With the development of information technology, online sales are gradually becoming an inevitable trend, applied by many individuals and businesses in their business activities. Therefore, the issue of how much the state tax online business is one of the hot topics, which is researched deeply and thoroughly by everyone, updated daily. To get the most accurate information, follow the information that will be shared in our article below.

1. In which cases does the state tax online business?

Currently, the state taxes online business in the following cases:

Case 1: Individuals doing business online spontaneously, without a physical store, without a business registration. In this case, the individual doing business must register a tax code according to form No. 3-DK-TCT (this declaration form is issued with Circular 105/2020/TT-BTC) to declare taxes

Case 2: Individuals or organizations doing business online have a physical store, registered to do business in the form of an enterprise or a business household. For each form, the state will tax online business in accordance with regulations, and at the same time, individuals/organizations have the obligation and responsibility to complete the declaration procedures and pay taxes in full.

Thus, it can be said that when doing business online, whether it is a spontaneous activity or an activity in the form of an enterprise or a business household, the state will tax online business. The amount of tax payable and what types of taxes must be paid depend on each specific case.

2. How much online sales revenue is subject to online business tax?

According to Article 4 of Circular 40/2021/TT-BTC, individuals and organizations doing online business with revenue from online sales activities of VND 100,000,000/year or more will be responsible for paying both personal income tax and value added tax. On the contrary, if the revenue from online sales activities is less than VND 100,000,000/year, the seller will not have to pay these two taxes.

And as we have shared above, individuals and organizations doing online business will have to fully comply with the regulations on tax declaration, ensure the accuracy, completeness and honesty of tax records as well as submit records on time. This helps them avoid violations of the law and be responsible before the law.

3. Taxes that must be declared and paid when selling online

When taxing online business, the state will require individuals and organizations doing online business to pay 4 types of taxes: Business license fee, personal income tax (PIT) and value added tax (VAT) and corporate income tax (if individuals/organizations sell online under the business model)

3.1. Business license fee

Business license fee is the first type of tax when the state taxes online business. This tax will be calculated based on annual revenue. Accordingly, online sellers will pay business license fee annually.

According to Article 4 of Decree 139/2016/ND – CP, business license fee for online business activities is as follows:

3.2. Personal income tax and value added tax

Personal income tax and value added tax are two types of taxes that must be mentioned when talking about online business taxation. The specific calculation of personal income tax and value added tax is as follows:

• Personal income tax payable = Taxable revenue for personal income tax * Personal income tax rate
• VAT payable = Taxable revenue for VAT * Value added tax rate

In which:

• VAT rate is 1% of total revenue, PIT rate is 0.5% of total revenue
• PIT taxable revenue and VAT taxable revenue will include the total value of sales and other expenses. In cases where taxpayers use invoices from tax authorities, taxable revenue will be determined based on the taxable revenue and the revenue recorded on the invoice.
• In cases where individuals and business organizations cannot determine taxable revenue or determine it incorrectly, the tax authority will decide the tax rate that the seller must pay.

3.3 Corporate income tax

Corporate income tax is a type of tax that the state will require online businesses to pay when they do business in the form of an enterprise. This type of tax will be calculated based on the income or profit of the enterprise after deducting reasonable expenses.

4. Procedures for declaring online business tax in Vietnam

In order for the state to tax online business, making your business activities legal, business people need to carry out tax declaration procedures. During the procedure, individuals and businesses need to prepare the following documents:

• Tax registration form 03-DK-TCT
• Copy of business registration certificate without notarization
• Copy of ID card, citizen identification card or passport without notarization

After receiving the personal tax code, you must notify the e-commerce site according to the following instructions:

Step 1: Access the website thuedientu.gdt.gov.vn, then select the “INDIVIDUAL” section.

Step 2: On the website canhan.gdt.gov.vn, select the “Login” section.

Step 3: Enter the tax code and confirmation code in the login box.

Step 4: Enter the password from the SMS to access the electronic tax declaration system, then select “Login”.

Step 5: After successfully logging in, select the “Tax declaration” tab, select the “Form 01/CNKD” declaration, select the declaration form (monthly or quarterly), then select “Continue”.

Step 6: On the 01/CNKD declaration screen, select “HKD, CNKD pay tax according to the declaration method”, then declare full information.

Step 7: Select 01-2/BK – HDKD, select “Continue”, then select “Accept”. If you do not see this form, click “Options” to add an appendix.

Step 8: After completing the business activity list, select “Complete declaration”.

Step 9: Check the information again, select “Submit declaration” and “Continue”.

Step 10: Enter the OTP code received from the system, select “Continue”. The screen will display the message “Successful declaration submission”

After completing these 10 steps, you have completed the tax declaration procedure. During the declaration process on the portal, if you have any questions about the content that needs to be filled in, please ask the tax authority staff immediately to avoid incorrect filling or declaration.

5. What is the penalty for late payment of online business tax or late tax declaration?

When the state has imposed online business tax on individuals and online business organizations, it means that the seller must be responsible for paying fully and on time. If the online business person pays tax late, he will be fined according to the provisions of the law. Even if the seller declares tax late, he will be fined.

5.1 Late tax declaration

If individuals and organizations do not declare taxes or declare taxes late, the process of taxing online businesses will encounter many difficulties. According to the provisions of Article 13, Decree 125/2020/ND-CP, the penalty for violations regarding the time of submitting tax declarations is as follows:

5.2 Late tax payment

In any case, if you pay online business tax late, you will be fined according to the provisions of law. The fine is stipulated in Clause 2, Article 59 of the Law on Tax Administration 2019:

• The late payment fee is 0.03%/day, calculated on the amount of late tax payment
• The late payment fee calculation period will be calculated continuously from the day following the date of late payment to the day before the taxpayer transfers the late payment to the state budget.

The above is the most detailed information about online business taxation in Vietnam today that VIET MY LAW AND ACCOUNTING wants to share with readers. If you have any questions about this topic, do not hesitate to call the hotline number or leave a comment below this article!