In recent years, the e-commerce market has grown strongly globally in general and in Vietnam in particular. In Vietnam, people have become more familiar with buying goods on e-commerce platforms; especially during the Covid-19 epidemic, while other “offline” businesses hard to maintain operations, individuals and organizations doing business “online” through e-commerce platforms grew strongly.
In fact, e-commerce activities are very diverse, the scope of business is wide, and change rapidly that pose many problems for the state management, in which tax administration for e-commerce (including cross-border e-commerce activities) is not only a difficult problem, but also is a challenge to the tax administration of many countries.
Tax-paying when selling on e-commerce platforms
On 1st June, 2021, the Ministry of Finance issued Circular No. 40/2021/TT-BTC guiding VAT, personal income tax and tax administration for business households and business individuals engaged in the production and trading of goods and services in all fields and lines of production, doing business in accordance with the provisions of law in the case of e-commerce activities, including individuals have income from digital information content products and services in accordance with the law on e-commerce.
The organization is the owner of an e-commerce trading platform that makes tax declarations and pays taxes on behalf of individuals according to the plan of tax authorities. During the period when tax declaration or paying taxes on behalf of individuals and organizations that are owners of e-commerce trading platforms must be responsible for providing information related to individuals’ business activities through the platform under the request of tax authorities in accordance with the law.
This information includes: Name; personal identification number or identity card or citizen identity card or passport; tax code; address; email; contact phone number; goods and services provided; business turnover; bank account of the seller; other relevant information. Organizations and individuals that file tax declaration or pay taxes on behalf of individuals as authorized by civil law.
The basis for calculating tax for business households and business individuals is the taxable revenue and the tax rate calculated on the revenue. Revenue calculated VAT and personal income tax for business households and business individuals are revenues including taxes (in case of taxable) of all sales, processing, commissions, provision of services incurred during the tax period from production activities, trading in goods and services, including bonuses, promotions, trade discounts, payment discounts, monetary or non-monetary support expenditures; subsidies, surcharges, additional fees are enjoyed according to regulations; compensation for breach of contract, other compensation (included only in the revenue calculated personal income tax); other revenues enjoyed by business households and business individuals regardless of whether they have or have not collected money.
Mentioned above is a consulting article on “Tax collection on e-commerce platforms” of Apra Law Firm. If you have any questions about this issue, please do not hesitate to contact us via hotline for advice and support.
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