WILL BUSINESS HOUSEHOLDS NOT CARRYING OUT THE PROCEDURES FOR TEMPORARY CLOSURE BE FINED?

My family is doing business under a business household. In near future, we will temporarily shut down our business. I would like to ask if my household need to carry out the procedure of temporary shut down. Will we be fined if we don’t complete that procedure? Thank you.

FDVN’s Opinions:

Thank you for concerning our legal service. Regarding your case, we would like to provide you with our legal opinions

[1]. Law provisions on the registration of business suspension

According to Article 91 of Decree No. 01/2021/NĐ-CP on business suspension of business household,

“1. If the suspension period is 30 days or longer, the household business must send a notification to the business registration authority of district where it was registered and its supervisory tax authority.

2. If the household business suspends business or resumes its business ahead of the notified schedule, the household business shall send a written notification to the business registration authority of district where it was registered at least 03 working days before the planned date of business suspension or resumption of business ahead of the notified schedule. Such notification must be enclosed with the copy of the minutes of the meeting of family household members on business suspension or resumption of business ahead of schedule if the household business is established by family household members. When receiving the notification, the district-level business registration authority shall give a confirmation slip to the household business. Within 03 working days from the receipt of the valid application, the district-level business registration authority shall issue a certificate of registration of business suspension or certificate of registration of resumption of business ahead of the notified schedule to the household business.”

Accordingly, if your business household suspends for more than 30 days, you must register the suspension at the business registration authority of district and its supervisory tax authority.

[2]. Administrative sanctions in case of not carrying out procedures for business suspension

In case a business household suspends its business for more than 30 days but does not carry out the procedures for the suspension, according to Article 42 of Decree No. 50/2016/NĐ-CP on the violations against regulations on business household suspension:

“1. A warning or A fine of VND 500,000 - VND 1,000,000 shall be imposed for suspending the business without sending a written notification or punctually sending a written notification to the business registration authority of the district where the business household was registered.

2. A fine of VND 1,000,000 - VND 2,000,000 shall be imposed for any of the following violations:

a) Failure to inaugurate the business within 06 months from the issuance date of the certificate of business household registration;

b) Suspending the business for more than 6 consecutive months without notifying the business registration authority of the district.

3. Remedial measure: Send a notification to the business registration authority of the district in case of the violation specified in Clause 1 of this Article.”

Above are the consulting opinions as well as the subjective view of FDVN related to your consulting request based on studying the legal regulations. FDVN hopes that our advice will be useful to you.

Ngô Thị Mỹ Trâm – FDVN Law Firm

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