Thông tư 61/2016/TT-BTC khoản lợi nhuận được chia cho phần vốn Nhà nước đầu tư

THE MINISTRY OF FINANCE

Circular No. 61/2016/TT-BTC dated April 11, 2016 of the Ministry of Finance guiding collection, remittance and management of profits and dividends earned from state capital amounts invested in enterprises

Pursuant to the Law on tax management No. 78/2006/QH11 dated November 29, 2006; the Law No. 21/2012/QH13 dated November 290, 2012 amending, supplementing a number of articles of the Law on tax management and the Law No. 71/2014/QH13 dated November 26, 2014 amending, supplementing a number of articles of the law on tax;

Pursuant to the Law on enterprises No. 68/2014/QH13 dated November 26, 2014;

Pursuant to the Law No. 69/2014/QH13 dated November 26, 2014 on management and use of state capital to invest in business production in enterprises;

Pursuant to the Law No. 14/2008/QH12 on enterprise income tax dated June 03, 2008; the Law No. 32/2013/QH13 dated June 19, 2013 on amending, supplementing a number of articles of the Law on enterprise income tax;

Pursuant to the Decree No. 83/2013/ND-CP dated July 22, 2013 of the Government detailing a number of articles of the Law on Tax Administration and the Law Amending and Supplementing a Number of Articles of the Law on Tax Administration; the Decree No. 12/2015/ND-CP dated February 12, 2015 of the Government detailing the implementation of the Law Amending and Supplementing a Number of Articles of the Tax Laws and amending and supplementing a number of articles of the decrees on taxes;

Pursuant to the Decree No. 87/2015/ND-CP dated October 06, 2015 of the Government on supervision of state capital investment in enterprises; financial supervision, performance assessment and disclosure of financial information of state-owned and state-invested enterprises;

Pursuant to the Decree No. 215/2013/ND-CP dated December 23, 2013 of the Government defining the functions, tasks, powers and organizational structure of the Ministry of Finance;

At the proposal of the General Director of Taxation Department;

The Minister of Finance promulgates the Circular guiding collection, remittance and management of profits and dividends earned from state capital amounts invested in enterprises as follows:

Chapter I

GENERAL PROVISIONS

Article 1. Scope of application

This Circular details on collection, remittance of profit after tax remaining after making deductions for funds for parent companies of the State economic corporations, parent companies of the state corporations, parent companies in the group of parent – subsidiary, one member limited liability company that the state holds 100% of working capital; remittance, collection of dividends and profitsearned from state capital amounts invested in joint stock companies,limited liability companies with two or more members whose capital contribution is represented by ministries, sectors, localities.

Article 2. Subjects of application

1.Enterprises that the state holds 100% of working capital, including:

a) One - member limited liability companies being parent companies of state economic corporations;

b) One - member limited liability companies being parent companies of state corporations (including state capital investment corporations – hereinafter referred to as SCIC).

c) One - member limited liability companies being parent companies in the parent – subsidiary group;

d) Independent one member limited liability companies;

2. Joint stock companies that state capital contribution is represented by ministries, sectors, localities;

3.Limited liability companies with two or more members that state capital contribution is represented byministries, sectors, localities;

4. Owner representative agency;

5. Representatives of state capital invested in joint stocks, limited liability companies with two or more members.

6. Other agencies, organizations, individuals related to investment, management, use of state capital in state enterprises.

Chapter II

REMITANCE INTO STATE BUDGET FOR PROFITS AFTER TAX REMAINING AFTER MAKING DEDUCTIONS FOR FUNDS OF ENTERPRISES THAT THE STATE HOLDS 100% OF WORKING CAPITAL

Article 3. Subjects that remit remaining profits after tax into state budget after making deductions for funds

Enterprises remitting the remaining profits after tax after making deductions for funds in this chapter are enterprises that the state holds 100% of working capital as stipulated under Clause 1 Article 2 Chapter I of this Circular (including enterprises established and managed by political organizations, political and social organizations; national defense and security sectors as stipulated under the Decree No. 93/2015/ND-CP dated October 15, 2015 of the Government on organization, management and operation of the national defense and security sectors).

For lottery enterprises, distribution of profits and remittance of profits after tax remaining after making deductions for funds according to specific guidelines of the Ministry of Finance.

Article 4. Determination of remaining profit after tax remaining after making deductions for funds to remit into state budget

1. Remaining profit after tax after making deductions for funds as stipulated under Clause 1 Article 2 Chapter I of this Circular is the profit determined according to the law on accounting (deducted expenses that are not deducted when determining enterprise income tax but it is in accordance with the law on accounting) after offsetting the previous year’s losses as stipulated by the law, deducting the scientific and technological investment fund, paying enterprise income tax as stipulated by the law, deducting for distribution, making deductions for funds as stipulated under the Decree No. 91/2015/ND-CP dated October 13, 2015 of the Government on investment of state capital in enterprises and management and use of capital and assets at enterprises; the Circular No. 219/2015/TT-BTC dated December 31, 2015 of the Ministry of Finance guiding a number of contents of the Decree No. 91/2015/ND-CP  dated October 13, 2015 on investment of state capital in enterprises and management and use of capital and assets at enterprises.

For specific cases as stipulated by Government on distribution, deduction of funds, it shall be implemented according to specific regulations as stipulated by the Government, profit after tax remaining after distributing, making deductions for funds to remit into state budget.

2. For profit after tax remaining after making deductions for funds of subsidiaries that parent companies hold 100% of working capital:

Based on financial regulations of subsidiaries promulgated by parent companies, parent companies shall approve financial statements and decide on distribution, use of profit after tax at subsidiaries to collect profit after tax of subsidiaries.

Subsidiaries that parent companies hold 100% of working capital (parent companies are under the subjects as stipulated under Article 3 of this Circular) shall remit remaining profit after tax after making deductions for funds to parent companies, parent companies shall finalize income to determine remaining profit after tax after making deductions for funds to remit into state budget as stipulated.

Example 1: Corporation A is parent company that holds 100% of working capital of Company B. Remaining profit after tax after making deductions for funds according to the 2016 finalization statement of Company B has to be paid for Corporation A is 1000 billion dong. Corporation A finalizes profit after tax remaining after making deductions for funds in 2016 that has to be paid by Company B is 1000 billion dong to determine profit after tax remaining after making deductions for funds to remit into state budget in 2016 of Corporation A.

After approving the financial statement, decision on distribution of profit after tax and collection of the remaining profit after tax after making deductions for funds of subsidiaries that owner capital of subsidiaries is higher than working capital approved by parent companies, parent companies shall collect the difference amount between the owner capital and working capital of subsidiaries and finalize it as financial revenue of parent companies, determine the remaining profit after tax after making deductions for funds that parent companies have to remit into state budget.

3. For dividends, profits earned from joint stock companies, limited liability companies with two members or more that capital is contributed by parent company:

Parent company shall finalize dividends, profit earned from joint stock companies, limited liability company with two members or more that capital is contributed by parent company into financial income, determine remaining profit after tax after making deductions for funds to remit as stipulated. The time to finalize dividends, profit to be divided into profit of parent company is the time of receiving the notification on sharing dividends, profit of the Board of Management (for dividends divided in joint stock companies) or the Resolution of the Board of Members approved by members (for profits divided at limited liability company with two members or more).

Example 2: Company C is the parent company that holds 60% working capital at D Joint Stock Company. On April 15, 2016, this company organizes the meeting of shareholders and promulgates the Resolution of the general meeting of shareholders, of which promulgates the decision on dividing dividends from business activities in 2015, the time of receiving money is July 01, 2016. On June 20, 2016, the Management Board of Company D issues the notification on dividing dividend to send to shareholders. Company C finalizes financial income for earned dividend at the time of notification from Company D (June 2016) to determine remaining profit after tax after making deductions for funds of Company C in 2016.

Parent companies that contribute capital in joint stock companies, limited liability companies with two members or more shall decide on paying dividends when meeting requirements as stipulated by the enterprise law; at the same time request joint stock companies, limited liability companies with two members or more to remit dividend, profit amounts earned from contributed capital of parent company to parent company.

If joint stock companies, limited liability companies with two members or more that parent companies contribute capital violate the time of dividing dividend, profit as stipulated under the enterprise law, parent company shall report the Ministry of Finance and management agencies to handle in accordance with the law.

If parent company receives shares from joint stock companies where it contributes capital without payment due to joint stock company uses capital gains, funds under the ownership capital or divide dividend by shares to increase working capital, enterprises shall base on the number of shares received to open accounting book to supervise, record and report in financial statement as stipulated under the current accounting regime for enterprises.

Article 5. Declaration, remittance into state budget for profit after tax remaining after making deductions for funds

1. Declaration, remittance of profit after tax remaining after setting up funds

a) Quarterly, based on the business activities, enterprises shall remit profit after tax remaining after setting up funds to remit into state budget of the quarter no later than the thirtieth of the next quarter arising the obligations of paying profit after tax remaining after setting up funds,

b) When the fiscal year is done, based on the financial statements, enterprises shall finalize remaining profit after tax after setting up funds to remit into state budget according to the Form No. 01/QT-LNNC promulgated together with this Circular and pay profit after tax remaining after setting up funds that need to be remitted (if any) no later than the ninetieth since the last day of fiscal year.

At the time of finalizing remaining profit after tax after making deductions for funds, there is no announcement on ranking of enterprises of owners, the ranking of enterprises shall be based on the report that enterprises send to the owner. If the report on ranking has not been sent to the owner yet, enterprises shall rank themselves as a base to set up funds and determine profit after tax remaining after setting up funds to remit into state budget.

After decision on ranking enterprises is announced by owners, if there is any change on enterprise ranking, the enterprise shall re-determine the fund and profit after tax remaining after setting up funds that have to remit into state budget to adjust profit after tax remaining after setting up funds and pay the increasing amount (if any) into state budget as stipulated.

When the finalization of the year is done or decision of owners on enterprise ranking is announced, if profit after tax remaining after setting up funds that has been remitted into state budget is higher than the actual amount that has to be remitted, enterprises shall be deducted in the next payment.

c) If enterprises process merger and acquisition, equalization or termination of operating as one member limited liability company, enterprises shall declare the finalization of profit after tax remaining after making deductions for funds till the time of merger and acquisition, equalization or termination of operating as one member limited liability company and remit profit after tax remaining after making deductions for funds that need to be remitted into state budget no later than the forty-fifth since the day of merger and acquisition, equalization or termination of operating as one member limited liability company according to the decision of competent agencies.

2. Responsibilities of submitting the declaration form of profit after tax remaining after making deductions for funds to tax agencies:

Enterprise shall declare, submit the declaration form of profit after tax remaining after making deductions for funds that need to be remitted into state budget to tax agencies by electronic form.

Article 6. Distribution of state budget

a) Profit after tax remaining after setting up funds to remit into state budget as stipulated under this Article of central enterprises shall be distributed 100% into central budget. Enterprises shall remit into state budget at transaction office of the central state treasury.

b) Profit after tax remaining after setting up funds to remit into state budget as stipulated under this Article of local enterprises shall be distributed 100% into local budget. Enterprises shall remit into state budget at state treasury of provinces, cities that are under the central management where enterprises are located.

Article 7. Handling with violations for acts of late submission of dossier on declaration of remaining profit after tax after setting up funds and late submission of remaining profit after tax after setting up funds into state budget

1. Enterprises that are late for submission of dossier on declaration of remaining profit after tax after setting up funds compared with the deadline as stipulated under Article 5 Chapter II of this Circular shall be fined for acts of late submission as stipulated under the law on tax management.

2. Profit after tax remaining after setting up funds to remit into state budget is revenue of state budget. Enterprises being under subjects of remitting profit after tax that remain after setting up funds shall remit correctly, timely profit after tax that remains after setting up funds to remit into state budget as stipulated under this Circular.

Enterprises that are late for remittance of profits after tax remaining after setting up funds to remit into state budget shall pay an amount for late payment into state budget according to the law on tax management, the law on amending and supplementing a number of articles of the law on tax management.

3. If the total remaining profit after tax after making deductions for funds that are temporarily paid in the fiscal year is 20% or more lower than the profit after tax remaining after setting up funds, enterprises shall have to pay for late payment for the differences from 20% or more between the amount that has to be paid according to the finalization and the temporarily paid amount from the day after the deadline of Quarter IV till the actual day of paying profit after tax remaining after setting up funds that are deficient compared with the amount of finalization.

Example 3: Profit after tax remaining after setting up funds of Company E that has to be paid in 2016 is 100 billion dong. In the year, Company E has paid for 4 quarters of 2016 is 70 billion dong. The differences between profit after tax remaining after setting up funds according to the finalization and paid amount is 30 billion dong (increased by 30%). 20% of profit after tax remaining after setting up funds that shall be remitted is 20 billion dong. The difference from 20% or more is (30 billion dong – 20 billion dong) is 10 billion dong. Company E shall pay the difference that is 30 billion dong into state budget on March 31, 2017. Therefore, Company E shall pay for late payment of the difference from 20% or more is 10 billion dong since the day after the deadline of payment of profit in Quarter IV, 2016 is from January 31, 2017 to March 31, 2017.

For total profit after tax that remains after setting up funds is 20% lower than the amount that has to pay according to the year finalization that enterprises pay late compared with the deadline, the amount for late payment is calculated from the following day of the deadline to the actual day of payment into state budget.

Example 4: The profit after tax remaining after setting up funds of Company G that must be remitted is 100 billion dong. In the year, Company G has paid for 4 quarters of 2016 is 85 billion dong. The difference between profit after tax remaining after setting up funds that has to be remitted according to the finalization and the amount has been remitted is 15 billion dong (increased by 15%). Company G shall remit the difference of being 15 billion on August 31, 2017. Company G has to pay for late payment of 15 billion dong calculating from the following day of the deadline is from April 01, 2017 to August 31, 2017.

If competent agencies detect that remaining profit after tax after making deductions for funds increases compared with the amount declared, enterprises shall have to pay for late payment for the entire remaining profit after tax after making deductions for funds that have to be paid calculating from the following day of the deadline of paying remaining profit after tax after making deductions for funds according to the finalization or till the time of terminating operation as one member limited liability company till the actual day of paying remaining profit after tax after making deductions for funds.

4. In the case after the decision on ranking enterprises of owners, profit after tax remaining after setting up funds that have to be remitted increases compared with the amount that is declared, enterprises shall pay profit after tax after setting up funds into state budget. If remaining profit after tax after making deductions for funds is increasing due to adjustment on results of ranking enterprises according to announcement of owners from the following day of the deadline of paying remaining profit after tax after making deductions for funds till June 30, it is the time to announce the ranking results of owners as stipulated under the Decree No. 87/2015/ND-CP dated October 06, 2015 of the Government, enterprises shall not remit for late payment.

Example 5: At the time of submitting finalization dossier for profit after tax remaining after setting up funds of year 2016 (March 31, 2017), Company H determines that the amount of money shall be remitted according to the finalization is 230 billion dong after setting up funds as stipulated on the basis of enterprise self- ranking (type A). The enterprise remits 230 billion dong into state budget on March 31, 2017. Till June 30, 2017, the owner of Company H publishes that Company H is ranked into type B, based on that, Company H adjusts to decrease the fund and re-determine remaining profit that need to be paid in 2016 is 280 billion dong. Company H shall not pay for late payment from April 01, 2017 to June 30, 2017 for the increasing amount of 50 billion dong due to the adjustment of enterprise ranking.

The rate for late payment shall be implemented according to the law on tax management. The amount for late payment used from development investment fund of enterprises shall be deducted according to regulations under the Decree No. 91/2015/ND-CP dated October 13, 2015 of the Government on investment of state capital in enterprises and management and use of capital and assets at enterprises.

Chapter III

REMITTANCE INTO STATE BUDGET FOR DIVIDENDS AND PROFITS EARNED FROM STATE CAPITAL IN JOINT STOCK COMPANIES, LIMITED LIABILITY COMPANIES WITH TWO MEMBERS OR MORE THAT STATE CAPITAL REPRESENTATIVES ARE MINISTRIES, SECTORS, LOCALITIES

Article 8. Dividends and profits earned must be remitted into state budget as stipulated under this Chapter including:

- Dividends earned in the fiscal year (including dividends of fiscal year temporarily earned in the year and dividends of previous years earned in the fiscal year) for state capital contribution according to the Resolution of General Meeting of Shareholders or Board of Management of Joint Stock Companies as stipulated under Clause 2 Article 2 of this Circular;

- Dividends earned in the fiscal year (including profits of fiscal year temporarily earned in the year and profits of previous years earned in the fiscal year) for state capital contribution according to the Decision of Board of Members of Limited Liability Companies with two members or more as stipulated under Clause 3 Article 2 of this Circular.

Article 9. Declaration, remittance into state budget for dividends, profit earned

1. Declaration, remittance of dividends, profits earned: enterprises as stipulated under Article 8 of this Circular shall declare dividends, profit amounts for state capital contribution according to the Form No. 01/CTLNDC promulgated together with this Circular and remit into state budget within 45 days since the notification on dividing dividends, profits of Joint Stock Companies, Limited Liability Companies with two members or more is received.

2. Responsibilities of submitting the declaration form to tax agencies:

Joint stock companies, limited liability companies with two members or more as stipulated under Article 8 of this Chapter shall submit the declaration form on dividends, profits earned to tax agencies by electric forms.

Article 10. Division of state budget

a) Dividends, profits earned from state capital contribution of joint stock companies, limited liability companies with two members or more that capital contribution is represented by ministries, sectors shall be divided 100% into central budget. Enterprises shall remit into central budget at transaction office of the Central State Treasury.

b) Dividends, profits earned from state capital contribution of joint stock companies, limited liability companies with two members or more that capital contribution is represented by localities shall be divided 100% into local budget. Enterprises shall remit into state budget at State Treasury of provinces, cities that are centrally managed where enterprises are located.

Article 11. Handling with acts of violation for late submission of declaration dossier on dividend and profit earned and late submission of dividend and profit earned into state budget

1. Enterprises that are late for submission of declaration dossier on dividend and profit earned from state capital contribution compared with the deadline as stipulated under Article 9 Chapter III of this Circular shall be fined for acts of late submission as stipulated under the law on tax management.

2. Dividends, profits earned from state capital contribution as stipulated under this Chapter is the revenue of state budget. Enterprises being subjects of remitting dividends, profits earned from state capital contribution shall remit correctly, timely the dividend, profit amounts earned from state capital contribution as stipulated under this Circular.

Enterprises that are late for remittance of dividends, profits earned from state capital contribution shall pay an amount for late payment into state budget according to the law on tax management, the law on amending and supplementing a number of articles of the law on tax management.

3. The time to calculate the amount of late payment shall be from the deadline as stipulated under Clause 1 Article 9 of this Chapter.

The rate for calculating the late payment shall be implemented according to the law on tax management. The amount of payment shall be used from profit after tax of enterprise income tax of joint stock companies, limited liability companies with two members or more that capital is contributed by the state of the following term shall base on amount of late payment into state budget.

Example 6: Company E is a joint stock company that is contributed by the state and is represented by the Ministry of Industry and Trade. On April 15, 2016, Company E organized the general meeting of shareholders and on July 01, 2016, this company notified to divide dividends of business activities for 2015 to shareholders, of which dividends shared to state capital contribution is 130 billion dong. Company E has to declare, remit to state budget the dividend amounts earned from state capital is 130 billion dong no later than August 14, 2016. On September 15, 2016, Company E remitted the dividend amounts into state budget, so Company E has to pay an amount for late payment from August 15, 2016 to September 15, 2016. Documents for late payment are written on Septembers 15, 2016, amounts for late payment shall be used from profit after tax in 2016 of Company E.

Chapter IV

IMPLEMENTATION PROVISIONS

Article 12. Effect

This Circular takes effect on May 26, 2016 and applies for year from 2016.

Article 13. Implementation responsibilities

1. Ministries, sectors, People Committees of provinces and cities that are under the central management under its competence shall direct state capital representatives invested at enterprises under its authority to supervise, guide enterprises to declare, remit revenue of state budget as stipulated under this Circular.

2. State capital representatives at joint stock companies, limited liability companies with two members or more that capital is contributed by the state shall vote on paying dividends when meeting requirements as stipulated by enterprise law; at the same time request joint stock companies, limited liability company with two members or more to declare, remit dividends, profit earned from state capital to remit into state budget as stipulated.

If joint stock companies, limited liability companies with two members or more that capital is contributed by the state violate the time of paying dividends, profit as stipulated under the enterprise law, state capital representatives shall report to the Ministry of Finance and state capital representative agencies at joint stock companies, limited liability companies with two members or more that capital is contributed by the state for settlement.

3.  Responsibilities of tax agencies at all levels:

Tax agencies shall organize the implementation of management and remittance of remaining profits after tax after setting up funds and dividends, earned profits and guide enterprises that are subjects of remitting remaining profit after tax after setting up funds and dividends, earned profits to implement this Circular.

a) Responsibilities of tax management agencies managing big corporations under the General Department of Taxation:

- Organizing, managing the exploitation of information on sources of state budget invested in enterprises;

- Directly organizing the implementation of collection including: supporting enterprises to declare, remit into state budget, inspect, supervise the remittance for profit after tax remaining after making deductions for funds to remit into state budget of enterprises 100% held by the state managed by the central (including SCIC); dividends, profit earned by joint stock company, limit liability company with two members or more that capital is contributed by the state and the ownership representatives are ministries, sectors.

- Directing management of collection profit after tax remaining after making deductions for funds and dividends, profit earned to remit into state budget for enterprises under the management of local tax agencies as stipulated under Point b Clause 3 of this Article; coordinating with local tax department to inspect, supervise the remittance, collection of profit after tax remaining after making deductions for funds for enterprises under the management of local tax department as stipulated under Point b Clause 3 of this Article.

b) Responsibilities of local tax department

- Directly organizing the management of remittance for profit after tax remaining after making deductions for funds to remit into state budget of enterprises that the state holds 100% of working capital and are managed by the local. Dividend, profit earned from state capital of Joint Stock Company, Limited Liability Company with two members or more that the state contributes capital and the ownership representative is the local.

- Timely collecting, supervising, inspecting the collection, remittance into state budget for profit after tax remaining after making deductions for funds and dividends, profit earned to remit into state budget of enterprises that tax agencies directly organize the management of collection;

4. Ministers, heads of ministerial-level agencies, heads of government-attached agencies, and chairpersons of provincial-level People’s Committees shall direct agencies, organizations, individuals to implement this Decree.

On the course of implementing, any arising problems should be timely reported to the Ministry of Finance for settlement.

For Minister

Deputy Minister

Do Hoang Anh Tuan

* All Appendices are not translated herein.