Tax: The biggest obstacle in the process of enterprise dissolution

Dissolution of an enterprise is the last step to close the entire business operation process, and at the same time terminate the legal existence of the enterprise. In this process, the termination of the tax identification number and the completion of tax finalization are not only mandatory procedures but also a condition for completing the dissolution dossier at the business registration office. However, the practice of implementation at local tax authorities shows that there are still technical and procedural "bottlenecks" at the tax stage, causing the dissolution process to be prolonged and the plan to terminate the operation of the enterprise is significantly affected.

Fulfillment of tax obligations - An indispensable step in the dissolution process

According to the current law, the dissolution of an enterprise is carried out one after another through administratively inherited stages. The first stage is that the enterprise must issue a resolution/decision on dissolution, then send a notice of dissolution to the business registration agency within 07 working days from the date of approval of the resolution/decision on dissolution enclosed with the dossier of notification of dissolution as prescribed[1].

The next stage is for the enterprise to handle debts (if any), liquidate assets, settle benefits for employees, make tax finalization and invalidate the enterprise's tax identification number before submitting the application for registration of enterprise dissolution. Conducting tax finalization at this time is a necessary step to determine the tax obligations that must be fulfilled of the enterprise by the time of the decision on dissolution and termination of the tax identification number. After inspecting and determining that the enterprise no longer has any outstanding tax obligations, the tax authority will issue a Notice of the taxpayer's fulfillment of the tax payment obligation and update the status of the taxpayer ceased operation and has completed the procedures for invalidation of the tax identification number ("Status 01") for the enterprise to continue the on-site dissolution process business registration authority (submission of dissolution registration dossiers).

Finally, the business registration authority will check the tax status of the enterprise through a data system connected to the tax authority. In case the system shows that the enterprise has completed the termination of the tax identification number and considers that the enterprise has met other dissolution conditions such as liquidation of assets, payment of debts, and no more affiliated units that have not yet terminated their operation,... then the business registration authority will update the legal status of the dissolved enterprise on the National Enterprise Registration Portal[2].

The whole process shows that the fulfillment of tax obligations and termination of tax identification numbers of enterprises is not merely a technical administrative procedure, this is also a prerequisite to ensure the legality of the entire process of enterprise dissolution. The fulfillment of tax obligations shows that enterprises have been transparent and clear in performing their financial responsibilities to the State, no longer have outstanding tax debts or financial obligations.  In other words, the enterprise cannot complete the dissolution if it has not been confirmed that it has fulfilled its tax obligations on the tax administration system. This helps prevent enterprises from dissolving "to evade taxes", and at the same time ensures transparency and fairness in tax administration and protection of national budget revenues. Therefore, any problems or delays in carrying out procedures at the tax authority will directly affect the dissolution progress, prolonging the time of business closure.

Common problems with tax procedures in the process of enterprise dissolution

The tax data system has not updated the status after completing the procedures for invalidation of tax identification numbers

One of the problems that businesses often encounter in the process of dissolution is the situation that the electronic tax management system is not properly updated even though the termination of the validity of the tax identification number has been completed. Specifically, when the enterprise has been certified as having fulfilled its tax obligation and has a Notice of Fulfillment of Tax Payment Obligation from the tax authority, the system still maintains the status of the taxpayer has stopped operating but has not completed the procedures for invalidation of the tax identification number ("Status 03") instead of switching to Status 01.

The lack of synchronization in terms of technical and practical processing of tax dossiers has caused the situation that enterprises cannot continue to submit dossiers for registration of dissolution at the business registration office because the system has not accurately updated the tax status of enterprises. When businesses seek support from tax authorities, it is common to receive feedback that the officer in charge does not have the authority to solve technical problems, while it is not clear which department or individual to contact to solve this problem. As a result, the dissolution dossier is "suspended", interrupting the dissolution process of the enterprise even though the cause does not come from the enterprise.

Pending applications due to changes in scope of management

Recently, the process of dissolving enterprises in some localities has faced many difficulties, most of which stem from continuous changes in the organization of the tax administration apparatus and the adjustment of administrative boundaries. Specifically, according to Decision No. 381/QD-BTC dated March 1, 2025 of the Ministry of Finance, a number of tax departments and sub-departments in provinces such as Ninh Thuan, Binh Thuan, Dong Nai and Ba Ria - Vung Tau have been merged into the XV Tax Sub-Department, located in Ba Ria - Vung Tau. However, only a few months later, from July 1, 2025, the adjustment of administrative boundaries according to Resolution 202/2025/QH15 dated June 12, 2025 of the National Assembly continues to change the scope of management of tax authorities: Ba Ria - Vung Tau is merged into Ho Chi Minh City, Binh Thuan is transferred to Lam Dong,  Ninh Thuan merged with Khanh Hoa, while Binh Phuoc merged with Dong Nai. These fluctuations have directly affected the process of processing documents of enterprises at tax authorities, causing disruptions and delays in procedures at relevant agencies.

The two major adjustments that took place in a short time have led to many tax dossiers, including dossiers of tax identification number termination and tax finalization declaration for the dissolution process, being delayed in processing or having to wait for transfer between different tax administration units. In some cases, although the enterprise has completed the procedures and worked with the tax authority, the dossier has not been processed in time because the successor tax authority has not received enough data or needs more time to review and verify information. This situation also has a significant impact on the overall progress of the dissolution procedure, although the enterprise has actively fulfilled its obligations as prescribed.

Adjust the operating process of the system to remove difficulties

Understanding the large workload that tax authorities are having to undertake, especially in the context that the system has to adjust to suit the current administrative and management changes, businesses somewhat sympathize with the difficulties of tax authorities. However, it is undeniable that this stagnation has caused a significant consequence for businesses and more profoundly the general operation of the business environment. Therefore, it is necessary to be aware that this is a dilemma, requiring close coordination and thorough solutions to support businesses and tax authorities.

From the above fact, the tax authority can consider implementing a number of technical and administrative support measures to improve the process of processing dossiers and support the dissolution process of enterprises. Firstly, it is necessary to establish a clearer and more transparent coordination mechanism between professional and technical departments within the agency, especially in updating the tax status after the enterprise has fulfilled its tax obligations. Secondly, it is necessary to review and complete the process of receiving and processing dossiers in the stage of organizational transfer or change of the scope of enterprise management, establish a mechanism to support enterprises in fulfilling tax obligations in general and the dissolution phase in particular in a more focused and effective direction.

During this period, businesses also need to monitor and coordinate with the guidance of tax authorities, comply with obligations as prescribed so that the dissolution process can be carried out smoothly and in the right order. This helps to avoid affecting the internal plan of the business and incurring additional unexpected costs.

In short, dissolution is the last step to end the existence of the enterprise, but that termination needs to be done quickly, transparently, and in accordance with the prescribed legal procedures. Overcoming technical and administrative bottlenecks in the tax process when dissolving an enterprise not only helps protect the legitimate interests of the enterprise but also contributes to imp