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Tax Returns, Trade Union Contributions, Minimum Wages, & VAT Credits

Released at: 04:22, 20/03/2014 TAX CONSULT

Tax Returns, Trade Union Contributions, Minimum Wages, & VAT Credits

What are the recent updates on changing the standard tax return forms

Q: What are the recent updates on changing the standard tax return forms?

A: Pursuant to Circular No 156/2013/TT-BTC issued by the Ministry of Finance to replace Circular No 28 and provide guidance on the amended Law on Tax Administration and Decree No 83, from January 1, 2014 organisations and individuals declaring tax should use the new standard tax forms stipulated in the Circular for tax declaration purposes. If taxpayers discover any errors or misstatements in the annual tax finalisation dossiers they are required to lodge amendments to such dossiers. However, the Decree guides that such errors will be treated as if they were discovered by tax authorities.

Q: What is the new guidance on contributions to trade unions?

A: According to Decree No 191/2013/ND-CP effective from January 10, 2014, enterprises are required to pay trade union dues equivalent to 2 per cent of the total salary amount for social insurance contributions regardless of whether the entity has a trade union or not.

Enterprises are required to pay trade union dues in the same way they pay social insurance contributions, on a monthly basis. However, enterprises operating in certain fields such as agriculture, forestry, fisheries and salt production are allowed to pay such dues on a quarterly basis.

Q: What are the recent updates on regional minimum wage levels?

A: Circular No 33/2013/TT-BLDTBXH dated December 16, 2013 provides guidance on the implementation of regional minimum wage levels for the following cases.

Enterprises operating in adjacent areas with different regional minimum wage levels are required to apply the regional minimum wage levels for the area with the highest regional minimum wage levels. Enterprises with units or branches operating in different areas with different regional minimum wage levels are required to apply the regional minimum wage levels of such areas. From December 31, 2013 the new minimum wage levels are as follows:

Region I: VND2,700,000 ($128) /month

Region II: VND2,400,000 ($114) /month

Region III: VND2,100,000 ($100) /month

Region IV: VND1,900,000 ($90) /month

Q: What is the recent guidance on enterprises applying VAT credit methods?

A: According to Official letter No 17557/BTC-TCT, enterprises are required/allowed to apply the VAT credit method in the tax year 2014 if they meet either of the following conditions:

The revenue of the entity in 2013 is more than VND1 billion ($48,000);

The revenue of the entity in 2013 is less than VND1 billion ($48,000) but the entity has implemented all regimes on accounting, invoices and receipts and also sent a notice to tax authorities in relation to an application for the VAT credit method for fiscal year 2014.

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