Understanding the difficulties in the process of paying tax and land rent of taxpayers while the economy is gradually recovering after the Covid-19 epidemic, the Government has issued Decree No. 34/2022/ND-CP (effective from May 28, 2022 to the end of December 31, 2022) on the extension of time limit for payment of value added tax (VAT), corporate income tax (CIT), personal income tax (PIT) and land rent in 2022.

Decree No. 34/2022/ND-CP has the following core provisions:

1) Eligible Subjects for Tax Payment Time Extension:

a) Enterprises, organizations, households, business households and individuals engaged in production and business activities in the economic sectors listed in Clauses 1 and 2, Article 3 of this Decree;

Note: The economic sectors mentioned in this Decree are determined according to the guidance on the list of economic sectors of Decision No. 27/2018/QD-TTg and regulations on economic sub-sectors according to Appendix I promulgated together with Decision No. 27/2018/QD-TTg.

b) Enterprises, organizations, households, business households and individuals engaged in production of supporting industry products prioritized for development (as determined by Decree No. 111/2015/ND-CP); key mechanical products (determined by Decision No. 319/QD-TTg).

Note: The economic sector and field of enterprises, organizations, households, business households or individuals specified at Points a and b above is the industry or field in which the enterprises, organizations, households, business households and individuals have production and business activities and generate revenue in 2021 or 2022.

c) Small and micro enterprises are defined according to the provisions of the Law on Supporting Small and Medium Enterprises 2017 and Decree No. 80/2021/ND-CP.

d) Credit institutions, foreign bank branches implement solutions to support customers being businesses, organizations and individuals affected by the Covid-19 epidemic in accordance with regulations of the State Bank of Vietnam.

2) Determining the Extension Period:

a) For VAT (except for VAT at the import stage): The payable VAT amount of the tax period from March to August 2022 and the tax period of the first quarter, the second quarter of 2022 is extended the payment time with separate extensions for each month/quarter. Specifically, after being extended, the deadline for monthly/quarterly VAT payment is extended as follows:

– March 2022 tax period: October 20, 2022.

– April 2022 tax period: November 20, 2022.

– May 2022 tax period: December 20, 2022.

– June 2022 tax period: December 20, 2022.

– July 2022 tax period: December 20, 2022.

– August 2022 tax period: December 20, 2022.

– First quarter of 2022: October 30, 2022.

– Second quarter of 2022: December 31, 2022.

b) For CIT: The extension is 3 months from the end of the time limit for paying corporate income tax in accordance with the law on tax administration for the temporarily paid corporate income tax amount of the first quarter and second quarter of the corporate income tax period of 2022.

c) For VAT and PIT of business households and individuals: The deadline for tax payment is December 30, 2022.

d) For land rent: The payment of 50% of the payable land rent in 2022 will be extended for 6 months (from May 31, 2022 to November 30, 2022) for enterprises and organizations, household, individual business household, subject to extension in Article 3 of this Decree who is being directly leased land by the State under a decision or contract of a competent state agency in the form of annual land rental payments.

3) Extension Order, Procedures, and Payment for Taxes and Land Rents: 

a) The taxpayer sends a written request for extension of payment of tax and land rent (made according to the form in the Appendix issued with this Decree) to the tax authority directly managing it. The payment is made only once for the entire tax and land rent amount arising in the extended tax periods together with the time of filing the tax return. In case the application for extension is not submitted at the same time as submitting the monthly (or quarterly) tax return, the deadline for submission is September 30, 2022. The application for extension of tax payment and land rent shall be replaced when errors are detected.

b) Taxpayers self-determine and take responsibility for the extension request to ensure the right beneficiaries under this Decree. If the taxpayer sends a written request for extension to the tax authority after September 30, 2022, the tax and land rent payment deadline shall not be extended as prescribed in this Decree.

c) The tax authority is not required to notify the taxpayer the acceptance of the extension to tax payment and land rent. If during the extension period, the tax authority has grounds to determine that the taxpayer is not subject to the extension, the tax authority shall send a written notice to the taxpayer of the non-renewal and taxpayers must pay the full amount of tax, land rent and late payment interest during the extension period into the state budget.

After the extension period expires, through inspection and examination by a competent state agency, it is discovered that the taxpayer is not eligible for the extension to pay tax and land rent according to the provisions of this Decree, taxpayers must pay the outstanding tax, fines and late payment interest to the state budget.

In addition to the above provisions, the Decree also provides guidance on not calculating late payment interest for the extended tax and land rent in some specific cases and detailed procedures for extending tax payment deadlines for entities, especially investors of capital construction works and work items with state budget capital in Clauses 4 and 5, Article 5.

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Note: This article is for informational purposes only and it is not a legal advice. The content of the article represents its own of TTVN Legal, it subject to change without prior notice.