| THE MINISTRY OF FINANCE -------- | SOCIALIST REPUBLIC OF VIETNAM Independence - Freedom - Happiness --------------- |
| No. 140/2012/TT-BTC | Hanoi, August 21, 2012 |
CIRCULAR
GUIDING THE GOVERNMENT'S DECREE NO. 60/2012/NĐ-CP DATED JULY 30, 2012, DETAILING THE IMPLEMENTATION OF THE NATIONAL ASSEMBLY’S RESOLUTION NO. 29/2012/QH13 PROMULGATING A NUMBER OF TAX POLICIES TO HELP ORGANIZATIONS AND INDIVIDUALS RESOLVE THEIR DIFFICULTIES
Pursuant to the Law on Tax administration No. 78/2006/QH11 dated November 29, 2006.
Pursuant to the Law on Personal income tax No. 04/2007/QH12 dated November 21, 2007;
Pursuant to the Law on Value-added tax No. 13/2008/QH12 dated June 03, 2008;
Pursuant to the Law on Enterprise income tax No. 14/2008/QH12 dated June 03, 2008;
Pursuant to the National Assembly’s Resolution No. 29/2012/QH13 dated June 21, 2012 promulgating a number of tax policies to help organizations and individuals resolve their difficulties
Pursuant to the Government's Decree No. 60/2012/NĐ-CP dated July 30, 2012, detailing the implementation of the National Assembly’s Resolution No. 29/2012/QH13 promulgating a number of tax policies to help organizations and individuals resolve their difficulties;
Pursuant to the Government's Decree No. 118/2008/NĐ-CP dated November 27, 2008 on defining the functions, tasks, powers and organizational structure of the Ministry of Finance;
At the proposal of the Director of the General Department of Taxation;
The Minister of Finance promulgates the Circular guiding the Government's Decree No. 60/2012/NĐ-CP dated July 30, 2012, detailing the implementation of the National Assembly’s Resolution No. 29/2012/QH13 promulgating a number of tax policies to help organizations and individuals resolve their difficulties;
Chapter I
ENTERPRISE INCOME TAX
Article 1. Enterprise income tax reduction
1. Reducing 30% enterprise income tax in 2012 for:
a) Medium and small enterprises, including cooperatives (hereinafter referred to as medium and small enterprises).
a) Intensive-labor enterprises that produce or process agricultural products, forestry products, aquatic products, textile and garment, leather and footwear, electronic components, or build socio-economic infrastructure (hereinafter referred to as intensive-labor enterprises).
2. The medium and small enterprises prescribed in Point a Clause 1 this Article are enterprises that satisfy the standards of capital or labor as prescribed in Clause 1 Article 3 of the Government's Decree No. 56/2009/NĐ-CP dated June 30, 2009 of development support for medium and small enterprises.
a) The amount of capital for calculating the reduction of the enterprise income tax amount payable in 2012 of medium and small enterprises is the total capital shown in the Balance sheet made on December 31, 2011 of the enterprise. For enterprises of which the tax period in the fiscal year 2011 is different from the calendar year, the amount of capital for calculating the reduction of the enterprise income tax amount payable in 2012 of medium and small enterprises is the total capital shown in the Balance sheet made on the last day of the tax period in the fiscal year.
For medium and small enterprises established on January 01, 2012 or later, the amount of capital for calculating the reduction of the enterprise income tax amount payable in 2012 of medium and small enterprises is the charter capital written in the Enterprise registration certificate or the First investment certificate.
b) The annual average number of employees (including the employee of the branches and affiliated units) for determining whether the enterprise is eligible for tax reduction prescribed in Point a Clause 1 this Article is the total number of employees that the enterprise regularly employs in 2011, excluding employees signing short-term contracts under 3 months
The annual average number of regular employees is calculated as guided in the Circular No. 40/2009/TT-BLĐTBXH dated December 03, 2012 of the Ministry of Labor, War Invalids and Social Affairs, on guiding the calculation of the number of regular employees as prescribed in the Government's Decree No. 108/2006/NĐ-CP dated September 22, 2006 on detailing and guiding the implementation of a number of articles of the Law on investment.
For the enterprises established on January 01, 2012 and later, the total number of employees, excluding employees signing short-term contracts under 3 months, is the average number of regular employees from the date of establishment until December 31, 2012.
c) For enterprises engaged in various sectors, the determination of whether they are medium and small enterprises to determine the capital or labor criteria as prescribed in the Decree No. 56/2009/NĐ-CP is based on the primary business line written in their Enterprise registration certificates. If the primary business line is not determined, one of the following criteria shall apply to determine its primary business line:
- The highest number of employees in each business of the enterprise in 2011; or
- The highest revenue in each business of the enterprise in 2011.
If the primary business line is not determined after applying the criteria above, it is required to take apply the criteria for capital or the lowest number of employees of the business line in the business lines that the enterprise engages in 2011 as prescribed in Clause 1 Article 3 of the Decree No. 56/2009/NĐ-CP.
d) For enterprises following the model of parent companies – subsidiary companies that the parent companies are not medium and small enterprises holding more than 50% equity capital of subsidiary companies, if subsidiary companies are able to satisfy the capital or labor criteria prescribed in Clause 1 Article 3 of the Decree No. 56/2009/NĐ-CP, and do not engage in the business lines ineligible for tax reductions, they are also eligible for 30% reduction of the enterprise income tax payable in 2012.
3. Intensive-labor enterprises (including the employees of branches and affiliated units) that engage in the business lines eligible for tax reduction guided in Point b Clause 1 this Article include:
a) Enterprises established before January 01, 2012, of which the annual average number of regular employees in 2012 is over 300 people, excluding employees signing short-term contracts under 3 months.
The annual average number of regular employees is calculated as guided in the Circular No. 40/2009/TT-BLĐTBXH dated December 03, 2012 of the Ministry of Labor, War Invalids and Social Affairs, on guiding the calculation of the number of regular employees as prescribed in the Government's Decree No. 108/2006/NĐ-CP dated September 22, 2006 on detailing and guiding the implementation of a number of articles of the Law on investment.
For the enterprises established on January 01, 2012 and later, the total number of employees, excluding employees signing short-term contracts under 3 months, is the average number of regular employees over 300 people from the date of establishment until December 31, 2012.
For enterprises following the model of parent companies – subsidiary companies, the number of employees for determining whether the parent company is eligible for tax reduction does not include the number of employees of subsidiary companies, and vice versa.
b) The reduced enterprise income tax is the tax on the income of the production and processing of agricultural products, forestry products, aquatic products, textile and garment, leather and footwear, electronic components, or the construction of socio-economic infrastructure.
c) The production and processing of agricultural products, forestry products, aquatic products, textile and garment, leather and footwear (including leather shoes and slippers), electronic components are identified according to the Vietnam’s system of business lines, promulgated together with the Prime Minister’s Decision No. 10/2007/QĐ-TTg dated January 23, 2007.
d) The construction of socio-economic infrastructure includes the construction and installation of water plants, power plants, electricity distribution and transmission constructions, water supply and drainage system; roads, railroads, airports, sea ports, river ports, train stations, bus stations, schools, hospitals, cultural houses, cinemas, art performance centers, sports stadiums, sewage and solid waste treatment systems, communication constructions, irrigation serving agriculture, forestry and fishery.
4. Enterprise income tax reduction prescribed in Point a Clause 1 this Article is not applicable to the following subjects:
a) Medium and small enterprises engaged in lottery, real estate, securities, finance, banking, insurance, production and provision of goods and services subject to special excise duty.
Medium and small enterprises engages in various business lines, the enterprise income tax reduce does not include the tax on the income from the business of lottery, real estate, securities, finance, banking, insurance, production and provision of goods and services subject to special excise duty.
b) Enterprises ranked among the class I as prescribed in the Circular No. 23/2005/TTLT-BLĐTBXH-BTC dated August 31, 2005 by the Ministry of Labor, War Invalids and Social Affairs and the Ministry of Finance guiding the rating and salaries of members of the Board of Directors, General Directors, Directors, Deputy General Directors, Deputy Directors, Chief accountants of State-owned companies.
c) Enterprises ranked among the Special class under the Prime Minister’s Decision No. 185/TTg dated March 28, 1996 on Special-class State-owned enterprises, and the Prime Minister’s Decision No. 186/TTg dated March 28, 1996 of the list of Special-class State-owned enterprises.
d) Economic organizations being non-business units.
Article 2. Enterprise income tax exemption
The enterprise income tax payable in 2012 on the income from doing catering for workers by catering enterprises.
Article 3. Conditions for enterprise income tax reduction and exemption
1. Enterprises and organizations eligible for tax exemption and reduction as prescribed in Article 1 and Article 2 of this Circular are units being legally established and run under Vietnam’s law, following the regulations on accounting and invoices, and paying tax according to the declaration.
2. For enterprises enjoying enterprise income tax incentives as prescribed by the Law on Enterprise income tax or legal documents on enterprise income tax, the reduced enterprise income tax prescribed in Article 1 of this Circular is calculated on the remaining amount of enterprise income tax after deducting the amount enterprise income tax eligible for incentives as prescribed.
3. Enterprises, organizations doing catering for workers are eligible for tax exemption as prescribed in Article 2 of this Circular must commit to keep the catering prices during 2012 not higher than the prices in December 2011. If competent agencies find that the enterprise or organizations does not implement their commitment, they will be no longer eligible for tax exemption as prescribed in Article 2 of this Circular.
If an enterprise doing catering for workers also a medium or small enterprise that is both eligible for 30% reduction of the enterprise income tax payable in 2012 as prescribed in Point a Clause 1 Article 1 of this Circular, and eligible for the exemption of the enterprise income tax in 2012 on the income from the provision of catering services for workers, the enterprise may choose the most beneficial tax incentive.
Article 4. Determination of the tax amount reduced and exempted
1. Enterprises and organizations must separately record the incomes from the production or business eligible for the exemption and reduction of enterprise income tax, and the production or business ineligible for the exemption and reduction of enterprise income tax. If the income from the activities eligible for tax exemption and reduction is not identifiable, the income for calculating the tax reduced or exempted is calculated on the ratio (%) of the income from the activities eligible for tax exemption and reduction to the total income of the enterprise or organization in 2012.
2. The reduced enterprise income tax amount prescribed in Clause 1 Article 1 of this Circular is the enterprise income tax preliminarily calculated quarterly, and the outstanding difference of enterprise income tax payable under the tax finalization in 2012 of the enterprise compared to the total tax amount preliminarily calculated quarterly.
3. The exempted enterprise income tax amount prescribed in Article this Circular is calculated as follows:
a) In case the enterprise or organization can determine the receipts, expenses, and taxable income from the provision of catering services for workers in 2012, the exempted enterprise income tax in 2012 on catering for workers is calculated on the enterprise income tax amount payable in 2012 calculated by the enterprise or organization.
b) If in the tax period 2012, the enterprise or organization does not separate the income from doing catering for workers and the income from the production or business ineligible for tax incentives, the income eligible for tax exemption in 2012 equals the total taxable income from the production or business (excluding other incomes) multiplied by (x) the ratio (%) of the income from doing catering for workers to the total revenue of the enterprise or organization in 2012.
c) The exempted enterprise income tax on the income from doing catering for workers does not include the tax on the income from doing catering for transport and aviation enterprises to serve passengers, and the tax on the income from other business.
Article 5. Tax declaration
1. Enterprises and organizations eligible for tax exemption and reduction as prescribed in Article 1 and Article 2 of this Circular shall declare the reduced and exempted tax in accordance with the Law on Tax administration and its guiding documents.
Enterprises and organizations must make and send the Annex on enterprise income tax exemption and reduction (form No. 01/MGT-TNDN promulgated together with this Circular) to the direct tax authorities, specifying that the enterprise or organization is eligible for enterprise income tax exemption or reduction, and the reduced or exempted enterprise income tax amount. Declaring the total reduced and exempted tax in the item [31] on the declaration sheet No. 01A/TNDN, or the item [30] on the declaration sheet No. 01B/TNDN, or the item [C9] on the declaration sheet No. 03/TNDN (promulgated together with the Circular No. 28/2011/TT-BTC dated February 28, 2011 by the Ministry of Finance).
2. Enterprises and organizations that have make declaration as prescribed but have not made tax exemption and reduction declaration as prescribed in Article 1 and Article 2 of this Circular may make additional tax declaration.
If the enterprise or organization makes the additional declaration in Q1/2012 and Q2/2012, the additional declaration of enterprise income tax exemption and reduction including the preliminary declaration of enterprise income tax in Q1/2012 and Q2/2012 that has been added the reduced or exempted tax amount; the Annex of Enterprise income tax exemption and reduction in Q1/2012 and Q2/2012 stated above.
The additional tax declaration sheet is submit to tax authorities on any working day, not depending on the time limit for submitting the next tax declaration, but before the tax authorities or competent agencies announce the decision on carrying out tax inspection at the tax payer’s office.
3. If a enterprise eligible for tax reduction has declared and paid the reduced tax amount in Q1 and Q2/2012 to the State budget, such enterprise may deduct the reduced tax amount from the tax amount payable in Q3 and Q4/2012, and the difference payable according to the tax finalization in 2012. If the deduction is not complete after the tax finalization in 2012, the enterprise may request to deduct it from the amount payable in the succeeding year, or request tax refund as prescribed by the Law on Tax administration and its guiding documents.
4. If a enterprise eligible for tax exemption has declared and paid the reduced tax amount in Q1 and Q2/2012 to the State budget, such enterprise may deduct the exempted tax amount from the tax amount payable in Q3 and Q4/2012, and the difference payable according to the tax finalization in 2012 of other business. If the deduction is not complete after the tax finalization in 2012, the enterprise may request to deduct it from the amount payable in the succeeding year, or request tax refund as prescribed by the Law on Tax administration and its guiding documents
5. Settling the difference of the reduced enterprise income tax in the tax finalization compared to the preliminary calculation of the quarterly enterprise income tax declaration
a) When finalizing enterprise income tax in 2012, if the reduced enterprise income tax amount is larger than the total reduced tax amount preliminarily calculated in Q4, the enterprise is eligible for reducing the reduction of the difference amount between the reduced tax amount according to the tax finalization and the total reduced tax amount according to the preliminary calculation in Q4/2012.
b) When finalizing enterprise income tax in 2012, if the reduced enterprise income tax amount is smaller than the total reduced tax amount preliminarily calculated in Q4, reduce tax amount is calculated according to the tax finalization.
6. When competent agencies inspect and discover that the enterprise income tax during the tax exemption and reduction period prescribed in Article 1 and Article 2 of this Circular is larger than that declared by the unit (including enterprises and organizations eligible for enterprise income tax exemption and reduction prescribed in this Circular that have made declarations but have not determined the reduced or exempted enterprise income tax amount), the enterprises and organizations are eligible for the exemption and reduction of the enterprise income tax (including the additional enterprise income tax and the undetermined enterprise income tax amount eligible for tax exemption and reduction prescribed in this Circular).
When competent agencies inspect and discover that the enterprise income tax eligible for tax exemption and reduction as prescribed in Article 1 and Article 2 of this Circular is smaller than that declared by the unit, the enterprises and organizations are only eligible for the exemption and reduction of the enterprise income tax amount discovered during the inspection.
Competent agencies shall impose the sanctions against the violations of law provisions on tax depending on the seriousness of violations.
Chapter II
VALUE-ADDED TAX
Article 6. Exemption of flat value-added tax in 2012 for business households and individuals
1. Flat value-added tax in 2012 is exempted for:
a) Households and individuals renting houses and rooms to workers, employees, and students;
b) Households and individuals providing day care services;
c) Households and individuals doing catering for workers.
2. Conditions for tax exemption
Business households and individuals eligible for tax exemption as prescribed in Article 1 must satisfy the following conditions:
- Paying value-added tax at a flat rate;
- Committed to sustain the rents, day care charges, and catering charges in 2012 not exceeding that in December 2011. For business households and business individuals commencing their business in 2012, the rents, day care charges and catering charges must not exceed that in December 2011 of business households and individuals doing the same business in the same locality that have been operated before 2012.
- Publicly posting the rents, day care charges, and catering charges in the business establishments, and notify the local authorities and direct tax authorities before November 01, 2012 of the maintenance of the charges not exceeding that in December 2012 from January 01, 2012.
3. Depending on the approved Tax Register 2012, tax authorities must make and report the list of individuals and households leasing rooms, houses, providing day care, and doing catering for workers, and the exempted tax amount, to People’s Committees at the same level and the superior tax authorities for monitoring and inspecting. Posting it at the tax authorities office before November 15, 2012, and notify the business households and individuals.
