Making tax settlement Corporate income tax is a mandatory process that all accountants and business owners must perform at the end of the fiscal year. According to regulations... Tax Administration Law No. 38/2019/QH14, Accurately determining tax obligations not only helps businesses comply with the law but also optimizes operating costs through preferential policies.
Statistics from the General Department of Taxation show that over 301 businesses were penalized for administrative violations during the inspection period due to errors in their records. Understanding how to properly handle corporate income tax finalization helps you control the risk of tax arrears and late payment penalties, while also enhancing your financial credibility. Let's explore the detailed roadmap below to successfully complete your tax finalization.
Why is it important to master the process of filing corporate income tax returns?
Properly handling corporate income tax settlement is the foundation of financial risk management. When businesses follow the correct procedures, the indicators on financial statements will accurately reflect business results, building confidence with investors.
Here are the core reasons why accountants need to pay special attention:
- Comply with the law: Comply strictly with Decree 126/2020/ND-CP and Circular 80/2021/TT-BTC.
- Cost optimization: Identifying deductible expenses correctly is crucial for legally reducing your tax liability.
- Avoid systemic errors: Detect accounting errors promptly during the previous year before submitting the official tax return.
Important legal basis when carrying out the corporate income tax settlement process.
Before you begin, you need to systematize the currently effective legal documents. This serves as a "guide" to ensure the legal validity of all declared data.
Current laws and regulations
Currently, the method for settling corporate income tax is based on the following key documents:
- Law on Corporate Income Tax No. 14/2008/QH12 (and its amendments and supplements).
- Law No. 38/2019/QH14 on Tax Administration stipulates the deadline and procedures for tax declaration.
- Decree 218/2013/ND-CP provides detailed guidance on the implementation of the Corporate Income Tax Law.
- Decree 126/2020/ND-CP on tax management.
Detailed guiding circulars
Circular 78/2014/TT-BTC and Circular 96/2015/TT-BTC are two essential documents for accountants when determining revenue and expenses. In addition, Circular 80/2021/TT-BTC provides guidance on the latest declaration forms that businesses must apply for the final settlement period.
The entities required to file corporate income tax returns are:
Most organizations engaged in production and business activities that generate income are required to file tax returns. Correctly identifying the entity helps you choose the right forms, avoiding the submission of incorrect or incomplete documents as required by the tax authorities.
| Business type | Settlement responsibility | Special note |
| Private/Joint Stock Company | Annual requirement | Financial statements must be submitted along with the tax return. |
| Revenue-generating public service units | Obligatory | Based on revenue or income |
| Newly established business | Obligatory | From the date of issuance of the business license until the end of the year. |
| Business dissolution/merger | At the time of termination | The settlement must be completed within 45 days. |
Identifying the correct target group is a crucial first step in the process of settling corporate income tax to ensure compliance.
If your business is subject to tax settlement but finds the process too complex, with numerous forms and prone to errors, using a professional service will save time and reduce risks. MAN provides such services. corporate income tax settlement services With a team of experienced tax experts, we provide support in reviewing data, preparing tax returns in accordance with regulations, and representing clients in explanations when necessary. This allows businesses to confidently fulfill their tax obligations on time and focus on their core business activities.
See also: Corporate Income Tax Settlement Service Price List here
The 6-step process for properly filing corporate income tax returns.
To achieve high efficiency, accounting should be carried out in a logical sequence. This helps to tightly control the data and avoid overlooking tax incentives.
Step 1: Gather invoices and supporting documents and verify their validity.
Before beginning the corporate income tax settlement process, you need to ensure that both input and output invoices are legitimate. Invoices exceeding 20 million VND must have non-cash payment documentation in accordance with Circular 173/2016/TT-BTC.
Step 2: Check accounting entries and reconcile ledgers.
Accountants perform closing entries, finalize accounts, and reconcile detailed ledgers with the general ledger. They ensure that accounts of categories 5 to 9 have no remaining balances. This is a crucial step in the corporate income tax settlement process to ensure the accuracy of the tax return data.
Step 3: Determine taxable revenue and other income.
Taxable revenue includes sales, processing fees, service provision, and subsidies or surcharges. You need to pay attention to the revenue determination period as stipulated in Article 5 of Circular 78/2014/TT-BTC to avoid under-declaring revenue for any period.
Step 4: Classify deductible and non-deductible expenses.
This is the most complex part of the corporate income tax settlement process. It requires eliminating expenses that do not correspond to revenue, lack invoices, or exceed the permitted interest expense limit for businesses with related-party transactions, as stipulated in Decree 132/2020/ND-CP.
Step 5: Calculate tax deductions and incentives.
Businesses may be eligible for preferential tax rates or exemptions if they belong to priority sectors. Omitting these benefits from corporate income tax settlements will cause businesses to lose significant economic advantages.
Step 6: Prepare the Corporate Income Tax Return (Form 03/TNDN)
After obtaining the data, you enter it into the HTKK software. Check the indicators from [A1] to [E] on the declaration form to ensure the logic between the main declaration form and the accompanying appendices before submitting.
List of documents to be prepared for the settlement period
Having complete documentation helps ensure a smooth and professional corporate income tax settlement process.
| STT | Document/File Name | Note |
| 1 | Corporate income tax finalization declaration (Form 03/TNDN) | Exported from the latest HTKK software. |
| 2 | Annual financial report | Complete Balance Sheet, Income Statement, Cash Flow Statement, and Notes to the Financial Statements. |
| 3 | Tax incentive appendices (if any) | Appendix 03-3A, 03-3B… |
| 4 | Associated Transactions Appendix | According to the model of Decree 132/2020/ND-CP |
| 5 | General ledger and subsidiary ledgers | Print, sign, and stamp for archiving. |
Detailed instructions on the criteria for the 03/TNDN tax return form.
When performing corporate income tax settlement using the HTKK software, accountants need to pay special attention to the core item codes to clearly explain the data during audits.
- Criterion [A1]: Total accounting profit before tax, taken directly from the annual Income Statement.
- Criterion [B4]: Non-deductible expenses are used to adjust taxable income upwards during tax settlement.
- Criterion [C4]: Taxable income is determined after deducting tax-exempt income and carried-forward losses.
Deadline and location for submitting tax return documents.
Filing your tax return on time is crucial to avoiding administrative penalties under the 2019 Tax Administration Law.
- Duration: No later than the last day of the third month following the end of the calendar year or fiscal year.
- Location: Submit via the General Department of Taxation's electronic portal (thuephi.gdt.gov.vn) or at the directly managing Tax Office.
Adhering to deadlines is a crucial responsibility in the process of settling corporate income tax.
Common mistakes and risks in the process of filing corporate income tax returns.
Accountants often make systemic errors leading to heavy tax arrears. Identifying risks beforehand is a crucial part of the corporate income tax settlement process.
- Bill: Using invoices from businesses that have absconded or lacking bank payment documents for transactions exceeding 20 million VND.
- Expense: Wages lacking labor contracts, depreciation costs exceeding the limits stipulated in Circular 45/2013/TT-BTC, or expenses not related to production.
- Transferring losses: Incorrect time period (over 5 years) or incorrect amount, leading the tax authorities to adjust the tax payable upwards.
Conclude
The process of filing corporate income tax returns is a technical procedure requiring accuracy and solid legal knowledge. Mastering the steps in preparing the return not only helps businesses fulfill their obligations but also allows them to assess their financial health after a year of operation. Investing in learning how to properly file corporate income tax returns brings long-term benefits in terms of both economics and reputation for the organization.
If your business is struggling with data processing or concerned about the risks of handling corporate income tax returns in-house, contact MAN – Master Accountant Network immediately. We provide professional auditing, tax accounting, tax consulting, tax settlement, and tax reporting services. Let MAN be your partner on the path to sustainable growth and legal compliance.
Service contact information at MAN – Master Accountant Network
- Address: No. 19A, Street 43, Tan Thuan Ward, Ho Chi Minh City
- Mobile/Zalo: 0903 963 163 – 0903 428 622
- Email: man@man.net.vn
Content production by: Mr. Le Hoang Tuyen – Founder & CEO MAN – Master Accountant Network, Vietnamese CPA Auditor with over 30 years of experience in Accounting, Auditing and Financial Consulting.
Frequently Asked Questions about How to Prepare Corporate Income Tax Returns
Yes. Businesses still need to file corporate income tax returns to report their operational status and expenses incurred in maintaining their operations.
For businesses with related-party transactions, deductible interest expenses are limited to a maximum of 30% EBITDA. This is a point that requires special attention in the current corporate income tax settlement process.
Yes. Businesses can submit supplementary declarations if they discover errors before the inspection announcement is made at their headquarters. Do businesses with no revenue need to file tax returns?
How are interest expenses controlled?
Is it possible to resubmit the tax return if errors are discovered?
