Regulations on Extension for Filing Tax Returns for Enterprises in Vietnam
Compliance with tax regulations is one of the essential obligations of businesses in their operations. However, in practice, there are unforeseen circumstances that may prevent businesses from submitting their tax returns on time. Understanding the regulations on tax return filing extensions can help businesses avoid legal risks and protect their rights. This article provides detailed information on the cases eligible for an extension, the extension period, procedures, and important considerations regarding tax return filing extensions.
1. Cases Eligible for Tax Return Filing Extension
According to the law, businesses may be granted an extension for filing tax returns under specific circumstances:
1.1. Natural Disasters, Fires, and Unexpected Accidents
If a business is affected by natural disasters such as storms, floods, earthquakes, or encounters fires or unexpected accidents, which prevent it from submitting tax returns on time, the business has the right to request an extension. These are situations beyond the business’s control and can cause significant damage to assets, facilities, and business operations.
1.2. Organizational Restructuring
When a business is undergoing restructuring, division, separation, consolidation, merger, or dissolution, it may face difficulties in submitting tax returns due to the associated administrative procedures. In these cases, the business can also request an extension for filing tax returns to ensure compliance with legal regulations.
1.3. Technical Issues
With the advancement of information technology, electronic tax return filing has become common. However, in some cases, the electronic tax filing system may encounter technical issues or malfunctions, leading to the business being unable to file tax returns on time. In such situations, the business can apply for an extension to fulfill its tax obligations.
1.4. National Emergency or Epidemic Situation
Factors such as epidemics, natural disasters, or national emergencies can severely impact the business’s operations. For example, during the COVID-19 pandemic, many businesses faced difficulties in maintaining normal operations. In such situations, the government often introduces support policies, including tax return filing extensions, to help businesses overcome difficult periods.
2. Tax Return Filing Extension Period
The extension period for tax return filing is not indefinite but has specific durations to ensure strict management by tax authorities and compliance by businesses.
2.1. Basic Extension Period
Typically, the extension period for filing tax returns does not exceed 60 days from the original tax return filing deadline. This period allows businesses to temporarily address difficulties and complete the tax return filing.
2.2. Special Cases
In some special cases, businesses may request an additional extension period. However, such extensions must comply with specific regulations of the tax authority, and the business needs to provide sufficient reasons and necessary supporting documents.
3. Procedures for Requesting a Tax Return Filing Extension
To request a tax return filing extension, businesses must follow the prescribed procedures, which include preparing and submitting the application and waiting for the tax authority to review it.
3.1. Application for Extension
The application for an extension includes a request form for a tax return filing extension, along with any supporting documents proving the reasons for the request (if applicable). The request form must clearly state the reason and the requested extension period and be verified by relevant authorities, such as the People’s Committee at the commune level or the police department of the commune, ward, or town where the case occurs.
3.2. Submitting the Application
Businesses can submit the extension request directly to the managing tax authority, by mail, or through the electronic tax filing system. The choice of submission method depends on the specific conditions of the business and the actual situation.
3.3. Application Processing
After receiving the extension request, the tax authority will review and respond in writing within five working days. If the application is complete and the reason is valid, the tax authority will grant the extension. Conversely, if the application does not meet the requirements, the tax authority will provide a clear explanation for the denial, allowing the business to adjust or supplement the application promptly.
4. Important Considerations
When requesting a tax return filing extension, businesses should pay attention to several important points to avoid legal risks and ensure compliance with the regulations.
4.1. Extension for Filing Tax Returns Does Not Mean Extension for Paying Taxes
An extension for filing tax returns only applies to the submission of tax return documents, not to the payment of taxes. Therefore, businesses must still fulfill their tax payment obligations within the stipulated deadlines to avoid penalties for late tax payments.
4.2. Not Applicable to Cases Already Penalized
An extension for filing tax returns does not apply to cases where the business has already been penalized for administrative violations of tax laws. If the business has been penalized, the extension request will not be accepted, and the business must take corrective measures as prescribed by law.
4.3. Regular Updates on New Legal Documents
Tax regulations may change over time. Therefore, businesses need to regularly update the latest legal documents or consult tax experts to ensure compliance with current laws.
5. Legal Basis and Penalties for Late Submission of Tax Returns
5.1. Legal Basis
The regulations on tax return filing extensions are clearly stipulated in the Law on Tax Administration 2019 and Decree No. 125/2020/ND-CP. These are important legal foundations for businesses to comply with tax regulations.
5.2. Penalties for Late Submission of Tax Returns in 2024
If businesses submit tax returns late, penalties will be applied depending on the delay period and the severity of the violation:
- 1 to 30 days late: A fine of VND 2,000,000 to VND 5,000,000.
- 31 to 60 days late: A fine of VND 5,000,000 to VND 8,000,000.
- 61 to 90 days late: A fine of VND 8,000,000 to VND 15,000,000.
- Over 90 days late without tax payment obligations: A fine of VND 8,000,000 to VND 15,000,000.
- Over 90 days late with tax payment obligations and full payment of tax, late payment interest to the state budget: A fine of VND 15,000,000 to VND 25,000,000.
The specific penalty will be applied depending on the type of tax, the violation case, and the amount of tax underpaid. Besides fines, late tax return submissions may result in additional administrative measures according to the law.
6. Conclusion
Extending the tax return filing period is an important measure to help businesses overcome temporary difficulties and comply with legal regulations. However, businesses need to understand the conditions, procedures, and deadlines for extensions to avoid unnecessary penalties. Additionally, regularly updating tax regulations ensures that businesses meet their tax obligations as required by law.
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