Instructions on extending the deadline for corporate income tax payment and reducing land rent.

The Ministry of Finance has just issued Circular No.16/2013/TT-BTCInstructions on extending the deadline for paying corporate income tax and value-added tax; reducing land rent, etc., according to Resolution No.02/NQ-CPGovernment decision dated January 7, 2013. Extending the deadline for corporate income tax payment by 6 months.

Regarding the extension of corporate income tax payment deadlines, the Circular stipulates: A 6-month extension for corporate income tax payments due in the first quarter and a 3-month extension for corporate income tax payments due in the second and third quarters of 2013.

The entities eligible for the extension include three groups: 1. Small and medium-sized enterprises, including branches, affiliated units with independent accounting, and cooperatives (employing fewer than 200 full-time employees and with annual revenue not exceeding VND 20 billion), excluding enterprises operating in the fields of finance, banking, insurance, securities, lottery, games with prizes, and manufacturing of goods and services subject to excise tax; 2. Enterprises employing a large workforce (over 300 employees) in the production, processing, and manufacturing sectors: agricultural products, forestry products, aquatic products, textiles, leather goods, electronic components; and construction of socio-economic infrastructure projects, are eligible for an extension of tax payment on income from production, processing, and manufacturing activities of: agricultural products, forestry products, aquatic products, textiles, leather goods, electronic components, and from construction activities of socio-economic infrastructure projects; 3. Businesses investing in and trading (selling, leasing, lease-purchasing) housing are granted an extension for paying taxes on income derived from housing investment and trading activities, regardless of business size and number of employees.

Regarding the extension period for corporate income tax payment, the Circular stipulates the following:

Extending the deadline for Value Added Tax (VAT) payment by 6 months: Simultaneously, the Circular stipulates a 6-month extension for the deadline to pay Value Added Tax (VAT) for the VAT payable for January, February, and March 2013 (excluding VAT at the import stage) for businesses currently paying VAT using the deduction method.

The entities eligible for extension include: small and medium-sized enterprises; enterprises employing a large workforce in the production, processing, and manufacturing sectors: agricultural products, forestry products, aquatic products, textiles, leather goods, electronic components; construction of socio-economic infrastructure projects; enterprises investing in and trading (selling, leasing, lease-purchasing) housing; and enterprises producing goods such as iron, steel, cement, bricks, and tiles.

Regarding the extension period, the Circular clearly stipulates: Businesses eligible for the VAT payment extension must declare and submit the VAT tax returns for January, February, and March 2013 as prescribed, but are not required to immediately pay the VAT payable arising from the declared VAT tax returns. Specifically:

Furthermore, the Circular also specifies the entities eligible for a 50% reduction in land lease fees payable in 2013 and 2014. It also clarifies that projects using land for the purpose of building houses for sale, lease, or developing infrastructure for transfer, under the form of state-allocated land with land use fees, where the investor has been handed over the land but has not yet fulfilled their financial obligations regarding land use fees due to financial difficulties such as: financial results as of December 31, 2012 showing losses, or business expenses exceeding revenue due to excessively large inventory values, or the business having incurred significant investment costs but not yet generating revenue due to unsold goods, are allowed to pay land use fees within 24 months from the due date stated in the tax authority's notice and will not be subject to late payment penalties during this period.

This Circular takes effect from March 25, 2013.

According to (Chinhphu.vn) – LT