Vietnam tightens tax reporting rules for foreign-linked entities, fines violators up to $3,800

The Hanoi Tax Department has issued a notice reminding taxpayers and related organizations of their obligations to provide information for tax administration and international tax information exchange purposes.

The move is intended to help taxpayers comply with new regulations governing the provision, collection, and verification of information under international tax treaties and agreements to which Vietnam is a party.

Under the regulations, taxpayers and relevant organizations and individuals are required to provide accurate, complete, and timely information upon request by tax authorities.

Credit institutions, branches of foreign banks, and payment intermediary service providers must provide information on financial accounts held by non-resident taxpayers in Vietnam.

Meanwhile, branches and representative offices of foreign companies operating in Vietnam are required to declare and update information on the legal owners and beneficial owners of their overseas parent companies.

Such information must be submitted during initial tax registration and whenever changes occur.

The Hanoi Tax Department stressed that taxpayers and related entities are not allowed to refuse lawful requests from tax authorities on the grounds of banking confidentiality.

Organizations and individuals that submit information at least five days after the deadline may be fined from VND10 million to VND30 million ($380-$1,140).

Providing incomplete or inaccurate information may result in penalties ranging from VND30 million to VND50 million ($1,140-$1,900).

More serious violations, including failing to provide information within 15 days after the deadline or the expiry of an approved extension, may incur fines of between VND50 million and VND100 million ($1,900-$3,800).

The same penalty applies to acts of collusion or concealment aimed at preventing tax authorities from collecting or verifying information for tax information exchange purposes.

In addition to financial penalties, violators may be required to provide complete and accurate information as requested by tax authorities.