On the Ministry of Finance's Information Portal, reader L.T in Ninh Binh reflected that her company had signed labor contracts (labor contracts) with individuals.
This individual received the contract with a tax code and submitted a commitment form according to Form No. 08/CK-TNCN issued together with Circular No. 80/2021/TT-BTC.
In which, individuals commit to fully meeting the conditions according to regulations to temporarily not be deducted PIT.
Readers request the tax authority to guide the following contents: for payments under labor lease contracts or work assignment contracts to individuals mentioned above, do businesses have to deduct 10% PIT before payment?
In case individuals have submitted Form No. 08/CK-TNCN and fully meet the conditions specified in point i, clause 1, Article 25 of Circular No. 111/2013/TT-BTC, can businesses temporarily not deduct personal income tax when paying income?
What documents should be kept to serve as a basis for not deducting personal income tax?
Regarding this content, the tax authority in Ninh Binh said that based on point i, clause 1, Article 25 of Circular No. 111/2013/TT-BTC dated August 15, 2013 of the Ministry of Finance guiding the implementation of the Law on Personal Income Tax, the Law amending and supplementing a number of articles of the Law on Personal Income Tax and Decree No. 65/2013/ND-CP of the Government, in case organizations and individuals pay wages, remuneration or other expenses to resident individuals who do not sign labor contracts or sign labor contracts for less than 3 months, with a payment level of 2 million VND/time or more, they must deduct tax at a rate of 10% on income before payment.
However, in case an individual has only income subject to deduction at the 10% rate mentioned above, but estimates that the total taxable income after family deduction is not yet at the level to be taxed, the individual is allowed to make a commitment according to the form issued with the guiding document on tax management and send it to the income-paying organization as a temporary basis for not deducting personal income tax.
Based on the commitment of the income recipient, the income-paying organization does not deduct personal income tax.
At the end of the tax year, the income-paying organization must still summarize the list and income of individuals who have not reached the tax deduction level according to the prescribed form and submit it to the tax authority.
Individuals making commitments must register for tax and have a tax identification number at the time of making the commitment, and are responsible for the content of the commitment.
In case fraud is detected, it will be handled according to the provisions of law on tax management and relevant legal regulations.
