Vietnam has issued Decree 34 extending the payment deadline for corporation tax, personal income tax, VAT and land rent for 2022. The decree is in effect until December 31 2022.
The government issued Executive Order 34 to help businesses and individuals recover from post-pandemic effects and business recovery. Vietnam Briefing describes tax incentives and how businesses can benefit from them.
To help business recovery, Vietnam issued Decree 34/2022/ND-CP on extending the deadline for corporate income tax (CIT), personal income tax (PIT ), value added tax (VAT), and land rental fees for 2022. Executive Order 34 applies to business activities that generated revenue in 2021 or 2022. The executive order came into effect on May 28 and is valid until December 31, 2022. Executive Order 34 is similar to last year’s Executive Order 52, which was directed at businesses affected by the pandemic.
The decree applies to businesses, individuals and business households (taxpayers). For VAT benefits, the decree applies to taxpayers who have production activities in agriculture, forestry and fishing, food, textiles, rubber, metal production, electronics, automotive, construction and wastewater treatment.
For the benefits of corporation tax and land rental charges, the decree applies to taxpayers of transportation, accommodation, food and beverage, education, labor, health care healthcare, computer programming, support industry products, credit institutions and foreign banks.
Eligible taxpayers benefit from a specific extension of tax payments, the details of which are as follows:
A downward deferral of VAT payment to eligible taxpayers for certain VAT reporting periods, including:
The deadline for payment of VAT and PIT for individuals and professional households such as SMEs is postponed to December 30, 2022.
CIT payments for Q1 and Q2 will be extended for three months. So, for example, the T1 CIT payment would be due by July 30, 2022. It should be noted that taxpayers should always consider the 75% rule when making interim CIT payments.
Land rental fees for taxpayers renting directly from the government have been extended for six months, from May 31 to November 30, 2022.
It is important to note that the tax deferral is not applied automatically, eligible taxpayers must instead prepare and submit a request for tax and ground rent deferral (electronically or by other methods) to the management tax authority for consideration.
This article was first published by VietnamBriefing which is produced by Dezan Shira & Associates. The firm assists foreign investors throughout Asia from its offices worldwideincluding in in China, hong kong, Vietnam, Singapore, Indiaand Russia. Readers can write to [email protected]