Vietnam Extends VAT, CIT, PIT, and Land Rent Deadlines

Businesses in Vietnam will receive temporary tax relief as the deadlines for value added tax, corporate income tax, personal income tax, and land rent have been extended. For foreign firms operating in Vietnam, it’s important to understand the implications of this tax break and how it may impact their business operations.

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Vietnam has announced the extension of tax deadlines on several taxes due in 2023. This policy adjustment is designed to give the business community a much needed respite in the backdrop of the current global economic uncertainty.

A similar policy was implemented during the COVID-19 pandemic to offer businesses some flexibility in managing their cash flow effectively and stay afloat amid the economic disruption.

This article will delve into the latest decree and outline its scope, the eligible parties entitled to tax relief, the revised deadlines, and the necessary steps that businesses must take to avail of these tax deadline extensions.

By providing this information, we aim to assist businesses in navigating the updated regulations and making informed decisions.

What does the Decree cover?

Decree 12/2023/ND-CP outlines extensions to due dates on Vietnam’s value added tax (VAT), corporate income tax (CIT), personal income tax (PIT), and land rent.

Who will these extensions impact?

The tax deadline extensions issued April 14 will affect a number of key stakeholders. These include:

• Taxpayers;
• Tax authorities; and
• Tax officials; and
• Other relevant state agencies, organizations and individuals.

Who is eligible for a tax deadline extension?

Entities eligible for tax deadline extensions include most organizations and individuals conducting business in Vietnam. This includes enterprises in:

• Agriculture, forestry and fishery;
• Food production and processing;
• Construction;
• Manufacture of beverages;
• Drainage and wastewater treatment;
• Warehousing transportation;
• Accommodation and catering services;
• Education and training; health and social assistance activities; and
• Real estate business.

Note: This list is by no means exhaustive and interested parties should refer to the law to determine eligibility for their unique situation. For more information, the Vietnam Business Advisory team at Dezan Shira & Associates can be reached on: vietnam@dezshira.com

What are the new tax deadlines?

New tax deadlines will apply as follows:

Value added tax

For monthly VAT declarations from:

• March to May of 2023, the deadline is extended by six months
• For June, the deadline is extended by five months; and
• For July, the deadline is extended by four months.

For quarterly VAT declarations from:

• the first quarter of 2023, the deadline is extended by six months; and
• the second quarter of 2023, the deadline is extended by five months.

Corporate income tax

The CIT deadlines for the first and second quarters of 2023 will each be extended by three months from their original due dates.

Value added tax and personal income tax for business households and individuals

VAT and PIT for business households and individuals will be extended to December 30 if their activities fit within the scope of the law.

Land rent

For the first 50 percent of the land rent payment due in 2023 the deadline is extended by six months, from May 31, 2023 to November 30, 2023.

How to access the tax deadline extensions

To access these tax deadline extensions, tax payers need to lodge an application for extension. This must be submitted by September 30, 2023.

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