Personal Income Tax (PIT) is an essential part of payroll management. Businesses are responsible for accurate tax declaration on behalf of employees. Failure to comply often results in fines and reputational damage.
1. Identify Taxable Individuals
Businesses must declare PIT for:
- Employees with labor contracts.
- Temporary workers, collaborators.
- Individuals earning wages, salaries, or other taxable income.
Proper identification ensures accurate tax declaration and prevents underreporting.
2. Withholding and Filing Deadlines
- Monthly filing if monthly PIT withheld ≥ 50 million VND.
- Quarterly filing if below 50 million VND/month.
- Deadlines: 20th of the following month (monthly) or 30th of the first month of the next quarter (quarterly).
3. Avoid Errors in Calculation
Common issues: incorrect taxable income or family deductions.
- Solution: update deduction rules, double-check income categories, and use accounting software for accuracy in tax declaration.
4. Annual PIT Finalization
- Due by March 31 of the following year.
- Requires tax returns, withholding statements, and individual details.
- Employees can request withholding certificates for self-filing.
5. Document Storage
Keep payroll records, contracts, and tax receipts for at least 10 years to support audits and prove compliance in tax declaration.
Conclusion
Accurate tax declaration for PIT helps businesses comply with laws, protect reputation, and build employee trust. If unsure, outsourcing to professional tax service providers can minimize risks.
