13 cases subject to direct tax registration with Tax authority

Amending regulations on tax registration and e-tax transactions

Taxpayer directly implements tax registration with Tax man. Illustrative photo: Internet

Taxpayers subject to direct tax registration with tax authority

The draft Circular stipulates taxpayers subject to direct tax registration with tax authorities; tax code structure; Tax registration documents, procedures, and forms for cases including: first-time tax registration; issuance of tax registration certificates and tax code notifications; Notice of change in tax registration information; notice of temporary suspension of operations and business; invalidate tax code; restoring tax code; Tax registration for reorganized enterprises as per the provisions of the Law on Tax Administration No. 38/2019/QH14.

Notably, Article 4 of the draft Circular stipulates that taxpayers subject to direct tax registration with tax authorities include: taxpayers subject to tax registration through the interconnected single-window mechanism; Taxpayers subject to direct tax registration with tax authority.

13 cases subject to direct tax registration with Tax authority as enterprises operating in the fields of insurance, accounting, and auditing, lawyers, notaries or other specialized fields are not required to register their businesses through the business registration agency; representative offices of foreign organizations to Vietnam; foreign organizations and individuals and organizations in Vietnam using humanitarian aid or foreign non-refundable aid to purchase goods and services with VAT in Vietnam, and ODA project owners eligible for VAT refund, ODA project sponsor representative office; foreign organizations without legal status to Vietnam, foreign individuals independently practicing business in Vietnam with income arising in Vietnam or tax obligations arising in Vietnam (referred to as foreign contractors and foreign subcontractors); overseas suppliers that are organizations that do not have permanent establishment in Vietnam or non-resident individuals doing e-commerce business, digital-based business activities; individuals whose income is subject to personal income tax; the dependent; organizations and individuals authorized by tax authorities for collection.

In addition, the provisions of Clause 3, Article 5 provide that personal identification numbers will be used instead of tax codes of taxpayers who are individuals and dependents. At the same time, the personal identification number of the household representative, business household representative, or business individual is also used instead of their tax codes.

Applying the National Population Database in implementing tax registration procedures

The Draft Circular also provides the application of the National Database on population, identification and electronic authentication in implementing tax registration procedures. Accordingly, the Tax authority exploits personal information in the National population database in line with the roadmap to connect and share information between the National population database and the tax database to process registration procedures for tax payers, and must store information and data to ensure safety and security. If the information already exists in the National population database and has been connected and shared with the tax database, the taxpayer is not required to re-declare to the tax authority.

If an individual has registered and activated an electronic identification account at level 2, and the electronic identification and authentication system and the Portal of the General Department of Taxation have been connected and operated, the individual is allowed to use e-identification account at level 2 to conduct tax registration procedures with the tax authority without having to submit a copy of the passport in the tax registration dossier as prescribed in Clause 2, Article 22, Clause 1, Article 25 of the draft Circular if it has been integrated into the electronic identity account.

The Draft Circular also states that if the National Population Database proactively transmits information to the Tax Database when issuing personal identification numbers, the Tax authority will immediately update the personal identification number into the Tax registration system to use as a tax code for an individual and will not require the individual to carry out tax registration procedures as prescribed in Points b, c, d, Clause 1, Article 22 of this Circular.

Also according to the draft Circular, the Tax authority will process tax registration procedures for taxpayers under the backup process in the following cases: tax registration application system or Tax Registration System or National Population Database System have erros or other force.

Based on the expected time to fix the erro in the Tax Registration System or the National Population Database System, the General Department of Taxation will notify in advance the expected time for the Tax authority to process the procedures for taxpayers.

The procedures for taxpayers under the backup process is carried out paper documents. Within 30 days from the date of receiving notice from the General Department of Taxation that the tax registration system has completed erro, the Tax agency must update and supplement resolved data and information for taxpayers.