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Taxes payable after establishment of a company MUST be paid

Currently, after establishing a business, the company will have to pay taxes according to current regulations. We will mention the taxes payable after establishment of a company and we will guide you to calculate these taxes when paying!

1. What taxes need to be paid after establishing a company?

According to current legal regulations in 2023, taxes payable after establishment include the following taxes:

  • License fees
  • Business tax
  • Income Tax
  • V.a.t tax
  • Import and export tax
  • Resource tax
  • Special consumption tax

2. Tax procedures that need to be carried out after establishing a company

a. Open a bank account

After receiving the Company Registration Certificate, the company must open an account at a commercial bank or credit institution and notify the competent authority.

Open a bank account to make payments by bank transfer and electronic payment.

Records include:

  • Application form for opening an account according to the registering bank’s form;
  • 01 certified copy of Business Registration Certificate;
  • 01 copy of valid ID card or ID card or passport of the legal representative;
  • 01 certified copy of sample seal certificate.

After opening an account and being granted a bank account, the company must report this bank account to the Department of Planning and Investment.

b. Register for an electronic signature and pay taxes electronically

Businesses order digital signatures and register for use with organizations providing digital signature authentication services. Having an electronic digital signature has the same value as a business seal when paying taxes electronically.

Records include:

  • Notarized copy of the company’s registration certificate;
  • Copy of identity card or identification card of the company representative.

Register for Value Added Tax (VAT) calculation method:

  • According to the provisions of Clause 3, Article 3 of Circular 119/2014/TT-BTC, organizations specified in this Clause have the right to request implementation of VAT calculation method.
  • Enterprises send form No. 06/GTGT ​​to the tax authority to create a red invoice requesting to apply the withholding tax calculation method.

NOTE: Companies must register before the first tax filing deadline. If the above conditions are not met, applying the direct tax calculation method is automatic.

3. Instructions on how to calculate taxes payable after establishment of a company

Below are instructions on how to pay fees and taxes. After establishing a domestic company, you need to pay the taxes below.

3.1 Fees must be paid after establishing the company

License fees are paid annually or according to production and business based on the initial capital recorded in the business registration certificate, or investment capital recorded in the investment certificate (for organizations) or businesses. Annual revenue (for business households) This is the amount paid when a newly established business enters the market. paid and personal).

According to Decree 139/2016/ND-CP amended and supplemented by Decree 22/2020/ND-CP guiding the declaration and payment of natural resources tax:

The deadline for final tax declaration is the last day of the month of company establishment.

If the enterprise does not operate production or business activities, the deadline for submitting the license tax declaration is 30 days from the date of receiving the business registration certificate.

The tax rate is 2 million VND/year for companies with registered capital or investment capital of 10 billion VND or less and 3 million VND/year for companies with registered capital or investment capital of over 10 billion VND. 1 billion. Branches, representative offices, establishments, public service units, other economic organizations: 1,000,000 VND/year.

However, not all companies have to pay license fees. Some cases where companies are exempt from resource tax are listed in Article 3 of Decree 139/2016/ND-CP amended and supplemented by Decree 22/2020/ND-CP.

3.2 Taxes payable after establishment of a company

Taxes payable after establishment of a company
Taxes payable after establishment of a company

Corporate income tax

A tax based on the company’s final production and performance.

According to the amended and supplemented Enterprise Income Tax Law 2008 and the amended Enterprise Income Tax Law in 2013, 2014, the basis for calculating enterprise income tax is based on taxable income and tax rate.

Taxable income during the taxable period is taxable income minus non-taxable income and taxable loss from the previous year. Taxable income refers to sales revenue excluding expenses deducted from production and business activities plus other income, including income generated outside Vietnam.

  • The corporate tax rate is 22%.
  • A 20% tax rate applies to companies with a total annual turnover of VND 20 billion or less.
  • The corporate income tax rate applied to the search, exploration and development of oil, gas and other scarce resources in Vietnam ranges from 32% to 50% depending on the project and form of company establishment.

Value-added tax

Taxes are levied on the added value of goods and services from production, distribution to consumption.

According to the 2008 Law on Value Added Tax, amended and finalized in 2014, taxes were calculated using the deductible method and the direct method.

  • Deduction method: VAT = Output Value – Input Value
  • Direct method: VAT = VAT of goods x VAT of related goods.

The value-added tax rate of the company is 0%, 5%, and 10% depending on the specific type of goods and services of the company.

Personal income tax

Corporation taxes paid to employees are calculated on a monthly basis, determined on a monthly or quarterly basis, and calculated on a yearly basis.

The basis for calculating the personal income tax is taxable income and tax rate, where:

  • Income subject to personal income tax = Income subject to personal income tax- Reduce household circumstances.
  • Individual income tax rates are stipulated in sections 22 and 23 of the Income Tax Law 2007, amendments 2012, 2014

Tariffs on exports and imports

Applicable only to companies operating in the export-import sector, calculated by the following methods:

  • Calculate tax as a percentage based on the taxable price of each product and the tax rate at the time of tax calculation.
  • Calculate taxes on the absolute method and on the mixed method, the amount of taxes determined based on the actual amount of goods imported, imported and the absolute tax rate per unit of goods determined in Vietnam.

Resource tax

A tax, as specified in part 2009 of the Natural Resources Tax Act, 2009 has been amended and supplemented, only applied to companies engaged in natural resource extraction.

Based on tax calculations based on the income of taxable resources, taxable prices and tax rates.

Excise tax

The Special Consumption Tax Law of 2008 revised and supplemented in 2014 only applies to enterprises dealing in goods and services subject to special consumption.

  • The calculation of excise tax is based on the calculated price of excise tax and the amount of excise tax applied to the goods and services subject to taxation.
  • The amount of excise tax payable is equal to the price calculated by the excise tax multiplied by the excise tax.

4. Where do businesses pay taxes according to regulations?

Businesses can choose one of the following tax payment locations

  • Send money directly to the treasurer;
  • Pay taxes directly at the tax authority according to regulations;
  • Direct deposits to commercial banks and credit institutions;
  • Perform electronic transactions with digital signatures.

5. Frequently asked questions regarding taxes payable after establishing a company

5.1 Is permanent residence required to start a business?

Establishing a company is not based on the permanent residence of the founder, but entrepreneurs can establish a company in any province if they see a need to do business there.

5.2 How much capital can you start a business with?

According to the provisions of current company law, it is the company’s right to declare how much capital it is. The company declares and is responsible for the company’s share capital. In addition to activities requiring legal capital, enterprises must register capital levels according to the provisions of law, but cannot clearly state the capital source, but only ensure responsibility for the declared capital level and an appropriate deposit level. , governed by certain requirements.

5.3 What are the basic taxes that must be declared and paid after registration?

  • The license fee is paid fixedly according to the registered share capital (companies established in 2021 are exempt from business license fees);
  • VAT (paid only when accumulated);
  • Corporate income tax: usually 20% of profits, only paid if the company is profitable).

5.4 Does a company that has no income have to declare and pay taxes?

After establishing the company, although there is no income and expenses, the company does not have to pay taxes (except for license tax in the years after the first year of establishment), but every quarter the company must report: taxes:

VAT declaration: Companies that do not issue input or output invoices must still submit a VAT declaration before the tax declaration date. Regarding reporting on invoice usage: The company still has to report even if the company has not yet issued value-added invoices (if the company has completed procedures to notify the issuance of value-added invoices). Year-end financial statements: Companies need to note that even if the company has no business operations, it still must prepare and present year-end financial statements.

5.5 Can a company have more than one legal representative?

The law does not prohibit a person from representing two companies in a law firm, but only stipulates that a company may have one or more legal representatives. Therefore, the company owner can be the legal representative of many companies.

Above are detailed and complete regulations on taxes payable after establishing a company. Through the article, if readers still have any questions, please contact VIET MY LAW AND ACCOUNTING immediately, we will contact you and answer your questions as soon as possible. Best regards!

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Nguyen Thanh Phuc

Mr. Nguyen Thanh Phuc has more than 15 years of experience in business administration, consulting, legal support, tax and strategic consulting. Mr. Nguyen Thanh Phuc is a leading expert in the field of Law and Accounting in Vietnam, founder of the Viet My Law and Accounting brand, which has successfully franchised more than 30 branches nationwide. Viet My is the only Vietnamese brand reputable enough to franchise and succeed in the fields of Law and Accounting.