Amending regulations on temporary payment of 75% corporate income tax

VCN- The draft Decree supplementing a number of articles of Decree 126/2020/ND-CP stipulating a number of articles of the Law on Tax Administration and the Government’s Decree 123/2020/ND-CP revises regulations on temporary payment of 75% corporate income tax.
MoF to revise regulations on temporary payments of Corporate Income Tax MoF to revise regulations on temporary payments of Corporate Income Tax
More than 139,000 businesses and individuals have tax payment deadlines extended More than 139,000 businesses and individuals have tax payment deadlines extended
More policies, more support for people and enterprises More policies, more support for people and enterprises
Amending regulations on temporary payment of 75% corporate income tax

The temporarily paid tax amount of four quarters must be not lower than 80% of

payable amount according to the annual finalization.

Regulations on temporary payment need to be revised to facilitate enterprises

Through practical implementation, the requirement that businesses must estimate the tax payable for the whole year, while there are still two months left, is not reasonable, and does not help taxpayers.

Therefore, the Ministry of Finance proposes to amend the regulations on temporary payment of quarterly corporate income tax in Point b, Clause 6, Article 8 of Decree 126/2020/ND-CP; and revise the regulations in points c and g, clause 6, Article 8 of Decree 126 on temporary payment of remaining after-tax profits after making provisional funds of state-owned enterprises holding 100% of charter capital, and temporary payment of quarterly corporate income of foreign transport companies.

Point b, Clause 6, Article 8 of Decree 126/2020/ND-CP stipulates that taxpayers must temporarily pay corporate income tax of the first three quarters, which are not less than 75% of corporate income tax payable under the annual tax finalization. If the total temporary payment is less than 75% of the tax payable for the whole year, the taxpayer will pay late payment interest for a tax amount lower than 75%.

To implement the regulations, the taxpayer needs to estimate the payable corporate income tax amount of the whole year as a basis to determine the temporary payment of the first three quarters at the deadline for payment of the third quarter.

In addition, Point C, Article 8 of Decree 126 stipulates that if the Joint Stock Company or Limited Liability Company fails to distribute dividends or profits, the parent company must notify the Ministry of Finance and the parent company’s governing body.

The time limit for dividend and profit distribution prescribed in the Law on Enterprises is that the dividend of the joint-stock company must be paid within six months from the end of the annual general meeting of shareholders. The profit of a limited liability company with two or more members must only be distributed to members after the company has fulfilled their tax and other financial obligations and paid all debts and other property obligations. Therefore, the draft decree also stipulates that the taxpayer must comply with the provisions of the Enterprise Law.

The temporarily paid tax amount of 4 quarters must not be lower than 80% of the payable amount under the annual tax finalization

The draft Decree amends Point b, Clause 6, Article 8 of Decree 126/2020/ND-CP. Accordingly, the taxpayer must determine by themselves the amount of quarterly corporate income tax and is deducted from the payable amount according to the annual tax finalization.

The taxpayer subject to making quarterly financial statements will base on the quarterly financial statement and the provisions of the tax law to determine the quarterly temporary payment.

The draft specifies that the taxpayer subject to making quarterly financial statements will base on the quarterly production and business results and the provisions of tax law to determine the quarterly temporary payment.

The total amount of the tax for four quarters must not be less than 80% of the payable corporate income tax amount under the annual finalization. If the taxpayer pays less than the amount of tax payable, they must pay late payment interest calculated on the underpaid tax amount from the day following the last day of the temporary payment deadline to the payment deadline of the unpaid amount.

In case the taxpayer executes a project of investment in infrastructure or housing for transfer or lease purchase and collects progress payments from customers, provisional corporate income tax shall be paid quarterly at the rate of 1% of the amount collected. In case the project is yet to be transferred and not included in the revenue subject to corporate income tax in the year, it shall be included in the tax finalization dossier when the project is partially or fully transferred instead of the annual tax finalization dossier.

By Thuy Linh/Ngoc Loan

Related News

Abolishing regulations on tax exemption for small-value imported goods must comply with international practices

Abolishing regulations on tax exemption for small-value imported goods must comply with international practices

VCN - The Ministry of Finance said that the abolition of regulations on tax exemption for imported goods valued at less than VND1 million must comply with international practices in the context of the growing trend of cross-border e-commerce activities.
Deputy Prime Minister, Minister of Finance: Budget management to be more decentralized

Deputy Prime Minister, Minister of Finance: Budget management to be more decentralized

VCN - Deputy Prime Minister, Minister of Finance Ho Duc Phoc indicated that the revision of the State Budget Law (SBL), as part of the "One Law Amending Seven Laws" scheme, focuses on removing short-term bottlenecks and obstacles. He also announced that future amendments will increase decentralization and delegation of authority in budget management.
Ensure harmony of interests of “3 parties” when applying 5% VAT on fertilizers

Ensure harmony of interests of “3 parties” when applying 5% VAT on fertilizers

VCN - In the short term, applying 5% VAT on fertilizers may increase selling prices, but in the long term, farmers will benefit from this policy. When the fertilizer manufacture is deducted input tax, it will help reduce investment cost and production cost.
Businesses can choose a suitable electronic invoice model generated from the cash register

Businesses can choose a suitable electronic invoice model generated from the cash register

VCN - The Ministry of Finance said that individual business households can choose a suitable model to apply electronic invoice solutions from cash registers, depending on the number of invoices used in the year, in the month and the current status of software solutions and technical infrastructure.

Latest News

Hanoi Customs resolves tax policy queries for enterprises

Hanoi Customs resolves tax policy queries for enterprises

VCN - Queries regarding customs consultation procedures and tax refunds due to price reduction clauses were addressed by the Hanoi Customs Department, providing clarity for businesses.
Regularly check tax obligations to avoid temporary exit suspension

Regularly check tax obligations to avoid temporary exit suspension

VCN - In order to avoid the situation of arriving at the airport or border gate and only finding out that you owe taxes and being temporarily suspended from leaving the country by the Tax Authority, the Tax Authority recommends that taxpayers regularly look up their tax obligations to have a plan to pay taxes on time, not letting the tax debt situation drag on and drag on.
Implementing the SAFE framework in Vietnam: Assessment through the lens of international standards

Implementing the SAFE framework in Vietnam: Assessment through the lens of international standards

VCN - In June 2005, the World Customs Organization (WCO) developed and adopted the SAFE Framework of Standards to Secure and Facilitate Global Trade. The SAFE Framework plays a crucial role in encouraging countries to modernize, enhance security, and facilitate trade within global supply chain management and Authorized Economic Operator (AEO) programs. This approach introduces a comprehensive method for cross-border goods management and promotes closer cooperation between Customs, businesses, and stakeholders. The Customs News presents a two-part series on implementing the SAFE Framework in Vietnam.
Proposing the Tax Authority be flexible in applying tax debt enforcement measures simultaneously

Proposing the Tax Authority be flexible in applying tax debt enforcement measures simultaneously

VCN - In the draft revised Law on Tax Administration, the Ministry of Finance proposed amending regulations on measures to enforce administrative decisions on tax administration to remove obstacles in policy mechanism and improve the effectiveness of tax administration.

More News

Many shortcomings in process and manual book on handling administrative violations

Many shortcomings in process and manual book on handling administrative violations

VCN - Legal policies on handling administrative violations have effectively supported the technical work of the Customs sector. However, some legal bases and regulations have been amended, replaced, and supplemented, which have limited the efficiency of handling administrative violations of the customs sector.
Implementing the SAFE Framework in Vietnam: Lessons from practice

Implementing the SAFE Framework in Vietnam: Lessons from practice

VCN - The Framework of Standards to Secure and Facilitate Global Trade (SAFE Framework) is a strategic international instrument introduced by the World Customs Organization (WCO) to enhance security and trade facilitation in global supply chains. It contributes significantly to the economic development of the 21st century.
Implementing the SAFE Framework in Vietnam: Solutions and Recommendations

Implementing the SAFE Framework in Vietnam: Solutions and Recommendations

VCN - Recognizing the significance, impact, and benefits of the SAFE Framework in customs modernization and reform, Vietnam Customs is advancing the implementation of SAFE. This involves both capacity building and phased deployment aligned with Vietnam Customs’ development strategy and practical needs.
Policy adaptation and acceleration of digital transformation in tax and customs management

Policy adaptation and acceleration of digital transformation in tax and customs management

VCN - In order to contribute to economic growth, tax, customs and logistics management policies need to ensure high adaptability, stability and predictability so that they require little amendment or supplementation.
Implement regulations on special preferential import tariffs under VIFTA

Implement regulations on special preferential import tariffs under VIFTA

VCN - The General Department of Vietnam Customs (GDVC) requests provincial and municipal customs departments to implement Vietnam's special preferential import tariffs under the Free Trade Agreement between the Government of the Socialist Republic of Vietnam and the Government of the State of Israel for the period 2024-2027 (referred to as the VIFTA) from October 15, 2024.
Perfecting tax policy for goods traded via e-commerce

Perfecting tax policy for goods traded via e-commerce

VCN - In order to ensure the goal of developing e-commerce activities without causing loss of state budget revenue, the Customs authority is actively coordinating with policy advisory units of the Ministry of Finance to research and review regulations on tax exemption for import and export goods transacted via e-commerce.
Are belongings of foreigners on business trip to Vietnam exempt from tax?

Are belongings of foreigners on business trip to Vietnam exempt from tax?

VCN - That is the question of Nhat Viet Relocation Company Limited, which has just been answered by the Customs Department and given specific instructions on providing a confirmation of residence of foreigners on business trip to Vietnam to follow tax exemption procedures for movable assets.
Amending regulations on enforcement measures in tax administration

Amending regulations on enforcement measures in tax administration

VCN - In draft of 1 law amending 7 laws in the financial sector, the Ministry of Finance proposed to amend the regulations on enforcement measures in tax administration in the Law on Tax Administration.
Customs procedures for import and export goods during system disruptions

Customs procedures for import and export goods during system disruptions

VCN - When the electronic customs data processing system experiences a disruption, customs procedures for export and import goods, goods under customs supervision, and goods sent via express delivery will follow a separate set of procedures.
Read More

Your care

Latest Most read
Hanoi Customs resolves tax policy queries for enterprises

Hanoi Customs resolves tax policy queries for enterprises

Queries regarding customs consultation procedures and tax refunds due to price reduction clauses were addressed by the Hanoi Customs Department, providing clarity for businesses.
Regularly check tax obligations to avoid temporary exit suspension

Regularly check tax obligations to avoid temporary exit suspension

Tax Authority recommends that taxpayers regularly look up their tax obligations to have a plan to pay taxes on time, not letting the tax debt situation drag on and drag on.
Implementing the SAFE framework in Vietnam: Assessment through the lens of international standards

Implementing the SAFE framework in Vietnam: Assessment through the lens of international standards

The SAFE Framework plays a crucial role in encouraging countries to modernize, enhance security, and facilitate trade within global supply chain management and Authorized Economic Operator (AEO) programs
Proposing the Tax Authority be flexible in applying tax debt enforcement measures simultaneously

Proposing the Tax Authority be flexible in applying tax debt enforcement measures simultaneously

VCN - In the draft revised Law on Tax Administration, the Ministry of Finance proposed amending regulations on measures to enforce administrative decisions on tax administration to remove obstacles in policy mechanism and improve the effectiveness of tax
Many shortcomings in process and manual book on handling administrative violations

Many shortcomings in process and manual book on handling administrative violations

VCN - Legal policies on handling administrative violations have effectively supported the technical work of the Customs sector. However, some legal bases and regulations have been amended, replaced, and supplemented, which have limited the efficiency of h
Mobile Version