How should the incorrect use of the tax code for the filer be handled?

The company has filed, deducted, and paid taxes on behalf of the foreign contractor using the company’s tax code instead of the foreign contractor’s tax code, as per Form 01/NTNN. So, how should the incorrect use of the tax code for the filer be handled?

Based on Clause 1, Article 44 of the Tax Administration Law 2019:

Point a, Clause 1, Article 44 states:

“Article 44. Deadline for submitting tax returns

The deadline for submitting tax returns for taxes declared monthly or quarterly is as follows:
a) No later than the 20th day of the month following the tax obligation month for monthly declarations; ...”

Article 47 stipulates the supplementary tax return submission:

“1. Taxpayers who discover errors in their submitted tax returns may submit supplementary tax returns within 10 years from the deadline for submitting the original return of the tax period with errors, but before the tax authority or the competent agency issues an inspection or audit decision.

...”

The tax payment deadline is specified in Clause 1, Article 55:

"1. In cases where the taxpayer calculates the tax, the tax payment deadline is no later than the last day of the tax return submission deadline. In cases of supplementary tax returns, the tax payment deadline is the submission deadline of the tax return for the period with errors."

Point b, Clause 1, Article 59 defines penalties for late tax payment:

“Article 59. Handling late tax payments

The cases requiring late tax payment include:
a) Taxpayers who fail to pay tax on time as prescribed, or as extended, or as indicated in tax notices, tax decisions, or decisions on handling from the tax authority;

b) Taxpayers who submit supplementary tax returns that increase the tax payable or are discovered by the tax authorities to have underreported tax payments, must pay late tax for the additional tax from the next day after the tax payment deadline for the tax period with errors.”

The late payment penalty rate is 0.03% per day on the unpaid tax amount.

The taxpayer must calculate and submit the late payment penalty to the state budget as prescribed.

According to Point a, Clause 1, Article 8 of Decree 126/2020/ND-CP:

"Article 7. Tax returns

Tax returns include the tax declaration form and related documents that are used to determine the taxpayer’s tax obligations to the state budget. Taxpayers must file tax returns and appendices as required by the Ministry of Finance and are responsible for the accuracy and completeness of the content in the return.”
According to Clause 1, Clause 2, Article 13 of Decree 125/2020/ND-CP regarding administrative violations:

"Article 13. Penalties for violating the deadline for submitting tax returns

A warning for late submission of tax returns within 1 to 5 days with mitigating circumstances.

A fine from 2,000,000 VND to 5,000,000 VND for late submission of tax returns from 1 to 30 days, except as stated in Clause 1."

• Based on these legal provisions:

If the company has filed, deducted, and paid taxes on behalf of the foreign contractor using the company's tax code, it must submit a corrected tax return (Form 01/NTNN) with the foreign contractor’s correct tax code and pay any additional tax due, as well as calculate and pay any late payment penalties in accordance with Article 59 of the Tax Administration Law.

In case of late submission, the company will be penalized as per the regulations in Decree 125/2020/ND-CP.

Applicable Legal Documents:

• Tax Administration Law 2019
• Decree 126/2020/ND-CP
• Decree 125/2020/ND-CP

Source: General Department of Taxation - Q&A on Taxation.