A Complete and Accurate Guide to Declaring Business License Tax

Business license tax is a mandatory tax imposed on businesses and household businesses immediately after registration. Properly declaring the business license tax in accordance with regulations helps businesses stay compliant with the law, avoid penalties, and ensure smooth business operations. This article will guide you in detail on how to declare the business license tax accurately and efficiently.

What is a Business License Tax Declaration?

Definition of Business License Tax Declaration

Business license tax declaration is the process by which a business or household business reports to the tax authority the amount of business license tax payable annually. This is a mandatory financial obligation that helps the government manage state budget revenue and ensures transparency in business operations.

Role and Significance of Business License Tax

Business license tax provides the government with a stable source of revenue from businesses and household operations. Timely declaration and payment of this tax help businesses comply with legal regulations, avoid administrative penalties, and maintain lawful business activities.

Who is Required to Declare Business License Tax?

• Enterprises and companies established under Vietnamese law
• Individual household businesses with revenue from production or trading activities
• Branches and representative offices that operate independently
  

Latest Updates on Business License Tax

According to Decree 22/2020/NĐ-CP, newly established businesses are exempt from business license tax in their first year of operation. Additionally, branches and representative offices established in the same year are also exempt. However, after the first year, businesses must declare and pay the tax on time to avoid penalties.

Entities Required to Declare and Pay Business License Tax

Businesses and Household Businesses That Must Declare Business License Tax

All businesses, household businesses, and organizations engaged in commercial activities are required to declare business license tax in accordance with legal regulations. This ensures that all entities operating within the economy fulfill their responsibility to contribute to the national budget.

Cases Exempt from Business License Tax

Certain entities are exempt from business license tax to support new businesses or small-scale operations. Exemptions include:

• Newly established businesses in their first year of operation, starting from the date of issuance of the business registration certificate.
• Household businesses with annual revenue under VND 100 million.
• Public educational institutions, public hospitals, or non-profit organizations operating in accordance with the law.
  

Timeline for Declaring and Paying Business License Tax

Businesses and household businesses should take note of the deadlines to avoid unnecessary penalties. Specific deadlines include:

• Newly established businesses: Must declare and pay business license tax within 30 days from the date of issuance of the business registration certificate.
• Active businesses: Must complete the declaration and payment of business license tax no later than January 30th each year.
• Household businesses: Depending on local regulations, household businesses will be notified of the timeline for business license tax declaration each year.
  

Business License Tax Rates by Entity

The business license tax amount is based on charter capital or annual revenue for businesses and household operations. According to the latest regulations:

• Businesses with charter capital over VND 10 billion: VND 3 million/year
• Businesses with charter capital of VND 10 billion or less: VND 2 million/year
• Branches, representative offices, and business locations: VND 1 million/year
  

Household businesses:

• Annual revenue over VND 500 million: VND 1 million/year
• Annual revenue from VND 300–500 million: VND 500,000/year
• Annual revenue from VND 100–300 million: VND 300,000/year

Timely declaration and payment of business license tax not only ensures legal compliance but also helps businesses avoid unnecessary penalties. If you have any questions regarding the tax declaration process, it is recommended to contact your local tax authority for detailed guidance.

Learn more: 10 CASES EXEMPT FROM BUSINESS LICENSE TAX

How to Declare Business License Tax Online (Latest Guide)

Step 1: Log in to the Electronic Tax Declaration System

Go to the website thuedientu.gdt.gov.vn and log in using your enterprise account.

Step 2: Select the Business License Tax Declaration Form

In the main interface, choose the “Register Declaration Form” section and select the appropriate business license tax form that matches your business type.

Step 3: Fill in the Information and Submit the Declaration

Install the HTKK software provided by the General Department of Taxation to assist with the declaration process.

Enter all required business information and the amount of business license tax payable. Carefully review all information before exporting the XML file to upload it to the electronic tax system.

Step 4: Digitally Sign and Submit the Declaration Online

Use your digital signature to authenticate the declaration, then submit it to the system to complete the tax declaration process.

After submitting the declaration, the business can check the processing status on the electronic tax system to ensure that the declaration has been accepted.

Guide to Paying Business License Tax Online

Register for an Electronic Tax Payment Account

Businesses must register for an electronic tax payment account on the official website of the General Department of Taxation. This registration simplifies the process of tax declaration and online payment, saving time and effort. After registration, businesses can use this account to fulfill other tax obligations.

Choose a Bank for Tax Payment

Once registration is complete, the business needs to link its bank account with the electronic tax system to make payments. Businesses can choose from the supported banks for smooth transactions. Selecting the right bank helps ensure quick and accurate payment processing.

Confirm Payment Information

The business must enter the tax amount payable based on the previously submitted declaration. It’s important to carefully review and confirm this information to avoid any errors during the transaction. If there are any mistakes, they should be corrected before proceeding with payment to avoid future refund procedures or adjustments.

Complete the Transaction and Save the Tax Receipt

After entering the payment information, the business should confirm the transaction to complete the tax payment process. The system will issue an electronic receipt confirming the amount paid. It’s important to save this receipt as proof of payment for future reference, especially in cases of audits or tax finalization.

Check Confirmation of Tax Payment

Once payment is completed, the business can log into the electronic tax system to check the tax payment status. If any errors occur during the process, the business should contact the tax authority for timely support. Checking the payment status ensures tax obligations are fulfilled on time and helps avoid unnecessary administrative penalties.

Important Notes When Paying Business License Tax Online

• Ensure sufficient bank account balance to complete the transaction: Avoid failed transactions due to insufficient funds.
• Verify business information before making payment: Incorrect information can lead to failed payments or tax misreporting.
• Keep all confirmation documents: Storing electronic receipts provides legal proof in case of audits.
• Pay taxes on time: Be aware of deadlines to avoid late payment penalties.
• Regularly monitor changes in tax policy: Tax laws may change, so businesses should stay updated to ensure compliance.

Learn more: Why Do We Have to Pay Taxes? Understanding Taxes and Their Types

Guide to Declaring and Paying Business License Tax Directly at the Tax Office

Prepare Business License Tax Declaration Documents

To declare business license tax in person, businesses must prepare all required documents as requested by the tax authority. These documents include:

• Business License Tax Declaration Form (Form 01/MBAI) as prescribed by the General Department of Taxation
• Certified copy of the Business Registration Certificate
• ID card or Citizen ID of the legal representative
• Power of attorney (if the person submitting is not the legal representative)
• Proof of payment, if the tax was paid in advance via bank transfer
  

Submit the Tax Declaration at the Tax Office

Once the documents are fully prepared, the business must go to the local Tax Sub-Department where it is registered to submit the declaration. Tax officers will check the validity of the documents and confirm the business’s declaration.
Before visiting, businesses are advised to contact the Tax Sub-Department in advance to confirm working hours and specific requirements, to avoid delays or rejection due to incomplete paperwork.

Pay Business License Tax at a Bank or State Treasury

After declaring the tax, businesses must proceed with the payment as instructed by the tax authority. There are two payment methods:

• Via a bank linked with the State Treasury: Bring the payment order to the designated bank to complete the transaction.
• Directly at the State Treasury: Businesses can also go directly to the local State Treasury and pay in person following the given instructions.
  After payment, it is important to retain the tax receipt as proof in case of discrepancies or audits by the tax authority.
  

Verify Declaration and Payment Confirmation

Once all steps are completed, businesses can verify their declaration and payment status by:

• Contacting the managing Tax Sub-Department directly to check the processing status
• Checking the tax receipt to confirm that the business license tax obligation has been fulfilled
• Storing all tax-related documents for future reference or reconciliation
  

Important Notes When Declaring and Paying Business License Tax in Person

• Submit documents on time to avoid late submission penalties
• Ensure all paperwork is complete and accurate to prevent delays
• Keep all receipts and relevant documents as legal proof in case of tax inspections
• Stay updated with the latest business license tax regulations to ensure full compliance

Important Notes When Declaring and Paying Business License Tax

Deadlines for Declaring and Paying Business License Tax

• Newly established businesses: Must declare and pay the tax within 30 days from the date of issuance of the business registration certificate.
• Active businesses: The deadline for tax payment is January 30th each year.
• Household businesses: Should check notifications from the local tax authority to determine the specific deadline.

Avoid Penalties for Late Declaration and Payment

Businesses should strictly observe the tax deadlines to avoid penalties. Penalty rates for late payments are as follows:

• 1–5 days late: Fine of 0.03% of the unpaid tax amount per day.
  6–30 days late: Fine ranging from VND 500,000 to VND 1,500,000.
• Over 30 days late: Fine ranging from VND 2,000,000 to VND 5,000,000.
  If the business fails to pay and is discovered by the tax authority, heavier penalties may be imposed, and the outstanding tax amount will be collected.
  

Keep Complete Tax Documents and Receipts

After paying the business license tax, businesses must retain receipts, documents, and declaration files for future reference. This facilitates easy verification and serves as essential evidence during tax finalization or audits by tax authorities.

Declaring and paying business license tax is a crucial part of a company’s operations. Timely payment helps businesses avoid unnecessary administrative penalties and ensures compliance with legal regulations. Whether submitting tax documents directly at the tax office or through the electronic tax system, accuracy and punctuality are key.

For any inquiries, contact Wacontre Accounting Services via Hotline: (028) 3820 1213 or email info@wacontre.com for prompt assistance. With a team of experienced professionals, Wacontre is committed to providing dedicated and efficient service. (For Japanese clients, please contact Hotline: (050) 5534 5505).