This circular guides the calculation of VAT and Corporate Income Tax for businesses relocating their place of business in accordance with planning by competent state authorities.
Đối tượng áp dụng
Provincial and Central City Tax Departments and Enterprises
Các điểm cốt lõi
- When enterprises relocate according to planning, they must liquidate or sell assets subject to VAT (Article 1).
- If the State provides financial support and compensation for property on land such that the value after deducting related costs is not negative, the enterprise does not need to pay Corporate Income Tax but should record it as other operating income and increase basic construction investment capital (Article 2).
- In cases where income arises from transferring land use rights or leasing rights when relocating according to planning, enterprises shall follow the guidance provided in Circular No. 128/2003/TT-BTC (Article 2).
- Enterprises receive tax relief when relocating their place of business according to planning.
- Provincial and Central City Tax Departments provide specific guidelines on calculating taxes for relocating enterprises.
- People and businesses in areas subject to relocation will receive State support to change their place of operation.
🌐 Tác động xã hội từ văn bản này
- Enterprises receive tax relief when implementing relocation according to planning.
- Provincial and Central City Tax Departments provide specific guidelines on calculating taxes for relocating enterprises.
- People and businesses in areas subject to relocation receive State support to change their place of business.
❓ Câu hỏi thường gặp
Must an enterprise pay VAT when liquidating or selling assets during relocation according to planning?
Yes, the enterprise must calculate, declare, and pay VAT according to the guidance provided in Circular No. 120/2003/TT-BTC.
Does an enterprise receiving financial support for relocation from the State need to pay Corporate Income Tax?
No, if the value after deducting related costs is not negative, the enterprise does not need to pay tax but should record it as other operating income.
How should enterprises handle income from transferring land use rights when relocating according to planning?
Enterprises shall follow the guidance provided at Point 3, Section II, Part C of Circular No. 128/2003/TT-BTC.
What responsibilities do Tax Departments have in this matter?
Guide enterprises on calculating VAT and Corporate Income Tax when relocating according to planning.
Can an enterprise record a loss if the value of support and compensation is lower than related costs?
Yes, the enterprise can record it as a loss in this case.
Toàn văn
LETTER
OF THE MINISTRY OF FINANCE NUMBER 13610 TC/CST ON NOVEMBER 22, 2004
REGARDING VALUE-ADDED TAX AND ENTERPRISE INCOME TAX FOR BUSINESSES
MOVING OPERATING LOCATIONS ACCORDING TO PLANNING
RESPECTED: Provincial and Central City Tax Bureaus
The Ministry of Finance has received letters from several businesses requesting guidance on value-added tax and enterprise income tax for businesses relocating production and business premises according to the planning by authorized state agencies when implementing clearance and compensation, including liquidation or sale of assets. Regarding this matter, the Ministry of Finance provides instructions as follows:
1. On Value-Added Tax
Businesses relocating their operating locations according to the planning by authorized state agencies that conduct liquidation or sale of taxable goods during relocation must calculate, declare, and pay value-added tax in accordance with Circular No. 120/2003/TT-BTC dated December 12, 2003, issued by the Ministry of Finance to guide implementation of Decree No. 158/2003/NĐ-CP dated December 10, 2003, promulgated by the Government detailing the implementation of the Law on Value-Added Tax.
2. On Enterprise Income Tax
When relocating according to planning by authorized state agencies and receiving financial support for relocation costs and compensation for assets on land, if the value of such support and compensation after deducting related expenses (if any) is not subject to enterprise income tax but should be recorded as other operating profit, then transferred to increase basic construction investment capital. In cases where the amount of financial support and compensated asset values are lower than related expenses, businesses may record it as a loss.
If there is income generated from transferring land use rights or leasing rights due to relocation according to planning, implementation shall follow the guidance at Point 3, Section II, Part C of Circular No. 128/2003/TT-BTC dated December 22, 2003, issued by the Ministry of Finance guiding the implementation of Decree No. 164/2003/NĐ-CP dated December 22, 2003, promulgated by the Government detailing the implementation of the Law on Enterprise Income Tax.
The Ministry of Finance informs Provincial and Central City Tax Bureaus to be aware and guide implementation accordingly.
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