Answering a series of questions related to tax rates for contract-based business households

Question 1

Taxpayers who contract to pay tax on the sale of textbooks and stationery, in which textbooks receive a 1% commission on revenue, textbooks are a type of goods not subject to VAT. Contracting households are agents who only receive a 1% commission on sales revenue. If electronic invoices generated on cash registers must pay tax at a rate of 1.5% (VAT + PIT), can the tax rate be calculated separately for each item? When creating electronic invoices generated from cash registers, business households will suffer losses on the amount of tax payable that is greater than the commission revenue received.

Answer: According to the guidance in Circular No. 40/2021/TT-BTC, the basis for calculating tax for business households and business individuals (applicable to both contracted households and declaring households) is taxable revenue and tax rate on revenue.

Revenue subject to VAT and revenue subject to personal income tax for business households and business individuals is the revenue including tax (in case of taxable cases) of all sales, processing fees, commissions, and service provision fees that the business households and business individuals receive, regardless of whether the money has been collected or not.

Business households and individual businesses use sales invoices so the invoices do not distinguish tax rates for each product or service.

Question 2

I opened a private clinic that both examines and treats patients and sells medicine, with a total revenue of 950 million/year. With that amount, do I have to use electronic invoices from the cash register? How much tax do I have to pay?

Answer: According to current regulations, your business is not required to use electronic invoices generated from cash registers. However, if you need to use electronic invoices, the tax authority will support you.

The tax amount for business households is determined by the percentage of revenue according to the business line and field (the percentage of revenue is in Appendix I of Circular No. 40/2021/TT-BTC). For medical examination and treatment services that are not subject to value added tax, the personal income tax rate is 2% of revenue. For revenue from the sale of drugs and medical supplies, the value added tax rate is 1%, the personal income tax rate is 0.5%.

Question 3

How should a business household that both produces and trades declare and pay taxes?

Answer: Pursuant to Article 10, Circular No. 40/2021/TT-BTC of the Ministry of Finance , in case a business household operates in many fields and industries, the business household and individual business shall declare and calculate tax according to the tax rate calculated on revenue applicable to each field and industry.

In case a business household or individual cannot determine the taxable revenue of each field or profession or the determination is inconsistent with the actual business, the tax authority shall determine the taxable revenue of each field or profession according to the provisions of the law on tax administration.

Question 4

Households producing and trading goods (shoes, clothes) declare which cases pay tax 1.5%, which cases pay 4.5%? Is it calculated based on the level/value of the order like before, the lump-sum tax was 1.5%, if over 20 million, the invoice is 4.5%?

Answer: According to Circular No. 40/2021/TT-BTC, wholesale and retail activities of goods are subject to a tax rate of 1.5% on revenue (1% value added tax, 0.5% personal income tax). Production and processing of goods and products are subject to a tax rate of 4.5% on revenue (3% value added tax, 1.5% personal income tax).

Based on their production and business situation, business households determine their own percentage of revenue.

Question 5

I am a teacher (not in the public system) teaching in class and have registered a business. How do I pay taxes?

Answer: For tutoring establishments registered as business households: perform personal income tax obligations according to the instructions in Circular 40/2021/TT-BTC of the Ministry of Finance guiding value added tax, personal income tax and management for business households and individual businesses. Business households operating tutoring activities are not subject to VAT, declare and pay personal income tax at a rate of 2% on revenue.

Question 6:

Please advise on tax rates for money transfer services

Answer: Business households and individuals providing money transfer services shall declare and pay taxes according to the provisions of Circular 40/2021/TT-BTC of the Ministry of Finance. Business households and individuals shall declare taxes at the rate of 5% value added tax (VAT) and 2% personal income tax (PIT) on taxable revenue.

Question 7

I run a restaurant and have a revenue of over 1 billion. I have to pay for other fixed costs: raw materials, rent, employee salaries, electricity and water bills, etc. So can I deduct those costs from my revenue? And do I pay tax on profit (after deducting costs) or revenue?

Answer: According to Circular No. 40/2021/TT-BTC of the Ministry of Finance, the amount of tax payable by a business household is determined by multiplying revenue (x) by the applicable tax rate % for each industry and business sector, without deducting expenses. In case the taxpayer is a restaurant or catering service business household, according to regulations, the VAT rate is 3%, and the personal income tax rate is 1.5%.

Source: https://baohatinh.vn/giai-dap-loat-cau-hoi-lien-quan-den-muc-thue-doi-voi-ho-kinh-doanh-khoan-post298362.html