LEGAL UPDATES VOL.04
JUNE, 2021
Dear Valued Customers and Partners,
ADK Lawyers Law Firm would like to introduce to you the Legal Updates Vol.04 (June 2021) with new legal provisions effective from June, 2021, with notable contents as follows:
1. Implement of eligible entities for Corporate preferential tax (CPT) from June 4, 2021 according to Decree 58/2021/ND-CP.
According to Article 1 of Decree 58/2021/ND-CP, point g, Clause 2, Article 20 of Decree No. 218/2013/ND-CP on CIT of projects producing supporting industry products was issued on On June 4, 2021, eligible enterprises for CPT include enterprises with new investment projects or investment in expanding production of products on the List of supporting industrial products prioritized for development, conducted before January 1, 2015.
In addition, these enterprises need to meet the conditions of the supporting industry product production project as prescribed in the Law of amending tax laws 2014 and be granted a certificate of preference by the competent authority. production of supporting industry products is entitled to corporate income tax incentives.
2. Continue to extend due date for payment of value added tax, corporate income tax, personal income tax and land rent in 2021.
On April 19, 2021, the Government issued Decree 52/2021 allowing some subjects to extend the due date for paying value added tax, corporate income tax, personal income tax and land rent in the year 2021 including enterprises, organizations, business households and individuals engaged in production activities in the following economic sectors:
(i) Agriculture, forestry and fisheries;
(ii) Food production and processing; weaving; production of costumes; manufacture of leather and related products; wood processing and production of products from wood, bamboo and cork (except for beds, cabinets, tables and chairs); produce products from straw, straw and plaiting materials; production of paper and paper products; manufacturing products from rubber and plastic; manufacture of other non-metallic mineral products; metal production; mechanical; metal treatment and coating; manufacturing electronic products, computers and optical products; manufacture of automobiles and other motor vehicles; manufacture beds, cabinets, tables, chairs;
(iii) Construction;
(iv) Publishing activities; cinematographic activities, television program production, sound recording and music publishing;
(v) Exploiting crude oil and natural gas (without extension for CPT on crude oil, condensate, natural gas collected under agreements, contracts);
(vi) Manufacture of beverages; print, copy records of all kinds; production of coke, refined petroleum products; manufacture of chemicals and chemical products; manufacture of products from prefabricated metal (except for machinery and equipment); manufacture of motorcycles and motorbikes; repair, maintenance and installation of machinery and equipment;
(vii) Drainage and wastewater treatment;
(viii) Transportation and warehousing; accommodation and catering services; education and training; health and social assistance activities; real estate business;
(ix) Labor and employment service activities; activities of travel agencies, tour businesses and support services, related to the promotion and organization of tours;
(x) Creative, artistic and entertainment activities; activities of libraries, archives, museums and other cultural activities; sports and entertainment activities; movie screening activities;
(xi) Radio and television activities; computer programming, consulting services and other computer-related activities; information service activities;
(xii) Mining support service activities;
(xiii) Enterprises, organizations, business households and individuals engaged in production of supporting industry products prioritized for development; key mechanical products;
(xiv) Small and micro enterprises defined in accordance with the provisions of the Law on Supporting Small and Medium Enterprises 2017 and Decree 39/2018/ND-CP;
(xv) Credit institutions, foreign bank branches implement solutions to support customers being businesses, organizations and individuals affected by the COVID-19 epidemic in accordance with regulations of the SB of Vietnam.
- Extension of payment of value added tax (except value added tax at the stage of importation):
Extension of the tax payment due date for the incurred expense of value-added tax paid (including amount of tax allocated to other provincial-level localities where the taxpayer is headquartered, the tax amount paid each time it is incurred) ) of the tax period from March to August 2021 (for the case of monthly VAT declaration) and the tax period of the first quarter, the second quarter of 2021 (for the case of VAT declaration). quarterly increase) of businesses and organizations.
The extension period is 05 months for the amount of value-added tax from March to June 2021 and the first quarter, the second quarter of 2021, the extension period is 04 months for the amount of value-added tax of July in 2021, the extension period is 03 months for the amount of value added tax of August 2021.
The extension time is counted from the end of the time limit for payment of value added tax in accordance with the law on tax administration.
- Extension of time to pay corporate income tax:
Extension of the tax payment due date for the amount of corporate income tax temporarily paid of the first quarter and the second quarter of the 2021 corporate income tax period of the enterprises and organizations mentioned above.
The extension is 3 months from the end of the time limit for paying corporate income tax in accordance with the law on tax administration.
- Extension of payment of value added tax and personal income tax of business households and individuals:
Extension of time limit for payment of value added tax and personal income tax for the amount of tax payable in 2021 of business households and individuals operating in the economic sectors and fields mentioned in items list from (i) to (xiii) above.
Business households and individuals shall pay the extended amount of tax in this Clause by December 31, 2021.
- Extension of land rental payment:
Extension of the time limit for paying land rent for the land rent payable in the first period of 2021 of enterprises, organizations, business households and individuals that are subject to the above-said regulations and are directly leased land by the State Decision or Contract of a competent state agency in the form of annual land rental payment.
The extension period is 6 months from May 31, 2021.
3. Principles of handling by the State Bank (SB) when credit institutions fail to pay refinancing loans on time.
Starting from April 5, 2021, Circular 04/2021/TT-NN on Regulations on refinancing of credit institutions after credit institutions lend loans to Vietnam Airlines Corporation - JSC The rescheduling of the repayment term, keeping the debt group unchanged, and setting up risk provisions for the debts of Vietnam Airlines Corporation - JSC due to the impact of the COVID-19 pandemic have officially been applied.
Accordingly, for failure of credit institutions’ failure of paying refinancing loans on time, the SB will take the following measures:
(i) In case the credit institution fails to repay the refinancing loan on time when the refinance loan is due (the refinancing period expires and the refinancing extension (if any) is over), the SB shall transfer the principal amount of the refinancing loan to the bank. provide capital that is not paid on time to overdue monitoring according to the regulations of the SB on methods of calculating and accounting for the collection and payment of interest in deposit receipt and lending activities between the SB and credit institutions and other organizations; apply an interest rate on overdue refinanced principal equal to 150% of the refinancing interest rate announced by the SB from time to time at the time the refinance is transferred overdue for the amount of the refinanced principal failure to pay debt on time from the day following the day the credit institution has to pay to the date the credit institution pays off the amount of nonpayment on time.
(ii) In case the credit institution fails to repay the loan on time, which is 03 working days from the date of arising, the principal balance of the refinanced loan is larger than the principal balance of the VNA loan corresponding to the refinancing loan, the SB shall apply an interest rate equal to 150% of the refinancing interest rate announced by the SB from time to time from the day following the date the credit institution must pay for the principal amount of the refinancing loan that fails to repay on time, within the period from the day following the date the credit institution has to pay to the date the credit institution pays off the amount of nonpayment on time..
(iii) The SB shall deduct the credit institution's deposit account at the SB to recover all the amount payable by the credit institution, including the unpaid refinancing loan principal and interest rate as stated at items (i) and (ii) from the next working day:
a. The date of transferring the principal amount of the refinancing loan to monitoring overdue, in case when the credit institution fails to repay the loan on time as specified in item (i);
b. The date that the SB Transaction Office receives a written notice from the Banking Inspection and Supervision Agency about the credit institution's violations within 03 working days from the date of detecting the credit institution's failure to pay debt refinancing, in case when the credit institution fails to repay the debt on time in item (ii).
We hope you found this brief legal update informative.
Best regards.
