I. Legal basis

The Tax Administration Law 2019 has established an important legal framework for tax administration, clearly defining the responsibilities of organizations and individuals in declaring and paying taxes. According to this law, individuals are obliged to declare their income and pay personal income tax (PIT) on time. To accomplish this, Decree 126/2020/ND-CP specifically guides procedures and regulations related to tax obligations, emphasizing the importance of transparency and accuracy in reports. tax.

In addition, Official Dispatch 636/TCT-DNNN provides detailed instructions on the personal income tax finalization process. In this official dispatch, the tax authority emphasized that individuals need to carefully check relevant documents and invoices to ensure that all declared information is accurate and valid, to avoid errors. errors in the settlement process.

In addition, Circular 80/2021/TT-BTC also provides detailed regulations on the implementation of personal income tax finalization obligations, clarifying the conditions and regulations on family deductions as well as exempt incomes. tax. This provides greater clarity for individuals in declaring and paying taxes, especially in a context of frequently changing regulations.

To ensure the 2025 PIT finalization process goes smoothly and avoid unnecessary risks, individuals need to pay attention to a number of important issues. First of all, income declaration must be done accurately and completely, ensuring that all income is recorded. In addition, individuals need to carefully check and store relevant documents and invoices so that they can be presented when necessary.

The deadline for submitting final settlement documents is also an important factor that individuals need to understand. Late submission of documents can lead to fines, so it is necessary to pay attention to the specified time. In addition, family deductions and non-taxable income also need to be carefully considered to optimize the amount of tax payable.

Finally, if individuals do not comply with the above regulations, they can face a fine of up to 25 million VND as prescribed in Decree 125/2020/ND-CP. Therefore, understanding the regulations and properly fulfilling tax obligations is extremely necessary to protect your rights and avoid unnecessary legal risks.

II. When is the deadline for submitting personal income tax finalization?

The deadline for submitting personal income tax finalization is an important factor that individuals need to pay attention to in order to fulfill their tax obligations on time. For annual tax finalization documents, the deadline for submission is the last day of the third month from the end of the calendar year or fiscal year. 

For individuals who directly finalize personal income tax, finalization documents need to be submitted no later than the last day of the fourth month from the end of the calendar year. For business households and individuals paying taxes using the presumptive method, the tax declaration submission deadline is December 15 of the preceding year.

Specifically, the deadline for declaring and finalizing personal income tax for income received in 2024 will be specified as follows. If an individual has income from salary and authorizes tax finalization to the organization or individual paying the income, the tax finalization deadline will be March 31, 2025. In case the individual has income from salary and Directly settle personal income tax with the tax authority, this deadline will be April 30, 2025. Understanding these deadlines helps individuals fulfill tax obligations accurately and avoid problems. legal no necessary.

III. Who must make personal income tax finalization?

Personal income tax finalization is an obligation that many subjects must perform, including organizations and individuals paying salaries and wages. For employees who have signed a contract with a term of three months or more and are working at the workplace, personal income tax finalization can be authorized to the organization or individual paying the income. enter.

In addition, individuals who directly settle accounts with tax authorities also need to pay attention to certain criteria. Specifically, these individuals include those who have tax amounts payable or overpaid and request a refund or offset in the next tax declaration period. However, in cases where the tax amount payable after finalization of each year is less than 50,000 VND or the tax payable is less than the established tax without requiring a tax refund or offset in the next period, settlement will not be required.

In addition, individuals who are present in Vietnam for less than 183 days in the first calendar year or for 183 days or more within 12 consecutive months from the first day of presence in Vietnam are also subject to compliance. tax settlement. In particular, for foreigners, they also need to finalize taxes before leaving the country after their work contract ends in Vietnam. Understanding the subjects and regulations related to tax finalization will help individuals and organizations properly fulfill their responsibilities under the law.

IV. Penalty for Late Personal Income Finalization

When individuals or organizations do not finalize personal income on time, they may face sanctions. Penalties can include warnings or fines, with a minimum fine of 2 million VND and a maximum fine of up to 25 million VND.

Specifically, a warning penalty will apply to cases where tax declarations are submitted 1 to 5 days beyond the deadline and there are extenuating circumstances. If the application is submitted 1 to 30 days late, the fine will range from 2 million to 5 million VND. For late submission of documents from 31 to 60 days, the fine will increase from 5 million to 8 million VND.

When the application is submitted 61 to 90 days late, the fine will range from 8 million to 15 million VND. Penalties in this range include submitting documents that are 61 to 90 days overdue, submitting documents that are 91 days or more overdue but do not generate tax payable, or not submitting tax declaration documents and not tax payable arises. In addition, failure to submit appendices according to tax administration regulations is also penalized in this framework.

Finally, if the tax declaration is overdue for more than 90 days and a tax liability arises, the fine will range from 15 million to 25 million VND. In addition to fines, late tax payment will also incur interest at the rate of 0.03% per day on the late tax amount. This means that the late payment fee for one day will be 0.05% of the late payment amount. These regulations are intended to ensure the serious and timely implementation of tax obligations.

• Late payment interest rate = 0.03%/day calculated on the late payment tax amount
• 1 day late payment = 0,05% x Amount of late payment

V. What does a personal income tax finalization file include?

Personal income tax (PIT) finalization documents are an important part of the process of fulfilling an individual’s tax obligations. For individuals who make direct settlement with tax authorities, the dossier needs to include a number of essential documents. First, individuals need to submit a personal income tax finalization declaration according to form 02/QTT-TNCN. In addition, the appendix of the list of family deductions for dependents must also be attached, using form 02-1/BK-QTT-TNCN.

To prove the amount of tax deducted or temporarily paid during the year, individuals need to provide copies of relevant documents. If there is tax paid abroad, this document should also be attached. A copy of the Tax Deduction Certificate and invoices and documents related to contributions to charity funds, humanitarian funds or study promotion funds are also indispensable components in the settlement documents. Finally, if an individual receives income from international organizations, Embassies or Consulates, documents proving the amount paid by this unit or organization are required.

For personal income tax finalization dossiers of organizations and individuals paying income, the tax finalization declaration will use form 05/QTT-TNCN. In addition, the appendix lists details of individuals subject to tax calculation according to the partially progressive schedule (form 05-1/BK-QTT-TNCN) and the appendix lists details of individuals subject to tax calculation according to tax rates. The full form (form 05-2/BK-QTT-TNCN) also needs to be submitted. Finally, the organization must also provide an appendix with a detailed list of dependents to reduce family circumstances, using form 05-3/BK-QTT-TNCN. These documents help tax authorities accurately check and confirm individuals’ tax obligations.

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