In recent times, many business owners, particularly those of small and medium-sized enterprises, have faced challenges when attempting to dissolve companies that were established years ago but never became operational. A VnExpress survey of about 1,000 readers on 24/8 revealed that over 50% of respondents were unclear about the procedures required for business dissolution.

The Khanh Hoa Provincial Tax Department recently issued guidance for businesses, branches, and representative offices "no longer operating at their registered address" that intend to dissolve or cease operations.

First, business owners need to verify their tax identification number status. They should also review the information of their legal representative (or authorized person), address, phone number, email, and e-tax transaction account.

Required documents include: the business registration certificate or dependent unit operation certificate; a power of attorney if the person handling the process is not the legal representative; the dissolution decision or notice of operational cessation; and other related papers.

Businesses must complete the procedures to invalidate the tax identification numbers of their dependent units (branches, representative offices, or tax codes for substitute payments) before processing the closure of the parent company's tax identification number.

Next, business owners submit a request to invalidate their tax identification number (Form 24/DKT), either directly to the managing tax authority or via the e-tax portal and the National Public Service Portal.

Upon receiving the application, the tax authority will review the declaration status, invoices, and amounts due to the state budget. Businesses must submit any missing declarations or tax finalization documents, settle invoices, and pay all outstanding taxes, late payment fees, and penalties (if any).

The tax authority advises that all missing declarations for each tax type should be submitted on the same day to minimize late payment penalties.

For businesses involved in import and export activities, obligations to the customs authority must also be addressed. If there are outstanding taxes, late payment fees, or penalties with the customs authority, the business will not receive confirmation of tax obligation fulfillment.

Depending on the risk level, the tax authority may inspect accounting books, invoices, and declaration status. In such cases, businesses must provide accounting books, vouchers, and explanatory documents as requested. Any remaining taxes due, late payment fees, penalties, overpaid amounts, or unclaimed value added tax (VAT) refunds will also be determined during this process. Overpaid amounts may be refunded or offset.

Once a business has fulfilled its financial obligations, the tax authority will issue a confirmation notice and transfer the information to the business registration authority.

Public servants working at the one-stop shop, Da Nang City Administrative Center, 3/2025. Photo: Nguyen Dong

Finally, businesses submit their dissolution application to the provincial business registration authority where their headquarters are located. The application includes documents required for dissolution, and businesses must commit to settling all debts with creditors, employees, and the State (including tax debts, social insurance debts, health insurance debts, and unemployment insurance debts).

Within two working days of receiving the application for feedback, the tax sector will respond, allowing the business registration authority to change the legal status to "dissolved," invalidate the tax identification number, and update it on the system.

Since early July, the Tax Department has instructed localities to mobilize maximum resources for a "tax code cleanup campaign" targeting nearly 620,000 businesses. Of these, approximately 292,000 businesses have ceased operations but have not completed dissolution procedures, and 325,500 businesses are no longer operating at their registered addresses but have outstanding tax debts.

Phuong Dung