Cases of tax collection
According to the 2019 Tax Administration Law, tax collection is the act of taxpayers being not punished because the statute of limitations for handling administrative violations has expired but still having to pay the full amount of the remaining tax. Even if no longer punished, the obligation to pay the full amount of tax that has been declared incorrectly, owed back or enjoyed incorrect incentives is still clearly established by law.
Pursuant to the Law on Tax Administration 2019 and Decree 125/2020/ND-CP, the tax authority will collect in the following cases:
The amount of tax payment is lacking;
The amount of tax exempted, reduced, or refunded is higher than the prescribed level;
Tax evasion amount;
Funds for late tax payment within the prescribed time.
Incorrect declaration leads to collection obligations
According to Clause 1, Article 142 of the Law on Tax Administration 2019, taxpayers may be subject to collection in the following cases of incorrect declaration:
Incorrectly opening the basis for calculating taxes or the amount of tax deducted or determining incorrect cases of tax exemption, reduction, and refund, leading to a shortage of tax payable or an increase in the amount of tax exempted, reduced, and refunded, but economic operations have been fully reflected in the accounting system, on legal invoices and documents;
Taxpayers have prepared a file to determine market prices or have prepared a linked transaction declaration, but when inspecting and checking, the tax authority or competent authority determines that the inspection and examination data is different from the declared data of the taxpayer, leading to a shortage of tax payable or an increase in tax exemption, reduction, and refund;
Using illegal invoices and documents, using illegal invoices to account for the value of purchased goods and services reduces the amount of tax payable or increases the amount of tax exempted, reduced, or refunded, but the buyer of goods and services using illegal invoices and documents proves that the violation of using illegal invoices belongs to the seller.
Cases of late payment fees
Clause 1, Article 59 of the Law on Tax Administration 2019 determines the cases that must pay late payment fees as follows:
Taxpayers who are late in paying compared to the prescribed deadline, extension period or according to the notice of the tax authority;
Taxpayers who self-declare additional tax obligations or are found to have short-declarations during inspection and examination;
Opening additional documents to reduce the amount of tax that has been refunded, or if the competent authority discovers an incorrect refund, it must pay late payment fees calculated from the date of receipt of the incorrect refund;
In case of permission to gradually pay tax arrears according to the approved plan;
Tax collection due to incorrect declaration, tax evasion or under-payment;
In case of incorrect declaration, the tax rate will be exempted, reduced, or refunded;
Units authorized to collect late payment to the state budget of taxes, late payment fees, and fines must pay late payment fees corresponding to the late payment fees.
Mechanism for collecting information to serve the verification of tax evasion acts
Article 121 of the 2019 Tax Administration Law clearly stipulates the authority and responsibility in collecting information related to tax evasion:
The head of the tax authority has the right to request relevant agencies, organizations and individuals to provide information in writing or respond directly;
In case of written request, the requested party is obliged to respond correctly to the content, on time, and be responsible for accuracy. If it cannot be provided, a written response must be provided stating the reason;
In case of direct response, the person requested must be present at the right time and location, and be responsible for the content provided. In case of absence, the provision of information must be done in writing;
For the form of direct collection, members of the inspection team must make a working record, and record and record publicly to ensure transparency.
