NEW REGULATIONS ON PERSONAL INCOME TAX REFUND ACCORDING TO THE TAX MANAGEMENT LAW 2019

What are the regulations on tax refund documents according to the Tax Management Law 2019? Which of the tax refund cases are you in? What documents do you need to prepare for tax refund? Under what conditions does the taxpayer get a personal income tax refund? TASCO Tax agent will clarify these issues clearly in the article below.

The annual personal income tax finalization is a hot issue that needs to be resolved for individuals who generate taxable income during the year. For taxpayers who are eligible for tax refund after performing the calculation, they need to know the following regulations in order to complete the finalization process and receive tax refund.

1. Tax refund cases:

     ♦ According to Article 70,71 of the Tax Management Law 2019, specifically as follows:

+ Tax refund for organizations and individuals eligible for tax refund according to the regulations of tax law.

+ Taxpayers whose amount paid to the state budget is larger than the amount payable to the state budget.

     ♦ Taxpayers eligible for tax refund mentioned above prepare and send tax refund documents to competent tax management department.

     ♦ Tax refund documents include:

+ Text request for tax refund

+ Documents related to tax refund request

     ♦ How to submit tax refund documents:

+ Submit the application directly at the tax management department.

+ Send documents by post

+ Send electronic documents through the electronic transaction portal of the tax management department.

2. Tax refund documents classification:

Within 3 working days from the date of receipt of the tax refund documents, the tax management department classify the documents and notify to the taxpayer of the acceptance of the documents and the time limit for processing the tax refund documents or notify the taxpayer by document in case the documents is incomplete.

The documents are classified into those subject to inspection before refund and those subject to refund before inspection.

✔️ Documents subject to inspection before refund include:

1️⃣ The taxpayer's documents of the first request for tax refund of each tax refund case according to the regulations of tax law.

+ In case a taxpayer submits a tax refund documents to the tax management department for the first time but is not eligible for tax refund as prescribed by law, the next request for tax refund will still be considered as the first request for tax refund;

2️⃣ The taxpayer's dossier of request for tax refund within 2 years from the time of being handled for tax evasion;

3️⃣ Documents of dissolved enterprise, business bankruptcy, terminate operations, sell, hand over and transfer state enterprises;

4️⃣ Tax refund documents belong to the category of high tax risk according to the risk management classification in tax management;

5️⃣ The tax refund documents belong to the case of early tax refund but the time limit expires according to the text notification of the tax management department, but the taxpayer fails to explain or complete the tax refund documents or gives explanation or completion the tax refund documents but cannot prove that the declared tax amount is correct;

6️⃣ Tax refund documents for exported and imported goods which payment was not made through commercial banks or other credit organizations as prescribed by law;

7️⃣ Tax refund documents for exported and imported goods subject to inspection before tax refund according to the Government's regulations.

✔️ Documents subject to tax refund before inspection:

According to the provisions of Clause 3, Article 73 of the Law on Tax Management 2019:

"Documents eligible for tax refund before inspection is documents of a taxpayer that does not belong to the case specified in Clause 2 of this Article"

Thus, the documents subject to tax refund before inspection are all the remaining documents that do not belong to the cases of the documents subject to inspection before tax refund.

3. Location for checking tax refund documents:

According to Article 74 of the Law on Tax Management 2019, the following provisions are made:

💥 Documents eligible for tax refund should be checked at the head office of the tax management department

💥 Documents subject to inspection before tax refund inspection are checked at the taxpayer's headquarter or at the headquarter of relevant agencies, organizations or individuals.

4. Time limit for processing tax refund documents:

According to Article 74 of the Law on Tax Management 2019, the following provisions are made:

✔️ For documents subject to tax refund before inspection:

Within 6 days from the date the tax management department issues acceptance notification of the documents.

In case the information declared on the tax refund documents is different from the information available to the tax management department, the tax management department will notify the taxpayer for explanation and additional information. The time to explain and completion information is not included in the time limit for processing tax refund documents.

✔️ For documents subject to inspection before tax refund include:

-  No later than 40 days from the date the tax management department gives a text notification of the acceptance of the documents and the time limit for processing the tax refund documents.

– Tax management department must decide to refund tax to taxpayers or not if the documents is not eligible for tax refund.

✔️ In case the time limit is exceeded:

– If the delay in issuing the tax refund decision is due to the tax management department’s fault, in addition to the tax amount to be refunded, the tax management department must also pay interest at the rate of 0.03%/day calculated on the payable amount and the number of days of late payment.

- The source of interest payment should be spent from the central budget in accordance with the law on state budget.

If you have questions about the regulations on personal income tax or personal income tax refund or have a need to use personal income tax finalization service, please contact TASCO Tax Agent immediately, we will support you to fulfill your obligations to state authorities fully and quickly with super economical and reasonable service fees. For more details, please see the article below:

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