What is flat tax?
In this article, TASCO will inform customers of the necessary information about the flat tax. If you have any questions that need to be answered, please contact TASCO Tax Agent for a completely free answer and consultation via hotline: 0975480868.
1. What is flat tax?
🔰 Tax is the main source of revenue for the State budget and has a very important meaning and position for each country. Today, when people's lives are more and more developed, access to the tax concept is more common and widespread. However, not all individuals, business households, or businesses are fully aware of all taxes.
🔰 The flat tax is also known as lump sum tax. A flat tax is usually applied to individuals and business households. This is a fixed tax for each individual, forcing each individual to pay the government the same amount regardless of their income, consumption, accumulation...
🔰 The flat tax rate is the tax and other state budget revenues payable by business households and individuals paying tax by the presumptive method determined by the tax authority according to the provisions of Article 51 of the Law on Tax Administration.
2. Features of a flat tax:
✔ Flat tax is a fixed value tax, levied on all business individuals.
✔ This is a tax that is relatively easy management, minimizing tax fraud due to levied on all business individuals, without discrimination objects.
✔ The flat tax rate is also a relatively low tax rate
✔ Each individual business household must pay tax at a certain rate based on the self-declared relative income.
✔ In addition, the flat tax applied to small and individual business households is relative because the flat tax rate is regulated by tax authorities, based on the revenue and size of the business household to determine the tax rate. suitable stock.
3. The objects of a flat tax:
🔗 Business individual means a resident individual, including individuals, groups of individuals, and households engaged in the production and trading of goods and services in all lines of production and business according to provisions of law
🔗 Business individuals with revenue > 100 million VND/year will need to pay a flat tax.
🔗 In addition, business individuals who are non-residents but have a fixed business location in the Vietnamese territory shall declare tax as if a business individual is a resident.
🔗 Business households and individuals that pay tax by the presumptive method are not required to comply with the accounting regime. Households using single invoices must store and present to tax authorities invoices, vouchers, contracts, and documents proving lawful goods and services when requesting for issuance and retail of invoices each time. incurred. Particularly in the case of contracting households doing business at border markets, border-gate markets, and markets in border-gate economic zones in the Vietnamese territory, they must store invoices, vouchers, contracts, and documents proving lawful goods and present them at the request of competent state management agencies.
🔗 Contracted households doing business for less than a full year (not full 12 months in a calendar year) include: contracted households that have just started doing business, contracted households that do regular seasonal business, and contracted households that stop or temporarily suspend their business. For a contracted household doing business for less than a full year, the revenue from 100 million VND/year or less to determine that the contracted household is not required to pay VAT or is not subject to PIT is the taxable revenue of a calendar year (12). month); The actual taxable turnover to determine the flat tax payable in the year is the revenue corresponding to the actual number of months of business.
🔗 Households with presumptive tax return according to the year specified at Point c, Clause 2, Article 44 of the Law on Tax Administration, and pay tax according to the deadline specified in the notice of payment of the tax authority according to the provisions of Clause 2, Article 55 of the Law on Tax Administration. In case the flat household uses invoices issued by the tax authority and retails them by number, the presumptive household shall declare and pay tax separately for the revenue generated on that invoice each time it is incurred.
4. Tax exemption and reduction cases:
✅ For individuals who stop/discontinue business:
▪️ In the case of individuals paying flat tax stops/discontinues their business, they shall notify the tax agency at least one day before the business cessation/discontinuation.
▪️ In the case of individuals paying flat tax taking a continuous leave of 01 (one) month (from the 1st to the last day of that month) or more, they are entitled to a 1/3 reduction of the payable flat tax amount of the quarter.
▪️ In case an individual takes 2 (two) months of continuous leave, they will be entitled to a 2/3 reduction of the payable flat tax amount for the quarter
▪️ In case an individual takes a full quarter off, they are entitled to a full reduction in the payable flat tax amount of the quarter.
▪️ In case the flat tax payer stops/leaves the business for less than a full month, the flat tax payable of the month is not reduced.
✅ For individuals suffering from natural disasters, fires, accidents, and fatal diseases:
▪️ These are force majeure situations that cannot be foreseen by business individuals, so the State has policies to support and help.
▪️ Time to send a written request for tax exemption (reduction), made according to Form No. 01/MGTH issued together with Circular No. 156/2013/TT-BTC, to the tax authority within 90 days from the end of the calendar year.
✅ For individuals who change the form of tax declaration:
▪️ If a business individual who is paying tax by the presumptive method has a request to change the form of tax declaration for each time it is incurred, the tax authority shall terminate the tax administration for the individual according to the presumption method and carry out procedures for reduction of flat tax according to the same instructions as for individuals who stop/leave their business as guided at point a, clause 11 of this article, for the number of months in which tax is not paid according to the presumptive method.
⇒ If you have any questions, please register here for TASCO's earliest advice or contact the hotline: 0975480868 (Zalo)
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