Particulars Of Laws On Private Revenue Tax Refund In Vietnam – Tax

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The personal income tax refund is a problematic issue

for most employees that have a high income. Although the amount of

money refunded might not be much, it is the right of each employee

in Vietnam’s society. So, what are the details of regulations

on personal income tax refunds in Vietnam?

Personal income tax refund

Refund of personal income tax is the procedure by which the tax

authority refunds the overpaid tax amount of a taxpayer (in the

final settlement year).

Nonetheless, it should be noted that the personal income tax

refund can only be conducted if the employees fully comply with the

regulations of the tax law.

Regulations on the refund of personal income tax

According to article 23 of Circular 92/2015/TT-BTC, the

conditions for personal income tax refunds are as follows:

Refund of personal income tax is only applicable to individuals

who already have a tax identification number at the time of

requesting a tax refund.

For individuals who have authorized tax settlement for

organizations or individuals to make the final settlement, the

individual’s tax refund shall be conducted through those

organizations or individuals.

If an individual directly settles the personal income tax refund

in Vietnam, if he/she has an overpaid tax amount, he/she shall be

entitled to a tax refund, or the amount of money will be reserved

for the next period of calculating payable personal income tax.

Tax refund for income-paying organizations and

individuals that make settlements on behalf of individuals

authorized to make tax finalization

In case income-paying organizations and individuals after

offsetting the overpaid or underpaid tax amount of individuals and

has an overpaid tax amount, if the individual who is subjected to

personal income tax required the tax agency to refund the overpaid

tax amount, income-paying organizations and individuals shall file

the tax refund dossier to the tax agency.

Tax refund for individuals earning incomes from salaries

or wages that they themselves directly settle taxes with tax

authorities

If there is an overpaid tax amount, the individual is not

required to submit a tax refund dossier, but only needs to write

the tax amount requested for the refund.

The amount of overpaid tax can be transferred to the

taxpayer’s account or it can be reserved for the following

period of personal income settlement. This is according to the

choice of the individual who is subjected to personal income

tax.

Calculating the overpaid personal income tax amount to be

refunded

If the taxpayer wants to know if they have paid excess or

insufficient personal income tax this year, they must make a final

settlement. Individuals can make a final settlement in one of two

forms: Do the final settlement directly with the tax agency or

authorize an income-paying agency (if eligible).

The formula for calculating overpaid Personal income tax amount

is as follows:

Overpaid PIT amount = Paid PIT amount –

PIT payable according to tax settlement

If the result of this formula is positive, it is an overpaid

amount, and the taxpayer can ask for a refund of the excessive

amount.

On the other hand, if the result is negative, it is an underpaid

amount, and the taxpayer will have to pay the difference amount to

the tax agency.

After businesses or individuals carry out the PIT refund

calculation and figure out the amount needed to be refunded, they

need to submit their PIT refund dossiers to the tax agency.

After receiving the refund dossier, within 06 working days from

the date of receipt of complete tax refund dossiers, tax agencies

are responsible for handling PIT refund procedures according to

Clause 3, Article 58 of Circular No. 156/2013/TT-BTC.

If the subjects of inspection are under the group following the

‘inspection first, tax refund later’, the tax agency will

have 40 working days from the date of receipt of the PIT refund

dossier to finish the PIT refund procedures.

The content of this article is intended to provide a general

guide to the subject matter. Specialist advice should be sought

about your specific circumstances.

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