The deadline for PIT finalization may be extended

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The implementation of regulations on PIT finalization, existing shortcomings to be amended soon. Photo TL.

According to the current regulations on PIT finalization, individuals with only one income source shall deduct at the source and authorize the finalization through a paying organization. Individuals with two or more income sources must directly make tax finalization with the tax office if they have additional payable tax amounts or overpaid tax amounts requested for refund.

According to the General Department of Taxation, the implementation of regulations on PIT finalization have some shortcomings that still exist, and are to be amended soon. For example, for an individual with one income source, the tax finalization authorized for the paying organization is the sum of the net income received by 31 December and the actual deductions in a year, and deducted tax amount in a year. The tax declaration deadline of December or the fourth quarter also falls at the end of January next year. At this time, paying organizations can compile a detailed list of months / quarters in a year to be sent to the tax office with tax declaration returns for the last month, last quarter and do not need to make PIT finalization. Therefore, if regulation on PIT finalization by paying organizations is removed, the administrative procedures for enterprises will be reduced.

For individuals with two or more income sources, they must make direct finalization with tax offices. General Department of Taxation said that although the number of individuals directly finalizing their tax only accounts for 0.01%, the number of dossiers is very large (more than 100,000 dossiers) and focuses on two big cities Hanoi and Ho Chi Minh.

According to the current regulations, the deadline for organizations and individuals falls on 31st March every year, which often overloads the tax office in receiving and processing the finalization dossiers, annoying taxpayers. In addition, due to insufficient data from enterprises, the database of Tax sector does not support individuals to look up incomes before making tax finalization as well as lacking database to handle the PIT refund so as avoiding risks in reimbursement.

In the proposal to develop a revised Law on Tax Administration, the Ministry of Finance said that to reform the PIT finalization in the aim of reducing administrative procedures, assisting taxpayers to compile their income in a year before tax finalization and to minimize risks in PIT refunds, the Law on tax administration should amend the period of PIT finalization within 120 days from the last day of the calendar year (extended one month more than the period for an enterprise).

The regulation on removing the PIT finalization for paying organizations will be prescribed at the level of sub-law document.

Enterprises have proactively finalized tax report soon VCN –March every year is the peak season for the tax finalization report for individual and enterprises. ...

As a result, the revised Law on tax administration will amend and supplement the deadline and place for submitting PIT declaration return in the direction of prolonging one month more than the deadline for enterprises.