Tax Alert - Decree 41 on extension of deadline for tax payment

On 08th April 2020, the Government had released Decree 41/2020/ND-CP on extending the deadline of tax and land rental fee payment for the enterprises, individuals and business households (“Tax payers”) that are affected by COVID-19.

Decree 41/2020/ND-CP provides notable points as below:

1. Tax payers who subject to the extended deadline for tax and land rental fee payment shall include:

  • Tax payers which have production activities in the industry of agriculture, forestry and aquaculture; food production and processing; textile; costume production; production of leather and related products; production of wood and of products of wood and cork, except for furniture; production of products of straw and plaiting materials; production of paper and paper products; production of rubber and plastics products; production of other non-metallic mineral products; production of basic metals; machining; treatment and coating of metals; manufacturing of electronic products, computer and optical products; manufacturing automobiles and other motor vehicle; production of furniture; construction;
  • Tax payers which have business activities of transportation and storage; accommodation and catering services; education and training; health services and social support services; real estate activities; labour service and employment activities; travel agency, tour operator and support services related to advertising and organizing tours; art, entertainment and creation; libraries, archives, museum, and other cultural activities; sport, recreation; cinema;
  • Tax payers which manufacture products belonged to the list of prioritized supporting industries; manufacturing of key mechanical products;
  • Small and micro enterprises; and
  • Credit institutions and branches of foreign banks which provide supports to their customers in accordance with the instruction of State Bank of Vietnam during the COVID-19 epidemic.

2. The deadline for tax and land rental fee payment shall be extended as below:

  • Value Added Tax (“VAT”) obligation for the period from March to June 2020 or Quarter I and II/2020 shall be extended to 05 months;
  • The deadline for settling Corporate Income Tax (“CIT”) obligation for fiscal year 2019 (“FY19”) and provisional CIT of Quarter I and II/2020 shall be extended to 05 months from the statutory deadline. In case the enterprises already settled the CIT obligation of FY19, the Tax payers are allowed to offset with other taxes obligation;
  • The deadline for settling VAT and Personal Income Tax (“PIT”) obligations of individuals or household businesses for 2019 shall be no later than 31st December 2020; and
  • The deadline for settling land rental fee obligation in the first period of 2020 shall be extended for 05 months from 31st May 2020.

3. Registration procedures

  • Tax payers must submit the application with provided form enclosed in this Decree to the direct managing tax authority together with the submission of tax declaration form no later than 30 July 2020;
  • The tax authority will only respond in case the Tax payers do not qualify for the extension of tax payment.

OUR SUPPORT

We do trust the above points are notable and sufficient, but should you have any questions or need a deeper discussion on this issue, please do not hesitate to contact us.

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