If a business household temporarily suspends business for more than 6 months without notifying the Business Registration Authority, will it be handled?

How are business households regulated?

According to Article 79 of Decree 01/2021/ND-CP regulating business households as follows: following:

“Article 79. Household business

1. A business household is established by an individual or household members who are registered and responsible with all their assets for the business activities of the household. In case household members register a business household, they authorize one member to act as the business household representative. The individual registering the business household, the person authorized by the household members The family authorized to act as a representative of the business household is the owner of the business household.

2. Households engaged in agricultural, forestry, fishery, salt production, street vendors, street vendors, mobile traders, seasonal businesses, and service providers with low incomes do not have to register as business households, except in cases of conditional business investment and business sectors that are regulated by the People’s Committee of the province or centrally run city applicable on a local scale.”

What rights and obligations do business owners have?

Business household owners enjoy the rights and are responsible for performing their obligations as prescribed in Article 81 of Decree 01/2021/ND-CP as follows:

– The business household owner shall carry out tax obligations, financial obligations and business activities of the business household in accordance with the provisions of law.

– The business household owner represents the business household as a requester to resolve civil matters, plaintiff, defendant, person with related rights and obligations before the Arbitrator, Court and other rights and obligations according to the provisions of law.

– The business household owner can hire others to manage and operate the business household’s business activities. In this case, the business household owner and household members participating in business household registration are still responsible for debts and other property obligations arising from business activities.

– The business household owner and household members participating in household business registration are responsible for the business activities of the business household.

– Other rights and obligations according to the provisions of law.

What procedures must a business household that temporarily suspends operations follow?

In case a business household temporarily suspends business, notification must be made as prescribed in Article 91 of Decree 01/2021/ND-CP as follows:

– In case of temporary business suspension for 30 days or more, the business household must notify the district business registration authority where the business has been registered and the tax agency directly managing it.

– In case a business household temporarily suspends business or resumes business before the announced deadline, the business household sends a written notice to the district business registration authority where the business household has registered at least 03 working days before suspending business or resuming business before the announced deadline. The notice must be accompanied by a copy of the meeting minutes of household members on registration of temporary business suspension or resumption of business before the notified deadline in case household members register for business. After receiving the notice, the district-level Business Registration Authority will issue a receipt to the business household. Within 03 working days from the date of receiving the valid dossier, the district business registration authority shall issue a confirmation of the business household’s registration to temporarily suspend business, and a confirmation of the business household’s registration to resume business before the deadline notified to the business household.

Based on the above regulations, business households are responsible for notifying the district business registration authority where the business has been registered and the tax agency directly managing it in case of business suspension for 30 days or more.

If a business temporarily suspends operations without notice, will they be fined?

Pursuant to point c, Clause 1, Article 63 of Decree 122/2021/ND-CP stipulating penalties for the act of temporarily suspending business without sending a written notice to the district-level business registration authority where registered, the specific penalty is a fine from 5,000,000 VND to 10,000,000 VND.

In addition to the above fine, business households that commit violations are also subject to the remedial measure of being forced to notify the district-level business registration authority of business suspension as prescribed in Point b, Clause 2, Article 63 of Decree 122/2021/ND-CP.

Note: This fine applies to individuals according to Clause 2, Article 4 of Decree 122/2021/ND-CP.

Thus, in case a business household temporarily suspends business for 30 days or more, it must notify the district business registration authority where the business has been registered and the tax agency directly managing it. If this notification obligation is violated, the business household will be fined according to the provisions of law.