In the world of accounting, precision and carefulness are crucial. Even a small mistake can have significant implications for the assets and legal status of an organization. This is particularly true when it comes to tax reporting, where clear and accurate information is essential to avoid penalties. In this article, we will provide you with valuable insights into what tax reporting is and how to go about it for your business.
What is Tax Reporting?
Tax reporting refers to the process of disclosing the input value-added tax (VAT) invoices incurred during the purchase or acquisition of goods and services, as well as the output VAT invoices issued by the business.
Tax reporting acts as a bridge for tax authorities to understand the operations of businesses. Therefore, it is essential to have a clear understanding of the legal requirements for tax reporting. This includes knowledge of the types of tax returns that businesses need to file, the deadlines for submitting the returns, and the timelines for paying any taxes owed.
Deadlines for Tax Reporting
The deadlines for tax reporting vary depending on the type of tax return being filed. These include value-added tax (VAT), personal income tax (PIT), corporate income tax (CIT), and the report on the use of invoices. Here are the specific deadlines:
VAT Returns (Monthly/Quarterly)
For businesses filing VAT returns on a quarterly basis, the latest date for submission is the 30th day of the following month after the end of the reporting quarter. For businesses filing VAT returns on a monthly basis, the deadline is the 20th day of the following month after the reporting month.
The decision to file VAT returns on a monthly or quarterly basis is determined by the business at the beginning of the financial year. However, many small and medium-sized enterprises (SMEs) opt for quarterly VAT reporting.
The deadline for paying VAT (if applicable) is the same as the deadline for filing VAT returns.
Report on the Use of Invoices (Quarterly)
The deadline for filing the report on the use of invoices is the 30th day of the first month of the following quarter.
Note: If a business does not have any usage of invoices during a particular period, it is still required to file the report on the use of invoices. However, if a business has not notified the issuance of invoices, this report does not need to be filed.
Provisional CIT Returns (Quarterly)
Starting from November 15, 2014, according to the regulation stated in Circular 151/2014/TT-BTC, businesses are not required to file provisional CIT returns. However, businesses are still required to pay provisional CIT if they have determined the amount of CIT payable.
At the end of the financial year, if the CIT amount declared in the final CIT settlement report is more than 20% of the total provisional CIT paid for the four quarters, the business will be penalized for the difference.
PIT Returns (Monthly/Quarterly)
For businesses filing VAT returns on a quarterly basis, the PIT return will also be filed on a quarterly basis. For businesses filing VAT returns on a monthly basis, the decision of whether to file the PIT return on a monthly or quarterly basis is based on the amount of provisional PIT paid for the month.
- Case 1: If the provisional PIT paid for the month is less than 50,000,000 VND, the PIT return will be filed on a quarterly basis.
- Case 2: If the provisional PIT paid for the month is more than 50,000,000 VND, the PIT return will be filed on a monthly basis.
The determination of the filing period mentioned above will be made at the beginning of the financial year.
How to Prepare Tax Reports
Except for exceptional tax reporting periods, the tax report package includes monthly and quarterly reports, which consist of the taxes incurred during the production and business activities of a company. These reports are as follows:
Here is how to prepare VAT reports using the input VAT deduction method:
- VAT Return Form No. 01/GTGT.
- List of outgoing invoices using VAT Return Form No. 01-1/GTGT.
- List of incoming invoices using VAT Return Form No. 01-2/GTGT.
- Other relevant attachments (if applicable).
Here is how to prepare VAT reports using the direct method:
- Direct method based on VAT: Prepare the VAT return according to the requirements of Form No. 03/GTGT.
- Direct method based on revenue: Prepare the VAT return according to the requirements of Form No. 04/GTGT.
- List of outgoing invoices for goods and services using VAT Return Form No. 04-1/GTGT.
Important Considerations for Monthly Tax Reporting
Tax reporting is an essential task for accountants, as it needs to be submitted to the tax authorities regularly each month. To ensure accurate and timely reporting, here are some things to keep in mind:
- Organize outgoing invoices in chronological order according to the date.
- Clearly distinguish between goods, raw materials, assets, and tools when recording transactions in the accounting software.
- Make multiple copies of invoices and supporting documents to prevent loss or misplacement.
- Carefully prepare and review monthly tax reports.
- Make adjustments in the accounting software and review the data before generating and submitting the tax returns.
- Handle any issues related to accounts during the accounting reconciliation process.
- Prioritize the settlement of CIT to compare it with the CIT difference. This will allow for appropriate journal entries to resolve the 20% difference before compiling the financial statements.
- Regularly reconcile all relevant matters such as taxes, costs, and profits to avoid overload when preparing financial statements at the end of the year.
At APOLO, we provide you with the information you need to submit taxes and complete tax declarations on time. If you still have questions or need guidance on how to file taxes, please feel free to contact us.
For more information, please visit Kienthucykhoa.com.
- Company: APOLO Trading and Services Co., Ltd.
- Headquarters: 348 Nguyen Thi Minh Khai, Ward 5, District 3, Ho Chi Minh City.
- Email: [email protected]
- Hotline: 090 444 84 64