The tax authority affirmed that temporary payment of corporate income tax for 3 quarters must reach a minimum of 75% for the whole year according to Decree 126 is just a misunderstanding.

The above content was confirmed by Ms. Le Thi Duyen Hai, Director of Tax Declaration and Accounting (General Department of Taxation) at a conference on March 22, 5 months after Decree 126 was issued.

She said that the amount of money businesses temporarily pay in the first three quarters of the year does not need to be greater than 75% of the tax payable according to the annual settlement. "The tax authority will have another document explaining and clarifying this issue, issued before October 30 this year," said the Department's leader.

Regulation 126 has caused confusion for many businesses recently. Because of the seasonal nature of production and business, many businesses are concerned that if fourth quarter revenue increases sharply compared to previous quarters, they will easily violate the requirement that temporary tax payment for three quarters be at least 75% of the yearly settlement. . Therefore, businesses will unintentionally have to pay late payment fees. Regulations apply from the 2021 tax period.