization and effective business decision-making. Understanding the significance of this process, PHAM CONSULT would like to provide you with tax finalization support services, so that we can fulfill your tax finalization obligations in the most correct way and alleviate the burden of tax-related concerns on your behalf.
Tax Finalization
Although, until now, Vietnamese law has not had any direct concept of tax finalization. However, pursuant to Clause 10 Article 3 of the Law on Tax Administration 2019, there are provisions on tax finalization declaration as follows:
“10. Tax finalization declaration is the determination of the amount of tax payable in the tax year or the period from the beginning of the tax year to the termination of the operation arising from the tax liability or the time from the time it arises to the termination of the activity arising from the tax liability as prescribed by law.”
Through the above-mentioned provisions, we can explain that tax finalization is a process of calculating and declaring the amount of tax that individuals or enterprises need to fulfill their obligations to pay tax to tax authorities based on various factors including income, business transactions, and asset dealings within a specified accounting period.
Types Of Tax Finalization
All basic taxes such as value-added tax, corporate income tax, personal income tax … all must perform tax finalization. Accordingly:
Personal Income Tax
Personal income tax finalization is the process of calculating and determining the amount that an individual must pay or be reimbursed based on income earned in a calendar year.
Corporate Income Tax
The finalization of corporate income tax is a crucial aspect of accounting, wherein accountants calculate and declare revenues and earnings derived from enterprises’ production and sale of goods and services in accordance with legal requirements.
Value Added Tax
Value-added tax finalization is the process by which an enterprise calculates the amount of value-added tax payable or refunded in the tax period for each good and services.
Tax Finalization Declaration.
For the tax finalization declaration, it is necessary to comply properly and fully with the law to avoid unnecessary risks:
Tax Finalizations Return At The End Of The Year
Pursuant to Point b, Clause 3, Point 43 of the Law on Tax Administration 2019 specifies the tax finalization declaration dossier to be made at the end of 1 year, as follows:
Tax finalization declaration dossier in case of operation termination, contract termination, change of type of enterprise, enterprise reorganization
Pursuant to Clause 6, Article 43 of the Law on Tax Administration 2019 clearly stipulates tax finalization dossiers for cases of operation termination, contract termination, transformation of enterprise type, enterprise reorganization, specifically including:
Deadline For Submitting Tax Finalization Dossiers
The time limit for submitting tax finalization dossiers is also stipulated according to regulations of the Ministry of Finance and tax authorities. This period is usually adjusted each year and may vary depending on the type of tax and the type of taxpayer.
Accordingly, pursuant to Point a, Clause 2, Article 44 of the Law on Tax Administration 2019, for the time limit for filing tax returns for taxes with annual tax periods, it is stipulated no later than the last day of the 3rd month from the end of the calendar year or fiscal year for annual tax finalization dossiers; no later than the last day of the first month of the calendar year or fiscal year for annual tax returns.
So we can understand that the deadline for annual tax finalization will be at least on the last day of the 3rd month from the end of the calendar year or fiscal year. This means that if the business’s fiscal year ends on Dec. 31, the year’s tax finalization filings need to be filed by the last day of March of the following year.
Pursuant to Point b, Clause 2, Article 44 of the Law on Tax Administration, the deadline for submitting personal income tax finalization dossiers is at least the last day of the 4th month from the end of the calendar year for personal income tax finalization dossiers of individuals directly finalizing taxes.
The deadline for finalization and finalization of personal income tax in 2024 is as follows:
– If an individual with income from wages or wages authorizes tax finalization for organizations or individuals paying income, the tax finalization deadline is no later than March 31, 2024.
– If individuals with income from wages and wages directly finalize personal income tax with tax authorities, the tax finalization deadline is no later than April 30, 2024.
Regarding the time limit for finalizing corporate income tax, the current Law on Tax Administration specifically stipulates as follows:
– The latest tax payment deadline is the last day of the deadline for submitting the tax finalization declaration.
– Pursuant to Clause 3, Article 1 of Decree 91/2022/ND-CP, it is stipulated that:
If the total amount of corporate income tax temporarily paid in 04 quarters does not reach at least 80% of the amount of corporate income tax payable according to the annual settlement, and the taxpayer underpays the amount of tax that must be temporarily paid in 04 quarters. , then the late payment interest will be calculated on the underpaid tax amount.
The time for calculating late payment interest lasts from the day following the last day of the deadline for temporarily paying corporate income tax in the fourth quarter to the day immediately preceding the date of payment of the outstanding tax amount to the state budget.
Tax Finalization Support
PHAM CONSULT with many years of experience in the profession, has been supporting tax settlement for many customers, will provide you with professional and diversified services to support you in tax finalization:
Having professional support in tax finalization that PHAM CONSULT brings helps individuals and businesses ensure compliance with tax regulations and optimize tax costs.
If you have any legal questions that need to be answered, do not hesitate to contact PHAM CONSULT immediately at hotline +84932 103 118 to receive advice from specialists.
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