Công văn 1010/TCT/TNCN

To: Provincial/municipal Departments of Taxation

The General Department of Taxation has recently received official letters of some local Departments of Taxation reporting on a number of problems in the course of declaration and finalization of income tax on high-income earners (personal income tax) and the refund of personal income tax. Concerning this matters, the General Department of Taxation hereby provides additional specific guidance on the following points:

1. Regarding tax finalization in 2004:

- Individuals liable to make tax finalization directly at tax offices shall make tax declarations and finalization according to form No. 08/TNTX (promulgated together with the Finance Ministry's Circular No. 12/2005/TT-BTC of February 4, 2005). In cases where individuals make monthly tax payments directly at the State Treasury and the tax offices have not yet issued tax receipts, they shall write the phrase "budget remittance papers" in the column "receipts" of the section for detailed declaration of monthly incomes from which tax has been withheld according to tax withholding receipts (Part II, Section A) of declaration form No. 08/TNTX, in order to reflect tax amounts already remitted into the state budget.

- When making tax finalization declarations according to form No. 08/TNTX, taxpayers being Vietnamese who, in the tax finalization year, worked and earned incomes both in Vietnam and overseas, shall add the detailed list of days they worked overseas (according to dates of exit and entry stated in their passports).

- Regarding tax finalization declarations made according to form No. 10/TNTX, the Tax Departments shall have to guide income-paying agencies to make detailed declarations of payable tax amounts, tax amount already withheld in the year and tax amounts to be paid (norms 4, 5 and 6 of Section I) for Vietnamese and foreign income earners (based on lists made according to form No.11/TNTX) so as to serve the entry of data into computers.

2. Regarding tax refund:

- Where individuals compiled dossiers for tax refund in 2004 and earned taxable incomes in 2004 from which tax has been withheld but their income-paying agencies delayed the issuance of tax withholding receipts or vouchers to them until early 2005, or where individuals earned their incomes in late 2004 but paid tax into the state budget via the State Treasury in January 2005 and the state budget remittance receipts, vouchers or papers clearly indicate tax withheld or paid for incomes earned in 2004, such vouchers shall also serve as a basis for consideration of 2004 tax refund to such individuals.

- Regarding payment vouchers of tax refund: Where individuals eligible for tax refund have no accounts at banks or the State Treasury and fail to compile authorised payment vouchers (under the guidance provided in the General Department of Taxation's Official Letter No. 477-TCT/TNCN of February 4, 2005 regarding the refund of income tax on high-income earners), the Tax Departments shall bill checks for cash payment to tax-refunded individuals according to regulations, enclosed with tax refund decisions, so that such individuals can receive cash directly at the State Treasury.

3. Regarding the enhancement of tax management:

Recently, the management of income tax on high-income earners has seen a marked progress, especially the collection of tax from singers and artists: By the end of the first quarter of 2005, over 150 singers and artists being high-income earners have presented themselves at tax offices for tax declaration instructions. In some localities, local People's Committees have issued directives on enhancement of tax withholding activities and management of incomes. The Culture and Information Ministry also issued on March 7, 2005 Official Letter No. 655/VHTT-KHTC to direct activities in this domain.

In order to enhance the management of collection of personal income tax, the General Department of Taxation requests the Tax Departments to:

- Continue propagation among, mobilization of, and provide specific guidance to, taxpayers on registration of tax identification numbers, income declaration and tax finalization; and commend organizations and individuals that have well performed the tax withholding, declaration and payment.

- Urge the submission of, and sum up declarations for 2004 personal income tax finalization of income-paying agencies and individuals, in order to determine tax amounts to be refunded and tax arrears.

- Promptly refund tax and concurrently apply coercive measures against subjects that fail to abide by law.

- Intensify coordination with central and local agencies, branches and concerned agencies in managing taxable incomes, thus ensuring the fair collection of personal income tax.

- Expand the inspection of fulfillment of the obligation to withhold, declare and finalize personal income tax by income-paying agencies.

- Continue organizing the tax collection and finalization for taxable income earners such as: models, actors/actresses and other subjects.

The General Department of Taxation notifies the above guidance to the Tax Departments for knowledge and implementation. Any problems arising in the course of implementation should be reported by concerned units to the General Department of Taxation for timely application of handling measures.