Over the past period, the tax sector has continuously improved and supported businesses, households, and individuals in complying with tax laws, contributing to building a transparent and fair business environment.
However, some business owners, legal representatives, and individual business owners still do not fully understand the importance of complying with tax and invoice regulations. In fact, many even engage in deliberate tax evasion and tax arrears. This negatively impacts the tax system and leads to revenue losses for the State budget.
It is necessary to settle all outstanding tax obligations when ceasing business operations (the Tax Department has sent a warning letter).
Currently, many businesses, households, and individuals have ceased operations but have not fully fulfilled their tax obligations as required. According to the General Department of Taxation, some cases involve failure to complete the procedures for terminating the tax identification number, failure to notify the business registration authority or tax authority of the cessation of operations, or failure to operate at the registered address.
More seriously, some entities continue to generate revenue but fail to issue invoices, pay taxes, declare taxes, or declare insufficient amounts; they cease operations without notifying the business registration authority or the tax authority when they have outstanding tax debts, etc.
These actions constitute a serious violation. Tax management Law , and Enterprise LawThis is considered tax evasion or tax arrears.
📌 Pay attention to tax obligations after ceasing business operations or no longer operating at the registered address.
If your business is in this situation, take the following steps quickly:
→ Check legal status: Verify whether the business has submitted a notice of business cessation to the Department of Planning and Investment (DPI). If not, it needs to be done immediately.
→ Fulfill your tax obligations:
- Submit all outstanding tax returns (VAT, corporate income tax, personal income tax, etc.) up to the time of business cessation.
- Pay any taxes, penalties, and late payment fees (if applicable) as notified by the tax authority.
- If no revenue is generated, state this clearly in the tax return or explanatory letter sent to the tax authority.
→ Update your registration address: If a business is no longer operating at its old address, it needs to register the change of address with the Department of Planning and Investment and notify the tax authorities.
→ Working with the tax authorities:
- Submit a written explanation regarding the cessation of operations and a commitment to fulfill tax obligations.
- Request the tax authorities to check and confirm that you have no outstanding tax debts to avoid enforcement action.
📌 Pay attention to tax obligations after notifying the dissolution of the business.
→ Complete the dissolution procedures:
- Make sure you have submitted and approved the dissolution notice to the Department of Planning and Investment.
- Complete asset settlement, contract liquidation, and debt repayment (if any).
→ Fulfill your tax obligations:
- Submit the final tax returns (VAT, corporate income tax, personal income tax) up to the date of dissolution.
- Complete the corporate income tax and personal income tax settlement for the entire period of operation.
- Pay all taxes, penalties, and late payment fees as notified by the tax authorities.
→ Working with the tax authorities on dissolution:
- Submit tax return documents and a letter requesting confirmation of tax compliance.
- Prepare the necessary documents (accounting books, financial statements) for tax audit.
- Receive the tax audit report and the certificate confirming that you have no outstanding tax debts.
- Notification of dissolution results: After confirmation from the tax authority, submit the notification of completion of dissolution to the Department of Planning and Investment to remove the tax identification number and business registration.
Businesses face the risk of enforcement and heavy penalties if they fail to fulfill their tax obligations.
Failure to fulfill tax obligations after ceasing business operations, operating outside the registered address, or dissolving without completing tax obligations can lead to serious consequences for the business.
The tax authorities will apply coercive measures such as freezing bank accounts, preventing you from conducting financial transactions.
Additionally, you may be charged late payment penalties and other hefty administrative fines, increasing your financial burden.
More seriously, if the violations are prolonged, the business may face legal prosecution, significantly impacting its reputation and making it difficult to restore business operations or resolve legal issues later.
Coordinate and cooperate with tax authorities and fulfill all obligations.
In principle "Taxpayers declare their taxes themselves, pay their taxes themselves, and bear all responsibility."The tax authorities request that taxpayers cooperate in fulfilling the following requirements:
🚀 Individuals who are business owners, business representatives, individual business owners, or representatives of household businesses that have ceased operations but have not yet completed the procedures for terminating their tax identification numbers, as well as businesses, households, and individual business owners who have issued invoices and then abandoned their business address but have not yet declared taxes, have underdeclared taxes, or still owe taxes, should urgently contact the directly managing tax authority to fulfill their tax declaration and payment obligations to the state budget.
🚀 Actively cooperating with tax authorities to fulfill the aforementioned tax declaration and payment obligations serves as a basis for taxpayers to rectify and complete their obligations to the state budget, avoiding risks and potential legal action by competent state authorities.
If the tax authorities do not receive proactive cooperation from taxpayers, they will proceed to publicly disclose the list of taxpayer information as prescribed by law. Tax management LawSimultaneously, consolidate and complete the dossier to submit a request to the police for investigation, prosecution, and strict handling in accordance with the law.
To avoid severe penalties, contact your local tax authority immediately to settle any outstanding obligations. Access the General Department of Taxation's portal or contact the tax authority directly for detailed guidance. Compliance not only protects your business but also contributes to building a fair and transparent business environment.
Please refer to the Tax Department's Open Letter regarding the fulfillment of tax obligations for businesses, households, and individuals that have ceased operations but have not completed the procedures for terminating their tax identification numbers; and are not operating at their registered addresses, sent on April 11, 2025.
