How to calculate and declare taxes when doing business on social networks

The Tax Department has begun collecting taxes from individuals and businesses with sales revenue from social networks (Facebook, Zalo...) of over 100 million VND/year. In order for people and businesses to strictly fulfill this obligation, the Ho Chi Minh City Tax Department has sent out notices on how to declare and calculate taxes for people and businesses to understand.

A representative of the Ho Chi Minh City Tax Department said that business individuals with revenue from selling goods and services via the internet and social networks, if their income is over 100 million VND/year, will be required to register and pay taxes.

Accordingly, those who do business in this form of e-commerce will have to pay taxes and fees such as: Business license fee, value added tax, personal income tax, special consumption tax, environmental protection tax, etc.

Business individuals with revenue from selling goods and services via the internet and social networks, if their income is over 100 million VND/year, are required to register and pay taxes.

According to the Ho Chi Minh City Tax Department, the calculation of business license fees is as follows: If the revenue is over 500 million VND/year, the fee to be paid is 1,000,000 VND/year; if the revenue is over 300 to 500 million VND/year, the fee is 500,000 VND/year; if the revenue is over 100 to 300 million VND/year, the fee to be paid is 300,000 VND/year.

Individual businesses or newly established businesses that are granted tax registration and tax codes within the first 6 months of the year must pay the annual business license fee; if established, granted tax registration, tax codes, and business codes within the last 6 months of the year, must pay 50% of the annual business license fee.

For value added tax (VAT) and personal income tax (PIT), the calculation is as follows: The amount of VAT payable is equal to (=) Selling price of goods and services multiplied by (X) the VAT rate; the amount of PIT payable is equal to (=) Selling price of goods and services multiplied by (X) the PIT rate.

People and businesses doing business on Facebook can easily declare taxes with instructions from the Ho Chi Minh City Tax Department.

The table of VAT and PIT rates calculated on revenue is determined according to the provisions in Appendix 1 issued with Circular No. 92/2014/TT-BTC. For example, some types of goods and services such as: Distribution and supply of goods have a VAT rate of 1%; PIT rate of 0.5%. The service industry has a VAT rate of 5%; PIT rate of 2%. The transportation industry and services associated with goods have a VAT rate of 3%; PIT rate of 1.5%. For other business activities: VAT rate is 2%; PIT rate is 1%.

If you want to register for tax declaration, you can go to any Tax Department where you reside or temporarily reside. The tax registration dossier includes tax registration form No. 03-DK-TCT and lists (if any); a copy without authentication of the Business Registration Certificate; a copy without authentication of a valid Citizen Identification Card or Identity Card (for individuals with Vietnamese nationality); a copy without authentication of a valid Passport (for individuals with foreign nationality and Vietnamese people living abroad).

The tax declaration dossier includes: Business license fee declaration, tax declaration form 01/CNKD (form issued with Circular 92/2015/TTBTC dated June 15, 2015 of the Ministry of Finance). After completing the declaration part, the tax registration dossier will be submitted directly to the Tax Department or sent by post to the Tax Department.

According to Tin Tuc Newspaper