Headlines 28/07/2020 13:35 CH

Instructions about tax set-offs to be issued to enterprises with related-party transactions

Bích Tuyền

This is the highlight of the Official Dispatch No. 2835/TCT-TTKT providing guidance on implementation of the Decree No. 68/2020/ND-CP of the General Department of Taxation.

According to this document, setting off corporate income tax (CIT) amounts paid in 2017 and 2018 for enterprises with related-party transactions under the provisions of the Decree 68 must adhere to the following instructions:

On carrying out the re-assessment of the CIT amount payable according to the new interest rate ceilings prescribed in the Decree No. 68/2020, in case of such amount is reduced, taxpayers will be entitled to proportionate deductions from relevant tax deferrals (if any). Below are the specific regulations:

** Concerning tax amounts not yet reviewed or audited:

- Taxpayers may set off CIT and CIT deferral differences against the CIT amount payable in 2020.

- In case of failure to carry out the complete set-off in 2020, such set-off will be continued with respect to CIT amounts payable in 5 consecutive years from 2020.

- Upon expiry of such period, the remaining CIT amount that fails to be completely set off will be left aside.

** Concerning tax amounts already reviewed or audited, and subject to review or audit conclusions and response decisions: 

- Taxpayers may request directly supervisory Tax Departments or Subdepartments to re-determine the CIT amount payable.

- After final calculation results are given, the tax set-off in this case will be carried out in the same manner as in the first case.  

For more details, please read the Official Dispatch No. 2835/TCT-TTKT dated July 14, 2020.

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