Bankrupt Enterprises: Tax Debt Write-Off Conditions

An enterprise declared bankrupt by the Court that has made payments in accordance with bankruptcy law but no longer has assets to pay tax shall have its outstanding tax, late payment interest, and fines written off under the Law on Tax Administration 2025 (No. 108/2025/QH15, effective from 01/7/2026, replacing the 2019 Law on Tax Administration).

1. In which cases are tax, late payment interest, and fines written off?

Under the Law on Tax Administration 2025, cases eligible for write-off of tax, late payment interest, and fines include:

• Enterprises and cooperatives declared bankrupt that have made payments in accordance with the law on recovery and bankruptcy but no longer have assets to pay tax, late payment interest, and fines;
• Taxpayers being individuals who have died, lost civil act capacity, or gone missing with no assets left to pay tax;
• Force majeure, natural disasters, and epidemics as prescribed by law;
• Other cases prescribed by the Law on Tax Administration 2025.

Accordingly, an enterprise declared bankrupt that has paid out all assets according to the asset distribution order under bankruptcy law but still owes tax shall have the remaining tax, late payment interest, and fines written off — the taxpayer need not continue to perform this obligation.

Important note: The provisions on tax debt write-off in Articles 85, 86, 87, and 105 of the 2019 Law on Tax Administration ceased to be effective together with that law from 01/7/2026. Readers should not apply the 2019 Law’s provisions to determine the conditions and authority for tax debt write-off.

2. Conditions for a bankrupt enterprise to have tax debts written off

To have tax, late payment interest, and fines written off, an enterprise must meet the following conditions:

• Have an effective court decision declaring bankruptcy (under the 2025 Law on Recovery and Bankruptcy);
• Have fully made payments according to the plan and asset distribution order in the bankruptcy proceedings;
• After payment, the enterprise has no remaining assets to pay the outstanding tax, late payment interest, and fines;
• The write-off application dossier is fully prepared as prescribed (bankruptcy declaration decision, documents proving payments were made and no assets remain, confirmation from the competent authority, etc.).

3. Authority and procedures for tax debt write-off

The authority to decide on writing off tax, late payment interest, and fines is delegated according to the amount written off, from the head of the directly managing tax authority to the Ministry of Finance level for large amounts — under the Law on Tax Administration 2025.

Regarding procedures: the taxpayer or the tax authority prepares the write-off application dossier and sends it to the competent authority for consideration and decision. The write-off decision is issued in writing; after the write-off decision, the tax authority adjusts its books and records tax debt tracking as prescribed.

Notes on applying the current legal regulations

This article belongs to the Corporate & M&A Knowledge group and is presented for reference purposes, helping readers understand the legal issue at an overview level before preparing dossiers or carrying out transactions. Legal regulations may change depending on the time, locality, dossier type, and specific circumstances. Where it is necessary to determine precisely the applicable legal basis for your dossier, you should contact ANT Legal’s lawyers at 0966.475.966 for review and advice before proceeding.

Common risks to note

• Applying the tax debt write-off provisions of the 2019 Law on Tax Administration (which ceased to be effective from 01/7/2026).
• Confusing “insolvent enterprises” with “enterprises declared bankrupt” — only the latter qualify for write-off under this provision.
• Requesting write-off before fully completing payments under the bankruptcy procedure.
• Misunderstanding the conditions, procedures, time limits, or competent authorities.

How can ANT Legal assist?

ANT Legal assists in reviewing specific situations, checking dossiers, determining the applicable legal basis, advising on handling options, and representing you in working with individuals, organisations, or competent authorities where necessary. For prompt advice, you may contact our lawyers at 0966.475.966.

Related articles

• If a Company Owing Social Insurance Goes Bankrupt, Are Employees’ Rights Protected?
• May a Branch Use the Enterprise’s Tax Code for Tax Obligations?
• 7 Things to Do Immediately After Establishing an Enterprise in Vietnam