Circular 40/2021/TT-BTC regulates taxes for business households and individual businesses.

CIRCULARS

GUIDELINES ON VALUE ADDED TAX, PERSONAL INCOME TAX, AND TAX MANAGEMENT FOR HOUSEHOLD BUSINESSES AND INDIVIDUAL BUSINESSES

Based on the Law on Personal Income Tax dated November 21, 2007; and the Law amending and supplementing a number of articles of the Law on Personal Income Tax dated November 22, 2012;

Based on the Value Added Tax Law dated June 3, 2008; and the Law amending and supplementing a number of articles of the Value Added Tax Law dated June 19, 2013;

Based on the Law amending and supplementing a number of articles of the Laws on taxation dated November 26, 2014;

Based on the Law on Tax Administration dated June 13, 2019;

Based on Decree No. 209/2013/ND-CP dated December 18, 2013 of the Government detailing and guiding the implementation of a number of articles of the Law on Value Added Tax;

Based on Decree No. 12/2015/ND-CP dated February 12, 2015 of the Government detailing the implementation of the Law amending and supplementing a number of articles of the Laws on taxation and amending and supplementing a number of articles of the Decrees on taxation;

Based on Decree No. 126/2020/ND-CP dated October 19, 2020 of the Government detailing a number of articles of the Law on Tax Administration;

Based on Government Decree No. 87/2017/ND-CP dated July 26, 2017, regulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

As requested by the Director General of the General Department of Taxation;

The Minister of Finance has issued a Circular guiding value-added tax, personal income tax, and tax management for business households and individual businesses as follows:

Chapter I

GENERAL PROVISIONS

Article 1. Scope

This circular provides guidance on value-added tax (VAT), personal income tax (PIT), and tax management for business households and individual businesses.

Article 2. Subject of application

1. Household businesses and individual businesses are resident individuals engaged in the production and sale of goods and services in all fields and sectors of production and business as prescribed by law, including some of the following cases:

a) To practice independently in fields and professions for which licenses or professional certificates are required by law;

b) The practice of selling at the correct price for lottery agents, insurance agents, and multi-level marketing agents who are individuals directly contracting with lottery companies, insurance companies, or multi-level marketing companies;

c) Business cooperation with organizations;

d) Agricultural, forestry, salt production, aquaculture, and fisheries production and business activities that do not meet the conditions for tax exemption as prescribed by the law on VAT and personal income tax;

d) E-commerce activities, including cases where individuals earn income from products, services, and digital information content as regulated by the law on e-commerce.

2. Household businesses and individual businesses engaged in production and business activities at border markets, border gate markets, and markets within border economic zones on the territory of Vietnam;

3. Individuals who rent out property;

4. Individuals transferring Vietnamese national internet domain names “.vn”;

5. Organizing business cooperation with individuals;

6. Organizations and individuals filing tax returns and paying taxes on behalf of individuals;

7. Lottery companies, insurance companies, and multi-level marketing companies pay income to individuals who directly sign agency contracts to sell lottery tickets, insurance products, and multi-level marketing products at the correct price;

8. Tax authorities, state agencies, organizations, and other relevant individuals.

Article 3. Explain words

In addition to the terms already explained in the Law on Tax Administration, tax laws, and related decrees, some other terms in this Circular are understood as follows:

1. A "household business" is a production and business establishment registered by an individual or members of a household, who are liable for the household's business activities with all their assets, as stipulated in Article 79 of Government Decree No. 01/2021/ND-CP dated January 4, 2021, on business registration and any guiding, amending, supplementing, or replacing documents (if any). If members of a household register a household business, they may authorize one member to act as their representative. The individual registering the household business, or the person authorized by the household members to act as their representative, is the head of the household business. Households engaged in agriculture, forestry, fisheries, salt production, and those selling goods on the street, snacks, itinerant traders, mobile businesses, seasonal businesses, and service providers with low incomes are not required to register as business households, except in cases where the business involves conditional investment and business activities. The People's Committee of the province or centrally-governed city shall stipulate the low income threshold applicable within the locality.

2. "Large-scale household businesses and individual businesses" are household businesses and individual businesses with revenue and labor force meeting at least the highest level of criteria for micro-enterprises, specifically as follows: household businesses and individual businesses in the fields of agriculture, forestry, fisheries and industry, construction with an average annual number of employees participating in social insurance of 10 or more or total revenue of the preceding year of 3 billion VND or more; household businesses and individual businesses in the fields of trade and services with an average annual number of employees participating in social insurance of 10 or more or total revenue of the preceding year of 10 billion VND or more.

3. "Declaration method" refers to the method of declaring and calculating taxes based on a percentage of actual revenue generated on a monthly or quarterly basis.

4. "Household businesses and individual businesses paying taxes using the declaration method" refers to large-scale household businesses and individual businesses; and household businesses and individual businesses that do not meet the large-scale criteria but choose to pay taxes using the declaration method.

5. "The transaction-based tax filing method" is a method of filing and calculating taxes based on a percentage of the actual revenue generated each time a transaction occurs.

6. "Individuals who pay taxes on each transaction" refers to individuals who conduct business irregularly and do not have a fixed business location.

7. "The lump-sum method" is a method of calculating tax based on a percentage of the lump-sum revenue determined by the tax authority to calculate the lump-sum tax amount as stipulated in Article 51 of the Law on Tax Administration.

8. "Household businesses and individual businesses paying taxes using the lump-sum method" refers to household businesses and individual businesses that do not implement or do not fully implement accounting, invoicing, and documentation procedures, except for household businesses and individual businesses that are subject to tax declaration and individual businesses that are subject to tax payment on a transaction-by-transaction basis.

9. "Lump-sum tax" refers to the amount of tax and other revenues payable by business households and individual business owners paying taxes using the lump-sum method, as determined by the tax authority in accordance with Article 51 of the Law on Tax Administration.

10. “Business cooperation between organizations and individuals” refers to an organization that agrees with an individual to jointly contribute assets and labor to carry out production and business activities, sharing benefits and responsibilities as stipulated in Article 504 of the Civil Code dated November 24, 2015, and any guiding, amending, supplementing, or replacing documents (if any).

11. “Electronic commerce activities” means conducting part or all of the process of commercial activities by electronic means connected to the internet, mobile telecommunications networks or other open networks as prescribed in Clause 1, Article 3 of Government Decree No. 52/2013/ND-CP dated May 16, 2013 on electronic commerce and guiding documents or amendments, supplements or replacements (if any).

12. “Digital information content products” are content and information products including text, data, images, and audio expressed in digital form, stored and transmitted over the network environment as stipulated in Clause 11, Article 3 of Government Decree No. 71/2007/ND-CP dated May 3, 2007, detailing and guiding the implementation of a number of articles of the Law on Information Technology concerning the information technology industry and any guiding, amending, supplementing, or replacing documents (if any).

13. “Digital information content service” is a service provided on the network environment that directly supports and serves the production, exploitation, distribution, upgrading, warranty, and maintenance of digital information content products and other similar activities related to digital information content as stipulated in Clause 12, Article 3 of Government Decree No. 71/2007/ND-CP dated May 3, 2007, and any guiding, amending, supplementing, or replacing documents (if any).

14. “Tax Office” includes the Tax Office and the Regional Tax Office.

15. “Tax Authority Database” includes the tax sector’s centralized integrated information system; results of verification and survey of production and business factors; results of tax audits and inspections; and its own database. Production and business factors that must be verified and surveyed include: labor costs; electricity costs; water costs; telecommunications costs; warehouse and business premises rental costs; management costs; and other costs.

16. "Private database" refers to a database built, managed, and used exclusively by the tax authority for each locality.

Chapter II

PRINCIPLES, METHODS, AND BASIS FOR CALCULATING TAXES FOR HOUSEHOLD BUSINESSES AND INDIVIDUAL BUSINESSES

Article 4. Principles of Tax Calculation

1. The principles for calculating taxes for household businesses and individual businesses are implemented according to the provisions of current laws on Value Added Tax (VAT), Personal Income Tax (PIT), and other relevant legal documents.

2. Household businesses and individual business owners with annual revenue from production and business activities of VND 100 million or less are exempt from Value Added Tax (VAT) and Personal Income Tax (PIT) according to the laws on VAT and PIT. Household businesses and individual business owners are responsible for accurately, truthfully, and completely declaring taxes and submitting tax returns on time; they are legally responsible for the accuracy, truthfulness, and completeness of their tax returns as prescribed.

3. For household businesses and individual businesses in the form of groups of individuals or households, the revenue level of VND 100 million/year or less to determine whether an individual is not required to pay VAT or personal income tax is determined for one (01) sole representative of the group of individuals or household in the tax year.

Article 5. Method of calculating tax for business households and individual business owners paying tax using the declaration method.

1. The declaration method applies to large-scale household businesses and individual businesses; and household businesses and individual businesses that do not meet the large-scale criteria but choose to pay taxes using the declaration method.

2. Household businesses and individual business owners paying taxes using the declaration method shall declare taxes monthly, except for newly established household businesses and individual business owners, and household businesses and individual business owners who meet the criteria for quarterly tax declaration and choose to declare taxes quarterly as stipulated in Article 9 of Government Decree No. 126/2020/ND-CP dated October 19, 2020.

3. For household businesses and individual business owners paying taxes using the declaration method, if the taxable revenue is determined to be inconsistent with reality, the tax authority shall determine the taxable revenue in accordance with the provisions of Article 50 of the Law on Tax Administration.

4. Household businesses and individual business owners paying taxes using the declaration method must maintain accounting records, invoices, and supporting documents. However, if a household business or individual business operates in a field or industry where revenue can be determined based on confirmation from a competent authority, then it is not required to maintain accounting records.

5. Household businesses and individual business owners who pay taxes using the declaration method are not required to file a tax return.

Article 6. Method of calculating tax for individuals conducting business and paying tax on each transaction.

1. The method of filing tax returns on a transaction-by-transaction basis applies to individuals engaged in irregular business activities and without a fixed business location. Irregular business is defined based on the characteristics of the production and business activities of each field and industry, and is determined by the individual to choose the tax filing method according to the guidelines in this Circular. A fixed business location is where an individual conducts production and business activities, such as: a transaction location, shop, store, factory, warehouse, dock, yard, or other similar location.

2. Individuals conducting business pay taxes on each transaction, including:

a) Individuals engaged in itinerant business;

b) Individuals who are private construction contractors;

c) Individuals transferring Vietnamese national internet domain names “.vn”;

d) Individuals who earn income from digital information content products and services but do not choose to pay taxes using the declaration method.

3. Individuals conducting business and paying taxes on a transaction-by-transaction basis are not required to maintain accounting records, but must retain invoices, receipts, contracts, and documents proving the legality of goods and services, and submit them with their tax returns for each transaction.

4. Individuals conducting business who pay taxes on a transaction-by-transaction basis must file tax returns whenever taxable revenue is generated.

Article 7. Methods of calculating tax for business households and individual business owners paying tax using the lump-sum method.

1. The lump-sum method is applied to business households and individual businesses that are not subject to tax declaration and are not subject to tax payment on a transaction-by-transaction basis as guided in Articles 5 and 6 of this Circular.

2. Household businesses and individual business owners paying taxes using the lump-sum method (lump-sum tax households) are not required to maintain accounting records. Lump-sum tax households using individual invoices must store and present invoices, documents, contracts, and records proving the legality of goods and services to the tax authorities when requesting the issuance or sale of individual invoices for each transaction. However, in the case of lump-sum tax households operating in border markets, border gate markets, or markets within border economic zones in Vietnam, they must store invoices, documents, contracts, and records proving the legality of goods and services and present them upon request by competent state management agencies.

3. Households operating under a contract for a less than full year (not 12 months in a calendar year) include: newly established businesses, businesses operating seasonally, and businesses that have ceased or temporarily suspended operations. For households operating under a contract for a less than full year, the revenue threshold of VND 100 million/year or less to determine whether they are exempt from VAT and personal income tax is the taxable income for one calendar year (12 months); the actual taxable revenue to determine the amount of tax payable in the year is the revenue corresponding to the actual number of months of business operation.

Example 1: Mr. A started his business in April 2022, and projected his revenue for the first 9 months of actual business operations to be 90 million VND (an average of 10 million VND/month). Therefore, his revenue for one year (12 months) would be 120 million VND (>100 million VND). Thus, Mr. A is subject to VAT and personal income tax corresponding to the actual revenue generated from April 2022, which is 90 million VND.

4. Households paying taxes on a lump-sum basis declare taxes annually as stipulated in point c, clause 2, Article 44 of the Law on Tax Administration, and pay taxes within the deadline stated on the tax authority's payment notice as stipulated in clause 2, Article 55 of the Law on Tax Administration. If a household paying taxes uses invoices issued by the tax authority and sells them individually, the household must declare and pay taxes separately for the revenue generated on each invoice.

Article 8. Method of tax calculation for cases where organizations or individuals file tax returns or pay taxes on behalf of individuals.

1. Organizations and individuals may file and pay taxes on behalf of individuals in the following cases:

a) An organization that leases assets from an individual, where the lease agreement stipulates that the lessee is responsible for paying the tax;

b) Organizing business cooperation with individuals;

c) Organizing the payment of bonuses, sales targets, promotions, trade discounts, payment discounts, cash or non-cash support payments, compensation for breach of contract, and other compensation to contracted households;

d) Organizations in Vietnam that are partners of foreign digital platform providers (without a permanent establishment in Vietnam) that make payments for income from digital information content products and services to individuals in accordance with agreements with foreign digital platform providers;

d) Organizations that own e-commerce platforms shall file and pay taxes on behalf of individuals according to the tax authority's schedule. Until they can file and pay taxes on behalf of individuals, organizations that own e-commerce platforms are responsible for providing information related to the individual's business activities through the platform as requested by the tax authority in accordance with the law, such as: full name; personal identification number or citizen identification number or passport; tax code; address; email; contact phone number; goods and services provided; business revenue; seller's bank account; and other relevant information.

e) Organizations or individuals who file tax returns or pay taxes on behalf of individuals under authorization from civil law.

2. Organizations and individuals who file and pay taxes on behalf of individual business owners, as guided in Clause 1 of this Article, shall file and pay taxes as follows:

a) In cases where tax declarations and tax payments are made on behalf of the entities guided in point a, clause 1 of this Article, the organization shall declare and pay taxes monthly, quarterly, or on a case-by-case basis for each payment period or calendar year, in accordance with the provisions of the law on tax administration.

b) In cases where tax declarations and tax payments are made on behalf of the entities guided in points b, c, d, and e of Clause 1 of this Article, the organization shall declare and pay taxes monthly or quarterly in accordance with the provisions of the law on tax administration.

c) In cases where tax declaration and tax payment are made on behalf of the subjects guided in point e, clause 1 of this Article, the organization or individual shall declare and pay taxes in accordance with the provisions of the law on tax administration for the authorizing individual.

3. In cases where an individual generates revenue of VND 100 million or less per year from multiple sources, and the individual anticipates or determines that total revenue exceeds VND 100 million per year, they may authorize the paying organizations to file and pay taxes on their behalf for revenue generated at the authorized units during the tax year. Specifically for households under the lump-sum tax system, if, in addition to the lump-sum revenue, they also receive bonuses, sales support, promotions, trade discounts, payment discounts, cash or non-cash support, compensation for contract breaches, or other compensation, the paying organization shall file and pay taxes on their behalf based on the actual payments made during the tax year. If an organization files and pays taxes on behalf of an individual renting out property, the threshold of VND 100 million per year or less shall be used to determine the tax-exempt entity, as guided in point c, clause 1, Article 9 of this Circular.

Article 9. Methods of calculating tax in certain special cases

1. Individuals renting out property

a) Individuals who rent out property are those who generate revenue from renting out property, including: renting houses, premises, shops, workshops, warehouses (excluding accommodation services); renting transportation vehicles, machinery and equipment without operators; and renting other property without accompanying services. Accommodation services not included in property rental activities as guided in this section include: providing short-term accommodation for tourists and other visitors; providing long-term accommodation (other than apartments) for students, workers, and similar groups; and providing accommodation along with food and beverage services or entertainment facilities.

b) Individuals who lease property declare taxes on each payment period (each payment period is determined by the start date of the lease term for each payment period) or declare taxes annually according to the calendar year. Individuals declare taxes for each contract or declare taxes for multiple contracts on a single tax return if the leased property is located in an area under the jurisdiction of the same tax authority.

c) For individuals who rent out property and do not generate revenue for a full 12 months in a calendar year (including cases with multiple rental contracts), the revenue threshold of VND 100 million/year or less used to determine whether the individual is exempt from VAT and personal income tax is the taxable income for one calendar year (12 months); the actual taxable revenue used to determine the tax payable in the year is the revenue corresponding to the actual number of months in which the property was rented out.

Example 2: Mr. B entered into a house rental contract with an agreed rent of 10 million VND/month for the period from October 2022 to the end of September 2023. Thus, the actual revenue in 2022 was 30 million VND, but the total revenue calculated over 12 months of 2022 was 120 million VND; the actual revenue in 2023 was 90 million VND, but the total revenue calculated over 12 months of 2023 was 120 million VND. Therefore, Mr. B is subject to VAT and personal income tax corresponding to the actual revenue generated in 2022 and 2023 according to the above contract.

d) If the lessee pays in advance for multiple years, the lessor shall declare and pay tax once on the entire prepaid revenue. The lump-sum tax payable is the total tax payable for each calendar year as stipulated. In case of changes to the lease contract resulting in changes to taxable revenue, payment period, or lease term, the lessor shall declare adjustments and supplements in accordance with the Law on Tax Administration for the tax period in which the changes occurred.

2. Individuals who directly sign contracts to act as lottery agents, insurance agents, or multi-level marketing agents.

a) Individuals who directly sign contracts to act as lottery agents, insurance agents, or multi-level marketing agents are individuals who directly sign contracts with lottery companies, insurance companies, or multi-level marketing companies in the form of agents selling at fixed prices.

b) Individuals who directly sign contracts as lottery agents, insurance agents, or multi-level marketing agents do not directly declare taxes, except as guided in point d of this section. Lottery companies, insurance companies, and multi-level marketing companies are responsible for withholding, declaring, and paying personal income tax if the company determines that the commission paid to the individual in the calendar year exceeds 100 million VND. If, in a given year, the individual generates revenue of 100 million VND or less from multiple sources, and the individual anticipates or determines that the total revenue exceeds 100 million VND per year, they may authorize the income-paying organizations to withhold tax on the commission received from the company in the tax year.

c) Lottery companies, insurance companies, and multi-level marketing companies shall file tax returns monthly or quarterly in accordance with the law on tax administration and are not required to file final tax returns for the obligation to withhold personal income tax of individuals acting as lottery agents, insurance agents, or multi-level marketing agents.

d) If, during the year, the income-paying organization has not deducted tax because the income has not reached the deduction threshold and the individual has not authorized the income-paying organization to deduct it, and at the end of the year the individual determines that they are subject to tax according to regulations, then the individual shall declare and pay tax annually.

Article 10. Basis for tax calculation

The basis for calculating tax for household businesses and individual businesses is taxable revenue and the tax rate applied to that revenue.

1. Taxable revenue

The taxable revenue for VAT and personal income tax purposes for household businesses and individual businesses is the revenue including tax (if subject to tax) from all sales, processing fees, commissions, and service fees arising during the tax period from the production and business activities of goods and services, including bonuses, sales support, promotions, trade discounts, payment discounts, cash or non-cash support; subsidies, surcharges, additional fees received according to regulations; compensation for breach of contract, other compensation (only included in taxable personal income tax revenue); and other revenue received by household businesses and individual businesses, regardless of whether the money has been collected or not.

2. Tax rate based on revenue

a) The tax rate on revenue includes the VAT rate and the personal income tax rate, applied in detail to each field and industry as guided in Appendix I issued with this Circular.

b) In cases where a business household or individual operates in multiple fields or sectors, the business household or individual shall declare and calculate taxes according to the tax rate applied to revenue for each field or sector. If the business household or individual cannot determine the taxable revenue for each field or sector, or if the determined revenue is inconsistent with actual business operations, the tax authority shall determine the taxable revenue for each field or sector in accordance with the provisions of the law on tax administration.

3. Determine the amount of tax payable.

VAT payable = Taxable revenue x VAT rate

Personal income tax payable = Taxable income x Personal income tax rate

In which:

– Taxable revenue for VAT and taxable revenue for personal income tax shall be determined according to the guidelines in Clause 1 of this Article.

– The VAT rate and personal income tax rate are as guided in Appendix I issued with this Circular.

Chapter III

TAX MANAGEMENT FOR HOUSEHOLD BUSINESSES AND INDIVIDUAL BUSINESSES

Article 11. Tax management for business households and individual business owners paying taxes using the declaration method.

1. Tax return documents

The tax return documents for household businesses and individual business owners paying taxes using the declaration method are specified in point 8.2 of Appendix I – List of tax return documents issued with Government Decree No. 126/2020/ND-CP dated October 19, 2020, as follows:

a) Tax declaration form for household businesses and individual businesses, using mẫu số 01/CNKD (form number 01/CNKD) issued together with this Circular;

b) Appendix: Statement of business activities during the period of household businesses and individual businesses (applicable to household businesses and individual businesses paying taxes using the declaration method) according to mẫu số 01-2/BK-HĐKD issued with this Circular. In the case of household businesses and individual businesses paying taxes using the declaration method, if there is a basis to determine revenue based on confirmation from competent authorities, they are not required to submit Appendix 01-2/BK-HĐKD issued with this Circular.

2. Where to file tax returns

For household businesses and individual business owners paying taxes using the declaration method as stipulated in Clause 1, Article 45 of the Law on Tax Administration, the place to file tax returns is the Tax Sub-department directly managing the area where the household business or individual business operates its production and business activities.

3. Deadline for filing tax returns

The deadline for filing tax returns for household businesses and individual business owners paying taxes using the declaration method is stipulated in Clause 1, Article 44 of the Law on Tax Administration, specifically as follows:

a) The deadline for filing tax returns for household businesses and individual business owners paying taxes using the monthly declaration method is no later than the 20th day of the month following the month in which the tax liability arises.

b) The deadline for submitting tax returns for household businesses and individual business owners paying taxes using the quarterly declaration method is no later than the last day of the first month of the quarter immediately following the quarter in which the tax liability arises.

4. Tax payment deadline

The deadline for tax payment by household businesses and individual business owners paying taxes using the declaration method is in accordance with the provisions of Clause 1, Article 55 of the Law on Tax Administration, specifically: The deadline for tax payment is no later than the last day of the deadline for submitting tax declarations. In the case of supplementary tax declarations, the deadline for tax payment is the deadline for submitting the tax declaration for the tax period containing errors or omissions.

5. Tax filing obligations in case of temporary suspension of business operations.

In cases where a household business or individual business temporarily suspends operations, they must notify the tax authorities as stipulated in Article 91 of Government Decree No. 01/2021/ND-CP dated November 4, 2021, Article 4 of Government Decree No. 126/2020/ND-CP dated October 19, 2020, and Article 12 of Circular No. 105/2020/TT-BTC dated December 3, 2020 of the Ministry of Finance guiding tax registration. They are not required to submit tax declaration documents, except in cases where the household business or individual business temporarily suspends operations for less than a full month if filing taxes monthly, or temporarily suspends operations for less than a full quarter if filing taxes quarterly.

Article 12. Tax management for individual business owners paying taxes on each transaction.

1. Tax return documents

The tax return documents for individuals conducting business and paying taxes on a transaction-by-transaction basis are stipulated in point 8.3 of Appendix I – List of tax return documents issued with Government Decree No. 126/2020/ND-CP dated October 19, 2020, specifically as follows:

a) Tax declaration form for household businesses and individual businesses, using mẫu số 01/CNKD (form number 01/CNKD) issued together with this Circular;

b) The documents accompanying the tax return for each transaction include:

– A copy of the economic contract for the supply of goods and services;

– Copies of the acceptance and contract settlement minutes;

– Copies of documents proving the origin of goods, such as: a list of agricultural product purchases if the goods are domestically produced; a list of goods bought, sold, or exchanged by border residents if the goods are imported by border residents; an invoice from the seller if the goods are imported and purchased from domestic businesses or individuals; relevant documents to prove the origin if the goods are self-produced by an individual;…

The tax authorities have the right to request the original document for comparison and verification of its accuracy against the original.

2. Where to file tax returns

The place for filing tax returns for individual business owners paying taxes on a transaction-by-transaction basis, as stipulated in Clause 1, Article 45 of the Law on Tax Administration, is as follows:

a) In the case of mobile businesses, tax declarations should be submitted to the Tax Office directly managing the location where the individual conducts business activities.

b) In cases where individuals earn income from digital information content products and services, they should file their tax returns at the Tax Office directly managing their place of residence (permanent or temporary residence).

c) In the case of individuals earning income from the transfer of Vietnamese national internet domain names “.vn”, they must file their tax returns at the Tax Office where they reside. If the transferring individual is a non-resident, they must file their tax returns at the tax authority directly managing the organization that manages the Vietnamese national internet domain name “.vn”.

d) In the case of an individual who is a private construction contractor, the tax return should be submitted to the Tax Office directly managing the area where the individual's construction activities take place.

3. Deadline for filing tax returns

The deadline for filing tax returns for individuals conducting business and paying taxes on a transaction-by-transaction basis, as stipulated in Clause 3, Article 44 of the Law on Tax Administration, is no later than the 10th day from the date the tax liability arises.

4. Tax payment deadline

The deadline for individual business owners paying taxes on a transaction-by-transaction basis is governed by Clause 1, Article 55 of the Law on Tax Administration, specifically: The deadline for tax payment is no later than the last day of the deadline for submitting tax returns. In the case of supplementary tax returns, the deadline for tax payment is the deadline for submitting the tax return for the tax period containing the error.

Article 13. Tax management for households paying taxes under the lump-sum tax system.

1. Basis for determining lump-sum tax for households paying lump-sum tax.

The basis for determining lump-sum tax includes:

a) Tax returns for lump-sum taxpayers are self-declared by the taxpayers based on their projected revenue and lump-sum tax rate for the tax year;

b) The tax authority's database;

c) Consultative opinions from the tax advisory council of the commune, ward, or town;

d) Results of information disclosure and feedback received from the Tax Advisory Council, People's Committee, People's Council, Fatherland Front of communes, wards, towns, contracted households, and other organizations and individuals.

Public disclosure of information on lump-sum tax payments refers to the process by which tax authorities publicly disclose and receive feedback on revenue and lump-sum tax amounts for these households as stipulated. The first public disclosure, as per Clause 5 of this Article, is for reference and feedback on projected revenue and lump-sum tax amounts; and the second public disclosure, as per Clause 9 of this Article, is for reference and feedback on the official revenue and lump-sum tax payable for the tax year. Information disclosure includes: posting information in paper form in the locality; sending it directly to lump-sum tax payers; sending it directly to the People's Council, People's Committee, and Fatherland Front of the district, commune, ward, or town; and publishing the information on the Tax Department's website.

2. Tax return documents

a) From November 20th to December 5th each year, the tax authority issues the tax return form for the following year to all taxpayers under the lump-sum tax system.

b) The tax declaration dossier for households under the lump-sum tax scheme as stipulated in point 8.1 of Appendix I – List of tax declaration dossiers issued together with Government Decree No. 126/2020/ND-CP dated October 19, 2020, is the Tax Declaration Form for household businesses and individual businesses, mẫu số 01/CNKD, issued together with this Circular.

c) In cases where a household engaged in lump-sum tax uses invoices issued by the tax authority and sells retail goods on a transaction-by-transaction basis, when declaring tax on revenue from these individual invoices, the household engaged in lump-sum tax shall declare tax on each transaction and use the Tax Declaration Form for Household Businesses and Individual Businesses (Form No. 01/CNKD) issued with this Circular, and simultaneously submit the following documents with the tax declaration dossier:

– A copy of the economic contract for the supply of goods and services in the same industry as the household's contracted business activities;

– Copies of the acceptance and contract settlement minutes;

– Copies of documents proving the origin of goods and services, such as: a list of agricultural product purchases if the goods are domestically produced; a list of goods bought and sold or exchanged by border residents if the goods are imported by border residents; an invoice from the seller if the goods are imported and purchased from domestic businesses or individuals; relevant documents to prove the origin if the goods are produced or supplied by individuals themselves;…

The tax authorities have the right to request the original document for comparison and verification of its accuracy against the original.

3. Deadline for filing tax returns

The deadline for filing tax returns for taxpayers under the lump-sum tax system is stipulated in point c, clause 2, and clause 3 of Article 44 of the Law on Tax Administration, specifically as follows:

a) The deadline for filing tax returns for taxpayers under the lump-sum tax system is no later than December 15th of the year preceding the tax year.

b) In the case of newly established businesses (including those switching to the lump-sum method), or those switching to the declaration method, or those changing their business sector, or those changing their business scale during the year, the deadline for submitting tax returns is no later than the 10th day from the date of commencement of business, or change in tax calculation method, or change in business sector, or change in business scale.

c) The deadline for submitting tax returns for taxpayers using invoices issued by the tax authority for retail sales on a transaction-by-transaction basis is no later than the 10th day from the date of revenue generation requiring the use of invoices.

4. Determine revenue and lump-sum tax amount.

a) Determine revenue and lump-sum tax amount

a.1) Revenue and lump-sum tax are calculated on a calendar year basis or monthly for seasonal businesses that remain stable for one year.

a.2) Households paying flat-rate taxes shall determine their own taxable revenue for the year on the Tax Declaration Form No. 01/CNKD issued with this Circular. If a household paying flat-rate taxes cannot determine their taxable revenue, fails to submit a tax declaration, or the determined taxable revenue does not reflect actual business operations, the tax authority shall assess the revenue and determine the flat-rate tax amount in accordance with Article 51 of the Law on Tax Administration.

a.3) Based on the tax declaration records of lump-sum taxpayers and the tax authority's database, public opinions will be sought, opinions will be consulted with the Tax Advisory Council, and this will serve as the basis for the Tax Department to direct and review the preparation of tax registers at each Tax Sub-department.

b) Adjusting revenue and lump-sum tax rates

If a taxpayer who pays a lump-sum tax within the year requests an adjustment to their revenue or lump-sum tax amount due to changes in their business activities, the tax authority will readjust the lump-sum tax amount according to the provisions of Clause 3, Article 51 of the Law on Tax Administration from the time of the change. Specifically as follows:

b.1) Households paying lump-sum taxes that change their business scale (business area, number of employees, revenue) must file an amended or supplementary tax return using form No. 01/CNKD issued with this Circular. Based on the household's tax return and the tax authority's database, if the lump-sum revenue changes by 50% or more compared to the previously agreed-upon revenue, the tax authority will issue a Notice (form No. 01/TB-CNKD issued with Government Decree No. 126/2020/NĐ-CP dated October 19, 2020) regarding the adjustment of the lump-sum tax rate from the time of the change in the tax year. In cases where, through the tax authority's database, verification, inspection, and audit data, the tax authority has grounds to determine that a household paying lump-sum tax does not meet the conditions for adjusting the lump-sum tax rate as prescribed, the tax authority shall issue a Notice of Non-Adjustment of Lump-Sum Tax Rate using form No. 01/TBKĐC-CNKD issued together with this Circular.

b.2) If a household engaged in lump-sum tax changes its business location, it must update its tax registration information as prescribed and carry out tax declaration procedures at the new location as if it were a newly established household engaged in lump-sum tax. The tax authority will process the change in tax registration information based on the regulations. The tax authority managing the new location will process the household's tax declaration as if it were a newly established household engaged in lump-sum tax. The tax authority managing the previous location will issue a Notice (Form No. 01/TB-CNKD issued with Government Decree No. 126/2020/NĐ-CP dated October 19, 2020) regarding the adjustment of the lump-sum tax amount from the time of the change in the tax year.

b.3) If a household paying lump-sum tax changes its business sector or field of business (even if there is no change in the applicable tax rate or percentage), the household must follow the procedures for changing its tax registration information as prescribed (if there is a change in business sector or field compared to the tax registration), and simultaneously file an amended and supplementary tax return using form No. 01/CNKD issued with this Circular. The tax authority will base its decision on the results of processing the tax registration information change application (if any) and on the household's tax return documents and the tax authority's database to issue a Notice (form No. 01/TB-CNKD issued with Government Decree No. 126/2020/NĐ-CP dated October 19, 2020) regarding the adjustment of the lump-sum tax amount (if any) according to the actual situation from the time of the change in the tax year.

b.4) If a household under the lump-sum tax system ceases or temporarily suspends business operations, the household must notify the authorities when ceasing or temporarily suspending business operations in accordance with the provisions of Article 4 of Government Decree No. 126/2020/ND-CP dated October 19, 2020. The tax authority shall base its adjustment of the lump-sum tax rate on the notification from the household under the lump-sum tax system or the competent state agency as prescribed in Article 37 of the Law on Tax Administration:

b.4.1) For households with lump-sum tax who have been notified of approval to cease business operations: if the household ceases business operations from the first day of the calendar month, the entire lump-sum tax amount will be reduced from the month of cessation; if the household ceases business operations at any time between the 02nd and 15th of the calendar month, the lump-sum tax for the month in which the cessation begins will be reduced by 50%, and the entire lump-sum tax for the months following the cessation will be reduced; if the household ceases business operations at any time from the 16th onwards of the calendar month, the lump-sum tax for the month in which the cessation begins will not be reduced, only the entire lump-sum tax for the months following the cessation will be reduced.

b.4.2) For households with lump-sum tax who have been notified of approval for temporary business suspension: if the household suspends business for the entire month of the calendar year, the lump-sum tax for that month will be adjusted down completely; if the household suspends business for 15 consecutive days or more in a month of the calendar year, the lump-sum tax payable for that month will be adjusted down by 50%.

b.4.3) The period of business suspension or temporary cessation is determined by notification from the taxpayer. In cases where the taxpayer suspends or temporarily ceases business without notification or notifies late (including cases due to force majeure as stipulated), the tax authority will base its determination of the period of business suspension or temporary cessation on the results of actual verification.

b.5) ​​If a taxpayer ceases or temporarily suspends business operations at the request of a competent state management agency, the tax authority shall, based on the written request for cessation or temporary suspension from the competent state management agency, adjust the lump-sum tax rate according to the actual period of cessation or temporary suspension of business operations.

b.6) If a household under the lump-sum tax system switches to the declaration method, the household under the lump-sum tax system shall file an amended and supplementary tax return using form No. 01/CNKD issued with this Circular. The tax authority shall use the amended and supplementary tax return to adjust and reduce the lump-sum tax amount for the transition period.

5. Second public listing

The tax authorities conduct the first public posting for reference and feedback on projected revenue and projected lump-sum tax rates. The documents for the first public posting include: a list of households subject to lump-sum tax exemption (VAT) and personal income tax exemption (PIT); ​​and a list of households subject to tax. The first public posting is carried out as follows:

a) The Tax Department shall publicly post the first notice at the one-stop service counter of the Tax Department, the People's Committee of the district/county; at the entrance, gate, or convenient location for accessing information, or at a suitable location of the headquarters of the People's Committee of the commune/ward/township; the headquarters of the Tax Team; and the Market Management Board for citizens and contracted households to monitor. The first posting period is from December 20th to December 31st of each year.

b) The Tax Department shall send the first public posting of documents to the People's Council and the Fatherland Front of the district, commune, ward, or town no later than December 20th of each year, clearly stating the address and time when the Tax Department will receive feedback (if any) from the People's Council and the Fatherland Front of the district, commune, ward, or town. The deadline for the Tax Department to receive feedback (if any) is December 31st.

c) No later than December 20th of each year, the Tax Department shall send to each household a Notice of projected revenue and lump-sum tax amount according to mẫu số 01/TBTDK-CNKD accompanied by a Public Disclosure Table of information on lump-sum households according to mẫu số 01/CKTT-CNKD (hereinafter referred to as the Public Disclosure Table) issued with this Circular, which clearly states the address and time the Tax Department will receive feedback (if any) from the lump-sum household no later than December 31st. The Notice shall be sent directly to the lump-sum household (with the taxpayer's signature acknowledging receipt of the notice) or sent by registered mail. The Public Disclosure Table of information expected to be sent to lump-sum households shall be prepared according to the area including both individuals subject to tax and individuals not subject to tax. For markets, streets, and residential areas with two hundred (200) lump-sum households or less, the Tax Department shall print and distribute to each lump-sum household the Public Disclosure Table of lump-sum households in the area. In cases where markets, streets, or residential areas have more than 200 households under the lump-sum tax system, the Tax Sub-department shall print and distribute to each household a Public Disclosure Table for no more than 200 households under the lump-sum tax system in the area. For markets with more than 200 households under the lump-sum tax system, the Tax Sub-department shall print and distribute to each household a Public Disclosure Table categorized by product category. If the tax authority has already published the Public Disclosure Table on its electronic portal, it is not mandatory to send the Public Disclosure Table in form No. 01/CKTT-CNKD along with the Notice on Projected Revenue and Lump-Sum Tax Amount in form No. 01/TBTDK-CNKD issued with this Circular.

d) The Tax Department is responsible for publicly announcing the location of the posted notice and the address for receiving feedback (telephone number, fax number, address at the one-stop service department, email address) regarding the content of the public notice so that taxpayers under the lump-sum tax system are aware.

d) The Tax Department is responsible for compiling feedback on the first public posting of information from citizens, taxpayers, the People's Council and the Fatherland Front of districts, communes, wards, and towns to study and adjust or supplement the management subjects, projected revenue levels, and projected tax rates before consulting with the Tax Advisory Council.

6. Consult with the Tax Advisory Council.

The Tax Department organizes consultative meetings of the Tax Advisory Council between January 1st and January 10th of each year. Meeting documents for the Tax Advisory Council comply with the regulations of the law on tax administration.

7. Prepare and approve the Tax Register.

a) The Tax Department shall base its assessment of the lump-sum tax rate on the documents guiding in Clause 1, Article 3 of this Circular and the directive from the superior tax authority (if any) to prepare and approve the Tax Register before January 15th of each year.

b) Monthly, based on changes in the business activities of the taxpayer (changes in business activities) or changes in tax policies affecting the taxable revenue and the amount of tax payable, the Tax Sub-department shall prepare and approve the adjusted and supplemented Tax Register and issue a Notice of Adjustment of the Taxable Amount as guided in point b, clause 4 of this Article.

8. Send tax notices and payment deadlines.

a) Send tax notices

a.1) The tax authority shall send the Notice of Payment of Taxes (Form No. 01/TB-CNKD issued together with Government Decree No. 126/2020/ND-CP dated October 19, 2020) along with the Public Disclosure Table (Form No. 01/CKTT-CNKD issued together with this Circular) to taxpayers under the lump-sum tax system (including both taxpayers subject to tax and taxpayers exempt from tax) no later than January 20th of each year. The notice shall be sent directly to the taxpayer under the lump-sum tax system (with the taxpayer's signature acknowledging receipt) or sent by registered mail.

a.2) The official information disclosure table sent to tax-paying households is compiled by geographical area, including both tax-paying and non-tax-paying households. For markets, streets, and residential areas with 200 or fewer tax-paying households, the Tax Department prints and distributes the information disclosure table for each household in the area. If the market, street, or residential area has more than 200 tax-paying households, the Tax Department prints and distributes the information disclosure table for no more than 200 households in the area. For markets with more than 200 tax-paying households, the Tax Department prints and distributes the information disclosure table by product category. If the tax authority has already made the information public on its electronic portal, it is not mandatory to send the Public Disclosure Table (Form No. 01/CKTT-CNKD) along with the Payment Notice (Form No. 01/TB-CNKD) issued with Government Decree No. 126/2020/NĐ-CP dated October 19, 2020.

a.3) In cases where the tax authority issues a Notice of Adjustment of the lump-sum tax amount based on the notification from the lump-sum taxpayer as guided in point b, clause 4 of this Article, the deadline for issuing the notice is no later than the 20th of the month following the month in which the tax amount changes.

a.4) In the case of newly established businesses under the lump-sum tax system, the tax authority shall send the Notice of Payment of Taxes (Form No. 01/TB-CNKD) issued together with Government Decree No. 126/2020/ND-CP dated October 19, 2020, to the lump-sum taxpayer no later than the 20th of the month following the month in which the tax payable arises.

b) Tax payment deadline

b.1) Based on the Payment Notice, taxpayers paying under the lump-sum tax system shall pay VAT and personal income tax within the deadline specified in Payment Notice Form No. 01/TB-CNKD issued together with Government Decree No. 126/2020/NĐ-CP dated October 19, 2020.

b.2) In cases where households under the lump-sum tax system use invoices issued by the tax authority on a transaction-by-transaction basis, the deadline for paying tax on the revenue shown on the invoice is the same as the deadline for declaring tax on the revenue shown on the invoice, as guided in point c, clause 3 of this Article.

9. Second public listing

The tax authorities conduct a second public posting of the official revenue and tax payable for the year for taxpayers under the lump-sum tax system. The second public posting is carried out as follows:

a) At the Tax Department level

a.1) The Tax Department shall publicly post information on lump-sum tax payers before January 30th of each year on the tax authority's website, including the following information: List of lump-sum tax payers who are exempt from VAT and personal income tax; List of lump-sum tax payers who are required to pay tax.

a.2) In cases where a newly registered business household starts operating or there are changes in the amount of tax payable or changes in business status, the Tax Department shall publicly disclose or update the information on the tax authority's website no later than the last day of the month following the month in which the business household starts operating or the changes occur.

b) At the District Tax Office level

b.1) The Tax Department shall publicly post the information for the second time before January 30th of each year at the one-stop service counter of the Tax Department, the People's Committee of the district/county; at the entrance, gate or convenient location for accessing information, or at a suitable location of the headquarters of the People's Committee of the commune/ward/township; the headquarters of the Tax Team; and the Market Management Board for citizens and contracted households to monitor.

b.2) The Tax Department shall send the second public posting document to the People's Council and the Fatherland Front of the district, commune, ward, or town no later than January 30th, clearly stating the address and time when the Tax Department will receive feedback (if any) from the People's Council and the Fatherland Front of the district, commune, ward, or town.

b.3) The Tax Department is responsible for publicly announcing the location of the posted notice and the address for receiving feedback (telephone number, fax number, address at the one-stop service department, email address) regarding the content of the public notice so that taxpayers under the lump-sum tax system are aware.

b.4) Public disclosure of documents at the District Tax Office level shall be carried out in the same manner as the disclosure of information on the tax department's website at the Provincial Tax Office level.

Article 14. Tax management for individuals who directly rent out property and file tax returns with the tax authorities.

1. Tax return documents

The tax return documents for individuals who directly rent out property and file tax returns with the tax authorities are stipulated in Clause a, Point 8.5, Appendix I – List of tax return documents issued with Government Decree No. 126/2020/ND-CP dated October 19, 2020, as follows:

a) Tax declaration form for property rental activities (applicable to individuals who directly declare taxes to the tax authorities and organizations that declare on behalf of individuals) according to mẫu số 01/TTS issued with this Circular;

b) Appendix detailing the property lease contract (applicable to individuals directly filing tax returns with the tax authorities if this is the first tax return for the contract or contract appendix) according to mẫu số 01-1/BK-TTS issued with this Circular;

c) A copy of the lease agreement, or any appendix to the lease agreement (if this is the first tax filing for the lease agreement or appendix);

d) A copy of the legally prescribed power of attorney (in cases where an individual leasing property authorizes a legal representative to carry out tax declaration and payment procedures).

The tax authorities have the right to request the original document for comparison and verification of its accuracy against the original.

2. Where to file tax returns

Individuals who rent out property must file their tax returns directly with the tax authorities as stipulated in Clause 1, Article 45 of the Law on Tax Administration, specifically as follows:

a) Individuals with income from renting property (excluding real estate in Vietnam) must file their tax returns at the Tax Office directly managing their place of residence.

b) Individuals with income from renting real estate in Vietnam shall file tax returns at the Tax Office directly managing the location of the rented property.

3. Deadline for filing tax returns

The deadline for filing tax returns for individuals who directly rent out property and file tax returns with the tax authorities is stipulated in point a, clause 2 and clause 3 of Article 44 of the Law on Tax Administration, specifically as follows:

a) The deadline for filing tax returns for individuals filing tax returns on a per-payment basis is no later than the 10th day from the start date of the lease term for that payment period.

b) The deadline for filing tax returns for individuals filing taxes once a year is no later than the last day of the first month of the following calendar year.

4. Tax payment deadline

The deadline for tax payment for individuals who rent out property and file tax returns directly with the tax authorities is governed by Clause 1, Article 55 of the Law on Tax Administration, specifically: The deadline for tax payment is no later than the last day of the deadline for submitting tax returns. In the case of supplementary tax returns, the deadline for tax payment is the deadline for submitting the tax return for the tax period containing the errors.

Article 15. Tax management for individuals directly signing contracts as lottery agents, insurance agents, multi-level marketing agents, and other business activities.

1. Tax return documents

a) Monthly and quarterly tax return documents of the withholding organization

The monthly and quarterly tax return documents for tax-withholding organizations for individuals directly signing contracts as lottery agents, insurance agents, or multi-level marketing agents are stipulated in point 9.1 of Appendix I – List of tax return documents issued with Government Decree No. 126/2020/ND-CP dated October 19, 2020, specifically as follows:

– Personal income tax return form (applicable to lottery, insurance, and multi-level marketing businesses that pay commissions to individuals who directly sign agency contracts to sell at the correct price; insurance businesses that pay accumulated life insurance premiums and other non-compulsory insurance premiums) according to mẫu số 01/XSBHĐC issued with this Circular;

– Appendix detailing individuals with revenue generated from lottery agency activities, insurance agency activities, and multi-level marketing (declared in the tax return of the last month/quarter of the tax year) according to mẫu số 01-1/BK-XSBHĐC issued with this Circular (declaring all individuals with revenue generated in the tax year, regardless of whether tax deductions were made or not).

b) Annual tax return of the individual who directly files the tax return.

The annual tax return documents for individuals directly signing contracts as lottery agents, insurance agents, multi-level marketing agents, and other business individuals as stipulated in point 8.6 of Appendix I – List of tax return documents issued with Government Decree No. 126/2020/ND-CP dated October 19, 2020, are as follows:

– Annual tax return (applicable to individuals who directly sign contracts to act as agents for lottery, insurance, multi-level marketing, and other business activities for which no tax has been withheld or paid during the year) according to mẫu số 01/TKN-CNKD issued with this Circular;

– Copies of economic contracts (for the supply of goods, services, business cooperation, or agency agreements);

– Copies of the acceptance and contract termination report (if any).

The tax authorities have the right to request the original document for comparison and verification of its accuracy against the original.

2. Where to file tax returns

The place for filing tax returns for organizations deducting tax from individuals directly signing contracts as lottery agents, insurance agents, multi-level marketing agents, and individuals acting as lottery agents, insurance agents, multi-level marketing agents, or engaging in other business activities who directly file tax returns as stipulated in Clause 1, Article 45 of the Law on Tax Administration, is as follows:

a) Organizations that deduct taxes from individuals directly signing contracts to act as lottery agents, insurance agents, or multi-level marketing agents must file tax returns with the tax authority directly managing the organization.

b) Individuals acting as lottery agents, insurance agents, multi-level marketing agents, or engaging in other business activities subject to annual tax filing must submit their tax returns to the Tax Office directly managing their place of residence (permanent or temporary residence).

3. Deadline for filing tax returns

a) The deadline for filing tax returns for lottery businesses, insurance businesses, and multi-level marketing businesses is stipulated in Clause 1, Article 44 of the Law on Tax Administration, specifically as follows:

a.1) The deadline for submitting monthly tax returns for lottery companies, insurance companies, and multi-level marketing companies is no later than the 20th day of the month following the month in which the tax liability arises.

a.2) The deadline for submitting quarterly tax returns for lottery companies, insurance companies, and multi-level marketing companies is no later than the last day of the first month of the quarter immediately following the quarter in which the tax liability arises.

b) The deadline for filing annual tax returns for individuals directly signing contracts as lottery agents, insurance agents, multi-level marketing agents, or engaging in other business activities as stipulated in point a, clause 2, Article 44 of the Law on Tax Administration is no later than the last day of the first month of the following calendar year.

4. Tax payment deadline

The deadline for tax payment by organizations and individuals as stipulated in this Article shall comply with the provisions of Clause 1, Article 55 of the Law on Tax Administration, specifically: The deadline for tax payment is no later than the last day of the deadline for submitting tax declarations. In the case of supplementary tax declarations, the deadline for tax payment is the deadline for submitting the tax declaration for the tax period containing errors or omissions.

Article 16. Tax management for organizations and individuals filing and paying taxes on behalf of individuals.

1. Tax return documents

a) Monthly and quarterly tax declaration documents for organizations that declare and pay taxes on behalf of individuals in cases where the individual cooperates in business with the organization; the organization pays individuals who achieve sales targets; the organization is the owner of an e-commerce trading platform; or an organization in Vietnam that is a partner of a foreign digital platform provider (without a permanent establishment in Vietnam) that pays income to individuals as stipulated in point 8.4 of Appendix I – List of tax declaration documents issued with Government Decree No. 126/2020/ND-CP dated October 19, 2020, specifically as follows:

– Tax declaration form for household businesses and individual businesses, using mẫu số 01/CNKD (form number 01/CNKD) issued together with this Circular;

– Appendix: Detailed list of business households and individual businesses (applicable to organizations and individuals who declare and pay taxes on behalf of individuals; individuals cooperating in business with organizations; organizations paying individuals who achieve sales targets; organizations that own e-commerce trading platforms; organizations in Vietnam that are partners of foreign digital platform providers) according to mẫu số 01-1/BK-CNKD issued with this Circular;

– A copy of the business cooperation contract (if this is the first tax declaration for the contract). The tax authority has the right to request the original document for comparison and verification of its accuracy.

b) Tax declaration documents for organizations that declare and pay taxes on behalf of individuals renting out property, as stipulated in clause b, point 8.5, Appendix I – List of tax declaration documents issued with Government Decree No. 126/2020/ND-CP dated October 19, 2020, are as follows:

– Tax declaration form for property rental activities (applicable to individuals who directly declare taxes to the tax authorities and organizations that declare on behalf of individuals) according to mẫu số 01/TTS issued with this Circular;

– Appendix detailing the individual property lessees (applicable to organizations filing on behalf of individuals leasing property) according to mẫu số 01-2/BK-TTS issued with this Circular;

– A copy of the lease agreement, or any contract addendum (if this is the first tax declaration for the lease agreement or addendum). The tax authorities have the right to request the original document for verification and confirmation of its accuracy.

c) Tax return documents for organizations and individuals filing and paying taxes on behalf of individuals authorized by civil law shall be prepared according to the regulations applicable to the authorized individual if they directly file the tax return.

d) When a business or economic organization files tax returns on behalf of an individual renting out property, the option "Business or economic organization filing tax returns and paying taxes on behalf of an individual in accordance with tax laws" must be selected on the tax return form. The person filing must sign and clearly state their full name. If it is an organization filing on behalf of an individual, after signing, the organization's seal must be affixed or electronically signed as required. The tax assessment records and tax payment documents must show that the taxpayer is an organization filing and paying taxes on behalf of the individual.

2. Where to file tax returns

a) The place for submitting tax returns for organizations that file and pay taxes on behalf of individuals, as stipulated in Clause 1, Article 45 of the Law on Tax Administration, is the tax authority that directly manages the organization. However, in the case where an organization or individual files and pays taxes on behalf of an individual with income from renting real estate in Vietnam, the tax return must be submitted to the tax authority that directly manages the location of the rented real estate.

b) The place for filing tax returns for individuals who file and pay taxes on behalf of individuals authorized by civil law shall follow the regulations applicable to the authorized individual if they file the tax return directly.

3. Deadline for filing tax returns

The deadline for filing tax returns for organizations that file and pay taxes on behalf of individuals is stipulated in Clauses 1 and 3 of Article 44 of the Law on Tax Administration, specifically as follows:

a) The deadline for filing tax returns for organizations and individuals filing or paying taxes on behalf of individuals in the case of monthly or quarterly filing is as follows:

a.1) Organizations and individuals who file tax returns or pay taxes on behalf of individuals, and who are required to file tax returns monthly, must submit their tax returns no later than the 20th day of the month immediately following the month in which the obligation to file or pay taxes on behalf of another person arises.

a.2) Organizations and individuals who file tax returns or pay taxes on behalf of individuals, and who file tax returns quarterly, must submit their tax returns no later than the last day of the first month of the quarter immediately following the quarter in which the obligation to file or pay taxes on behalf of another person arises.

b) Deadline for submitting tax returns for organizations and individuals filing and paying taxes on behalf of individuals renting out property.

b.1) Organizations that file and pay taxes on behalf of others shall file tax returns monthly or quarterly as guided in point a of this section.

b.2) Organizations and individuals filing tax returns and paying taxes on behalf of others shall submit tax return documents for each payment period no later than the 10th day from the start date of the lease term for that payment period.

b.3) Organizations and individuals filing or paying taxes on behalf of others must submit their annual tax return by the last day of the first month following the end of the calendar year.

4. Tax payment deadline

The deadline for tax payment by organizations and individuals as guided in this Article shall comply with the provisions of Clause 1, Article 55 of the Law on Tax Administration, specifically: The deadline for tax payment is no later than the last day of the deadline for submitting tax declarations. In the case of supplementary tax declarations, the deadline for tax payment is the deadline for submitting the tax declaration for the tax period containing errors or omissions.

Chapter IV

RESPONSIBILITIES OF TAX AUTHORITIES IN TAX MANAGEMENT FOR HOUSEHOLD BUSINESSES AND INDIVIDUAL BUSINESSES

Article 17. Responsibilities of the General Department of Taxation

1. Develop a set of risk criteria indicators for household businesses and individual business owners.

2. Detailed instructions on the process of updating the database of household businesses and individual business owners at the Tax Department and Tax Sub-departments.

3. Directing the inspection and supervision of tax authorities and taxpayers in the implementation of tax policies and tax management for household businesses and individual businesses.

4. Implement electronic invoices with tax authority codes for household businesses and individual businesses according to the prescribed roadmap. Coordinate with the People's Committees of provinces and cities to deploy the electronic invoice project generated from cash registers with data transfer connections to the tax authority. Build a database of invoices with tax authority codes to ensure effective risk-based tax management for household businesses, individual businesses, and related organizations and individuals.

Article 18. Responsibilities of the Tax Department

1. Direct, guide, and supervise the Tax Sub-department in managing taxes for household businesses and individual business owners.

2. Direct, guide, and supervise the construction of separate databases at each Tax Sub-department to serve as a basis for determining the revenue and tax rates of business households and individual business owners paying taxes using the lump-sum method in each locality.

3. Develop a plan for inspecting the Tax Department and taxpayers regarding the implementation of tax policies and tax management for household businesses and individual business owners.

4. Implement and report to the General Department of Taxation the results of the inspection plan for tax branches and taxpayers. The specific implementation of the inspection plan is as follows:

a) The Tax Department is responsible for conducting annual on-site inspections of at least 10% of the Tax Sub-departments in accordance with risk management regulations regarding the determination of projected revenue and projected tax amounts. The inspection results from the Tax Department will serve as one of the bases for the Tax Sub-departments to prepare and approve the Tax Register for Taxpayers under the Contractual Tax System.

b) In the implementation of tax collection tasks, the Tax Department is responsible for conducting periodic on-site inspections of at least 5% of the Tax Sub-departments in each of the first, second, and third quarters. The inspection results will serve as the basis for developing the projected revenue and tax estimates for the following year and for adjusting the revenue and tax estimates for the remaining period of the tax year.

c) The content of the on-site inspection by the Tax Department includes: inspection based on management databases; comparison of business registration and tax registration data; on-site inspection of at least 2% of business households, individual businesses, and related organizations in the area, focusing on inspecting 100% of business households and individual businesses that are subject to high-risk management as prescribed.

5. Implement the approval and public disclosure of information on lump-sum tax payments on the tax authority's website to ensure transparency, enhance the monitoring capacity of citizens and local agencies and departments.

Article 19. Responsibilities of the Tax Department

In addition to carrying out regular tax collection tasks, the Tax Department is also responsible for managing household businesses and individual businesses as follows:

1. Disseminate information and provide support to household businesses and individual business owners in filing tax returns, submitting tax returns, paying taxes, and accessing publicly available information about household businesses and individual business owners as prescribed by regulations.

2. Implement the procedure for determining revenue and tax rates for household businesses and individual business owners paying taxes under the lump-sum method as guided in Article 13 of this Circular, including the following main tasks: determining revenue and lump-sum tax rates; publicly posting information on household businesses and individual business owners paying taxes under the lump-sum method; consulting with the Tax Advisory Council; preparing and approving the Tax Register; adjusting revenue and lump-sum tax rates in case household businesses and individual business owners change their production and business activities; and conducting surveys of revenue of household businesses and individual business owners paying taxes under the lump-sum method.

3. Conduct periodic, planned inspections at the tax office headquarters based on the database of business households, individual businesses, and related organizations. For high-risk cases with signs of violations, conduct inspections at the taxpayer's premises to promptly detect and prevent violations of tax laws and tax management regulations.

4. Establish a separate database at each Tax Sub-department for tax management of household businesses and individual businesses, and finalize the database by November 1st of each year to serve as the basis for compiling the lump-sum tax register for the following year. The separate database will be built on information from: tax declaration files of household businesses and individual businesses; actual tax collection data for household businesses and individual businesses; results of annual business revenue surveys conducted by the tax authorities; results of annual on-site inspections of revenue and lump-sum tax calculations conducted by the tax authorities; information from relevant state management agencies; the actual situation in the locality, economic growth rate in the region, factors affecting state budget revenue collection in the locality, etc.

5. Report to the Chairman of the People's Committee to direct local agencies and departments to coordinate with the tax authorities in managing taxes for business households and individual businesses in the area.

6. Coordinate with tax authorities in other localities in the inspection, control, verification, and provision of information on household businesses and individual businesses.

Chapter V

ORGANIZATION OF IMPLEMENTATION

Article 20. Enforcement

1. This Circular takes effect from October 1, 2021.

2. In cases where individuals have entered into multi-year property lease contracts and have declared and paid taxes according to previous regulations, no adjustments will be made to the taxes already declared and paid under regulations prior to the effective date of this Circular.

3. The notification of the deadline for paying lump-sum taxes for 2021 shall be carried out in accordance with the regulations in effect before the effective date of this Circular until the end of the 2021 tax period.

4. Household businesses and individual business owners who meet the conditions for paying taxes using the declaration method, if the tax authorities have been managing their taxes using the lump-sum method before the effective date of this Circular and there is no requirement to change the tax calculation method, shall continue to pay taxes using the lump-sum method until the end of the 2021 tax period.

5. Organizations that file and pay taxes on behalf of lump-sum taxpayers as stipulated in point d, clause 5, Article 7 of Government Decree No. 126/2020/ND-CP dated October 19, 2020, shall carry out the filing and payment of taxes on behalf of lump-sum taxpayers according to the guidance in this Circular from the effective date of this Circular.

6. Chapters I and II of Circular No. 92/2015/TT-BTC dated June 15, 2015, of the Ministry of Finance, guiding the implementation of value-added tax and personal income tax for resident individuals engaged in business activities, and guiding the implementation of some amendments and additions to personal income tax as stipulated in Law No. 71/2014/QH13 amending and supplementing a number of articles of the Laws on taxation and Decree No. 12/2015/NĐ-CP dated February 12, 2015, of the Government detailing the implementation of the Law amending and supplementing a number of articles of the Laws on taxation and amending and supplementing a number of articles of the Decrees on taxation, are hereby repealed.

During the implementation process, if any difficulties arise, organizations and individuals are requested to promptly report them to the Ministry of Finance (General Department of Taxation) for consideration and resolution.

APPENDIX I

LIST OF BUSINESS SECTORS SUBJECT TO VALUE ADDED TAX (VAT) AND PERSONAL INCOME TAX (PIT) AS A PERCENTAGE OF REVENUE FOR HOUSEHOLD BUSINESSES AND INDIVIDUAL BUSINESSES

(Issued together with Circular No. 40/2021/TT-BTC dated October 01, 2021 of the Minister of Finance)