CIT finalization – Regulations, notes and declaration forms

Submitting corporate income tax finalization documents to the directly managing tax agency is a task that any business must comply with after the end of the fiscal year. Below are notes that business accountants need to know to limit errors when submitting Corporate Income Tax (CIT) finalization documents.

1. Overview of corporate income tax finalization

1.1. What is a CIT settlement?

Corporate Income Tax declaration (CIT) is a job that businesses are required to do at the end of the calendar year or fiscal year. Every quarter, businesses must temporarily pay CIT for that quarter and at the end of the year must make tax finalization according to regulations.

1.2. Subjects needing corporate income tax finalization

According to Article 3 of the 2008 Corporate Income Tax Law, enterprises with taxable income specified in Article 3 of the Law must pay corporate income tax including:

  • Enterprises established under the provisions of Vietnamese law pay tax on taxable income arising in Vietnam and taxable income arising outside Vietnam;
  • Foreign enterprises with permanent establishments in Vietnam pay tax on taxable income arising in Vietnam and taxable income arising outside Vietnam related to the operations of that permanent establishment;
  • oreign enterprises with permanent establishments in Vietnam pay tax on taxable income arising in Vietnam that is not related to the operations of the permanent establishment;
  • Foreign enterprises that do not have a permanent establishment in Vietnam pay tax on taxable income arising in Vietnam.
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Notes on 2024 CIT Corporate Income Tax declaration

2. Regulations on Corporate Income Tax payment

2.1. Regulations on time of Corporate Income Tax payment

Based on Point b, Clause 3, Article 43 and Point a, Clause 2, Article 44 of Tax Administration Law No. 38/2019/QH14 and Article 12, Accounting Law No. 88/2015/QH13 above, the deadline for submitting tax finalization declaration documents CIT in 2023 for tax authorities is as follows:

For enterprises whose fiscal year coincides with the calendar year, the deadline for submitting the annual reports for the fiscal year ending on December 31, 2023, is April 1, 2024.

For enterprises with a fiscal year different from the calendar year, the deadlines are as follows:

  • For the fiscal year ending on March 31, 2024, the deadline is July 1, 2024.
  • For the fiscal year ending on June 30, 2024, the deadline is September 30, 2024.
  • For the fiscal year ending on September 30, 2024, the deadline is December 31, 2024.

(*) According to Article 86 of Circular No. 80/2021/TT-BTC dated September 29, 2021 of the Ministry of Finance, in case the tax declaration submission deadline coincides with a prescribed holiday, the tax declaration submission deadline is Tax is calculated on the next working day of that holiday according to the provisions of the Civil Code. Because the last days of quarter 1/2024 and quarter 2/2024 are Sundays (holidays), the tax declaration submission deadline is postponed to the next working day, corresponding to Monday, April 1. /2024 and Monday, July 1, 2024 as shown in the table above.

2.2. Regulations on fines for late payment and failure to submit tax finalization documents

According to Article 13 of Decree No. 125/2020/ND-CP, penalties for late submission of Corporate Income Tax payment documents are specified as follows:

2.2.1. Submitting Tax Declaration 1 to 5 Days Late with Extenuating Circumstances:

  • Penalty Level: Caution

2.2.2. Submitting Tax Declaration 1 to 30 Days Late:

  • Penalty Level: Fine from 2,000,000 VND to 5,000,000 VND

Note: This does not apply to cases with extenuating circumstances as mentioned above.

2.2.3. Submitting Tax Declaration 31 to 60 Days Late:

  • Penalty Level: Fine from 5,000,000 VND to 8,000,000 VND

2.3.4. Submitting Tax Declaration 61 to 90 Days Late or Other Specific Cases:

a. Submitting tax declaration documents 61 to 90 days late.
b. Submitting a tax declaration 91 days or more late without incurring any tax payable.
c. Failure to submit a tax declaration when no tax is payable.
d. Failure to submit appendices as required for enterprises with associated transactions along with corporate income tax finalization dossiers.

  • Penalty Level: Fine from 8,000,000 VND to 15,000,000 VND

2.3.5. Submitting a Tax Return More than 90 Days Late with Tax Payable:

  • Conditions: This applies if the taxpayer has paid the full tax amount and late payment interest before the tax authority announces the tax audit or tax inspection decision, or before the tax authority records the late submission.
  • Penalty Level: Fine from 15,000,000 VND to 25,000,000 VND
  • Note: If the fine exceeds the tax amount on the declaration, the maximum fine will equal the tax payable but not lower than the average fine specified in the previous case.

 


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2.3 Remedial measures

  • Forced to pay the full amount of late tax payment to the state budget for violations specified in cases 1, 2, 3, 4 and 5 in the table above in case the taxpayer is late in submitting documents. Tax declaration leads to late tax payment;
  • Forced submission of tax declaration dossiers and appendices attached to tax declaration dossiers for the acts specified in points c and d of case 4 in the table above.

Thus, in this article S4B Vietnam has gathered some key notes for 2024 corporate income tax finalization for businesses. Accountants need to master it to ensure businesses fully comply with tax laws. Nowadays, accounting services have been created to help accountants a lot in carrying out work activities and shorten the time to perform manual tasks and invest more in important tasks. If you need support in accounting and Corporate Income Tax declaration, please contact us.

S4B Vietnam

  • Address: Unit 602A, Tower A, Handi Resco Office Building. 521 Kim Ma Street, Ba Dinh District, Hanoi
  • Tel: + 84 24 3974 4181
  • Email: service@s4b.com.vn

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