Registering an individual business household is a critical step to legalize business activities, particularly for small-scale operations. This article outlines the detailed procedure and process for registering an individual business household in accordance with current Vietnamese law (as of April 27, 2025), based on the Enterprise Law 2020 (No. 59/2020/QH14), Decree 01/2021/NĐ-CP on enterprise registration, and related legal documents.
Mục lục bài viết
1. What is an Individual Business Household?
According to Clause 1, Article 79 of Decree 01/2021/NĐ-CP, an individual business household is established by an individual or members of a household who register and are liable for all business activities with their entire assets. In cases where household members register the business household, they authorize one member to act as the representative. The individual registering the business household or the authorized representative of the household members is deemed the owner of the business household.
2. Conditions for Registering an Individual Business Household
Under Article 80 of Decree 01/2021/NĐ-CP, Vietnamese citizens or household members with full civil act capacity, as stipulated by law, are eligible to register an individual business household. However, this right does not apply to:
- Individuals under 18 years old, those with restricted or no civil act capacity, or those who have difficulty controlling their actions.
- Individuals under criminal prosecution, serving a prison sentence, subject to special administrative measures (e.g., mandatory education or rehabilitation facilities), or prohibited from practicing a profession by a court ruling.
- Other cases as stipulated by relevant laws.
Additionally, each individual or household is permitted to register only one individual business household nationwide. However, they may still invest, purchase shares, or contribute capital to other enterprises as individuals. The person registering the business household cannot simultaneously be the owner of a sole proprietorship or a general partner in a partnership, unless approved by the remaining general partners.
3. Procedure and Process for Registration
Step 1: Prepare the Dossier
According to Article 87 of Decree 01/2021/NĐ-CP, the dossier for registering an individual business household includes:
- An application for registration of the business household (as per Form II-1 issued with Decree 01/2021/NĐ-CP), including:
- Name of the business household.
- Address of the business location.
- Business industry/sector.
- Business capital.
- Personal information of the business owner (full name, ID card/Citizen Identification Card number, permanent address).
- A valid copy of the ID card, Citizen Identification Card, or passport of the business owner.
- A lease agreement for the business location or documents proving the right to use the location (e.g., land use right certificate or property ownership certificate) as per Article 82 of the Enterprise Law 2020.
- Additional documents (if the business sector is listed in Appendix IV of the Investment Law 2020 as a conditional sector, e.g., food safety permit, professional certificate).
Step 2: Submit the Dossier
- Submission Location: The Finance and Planning Division of the People’s Committee at the district level where the business location is situated, as per Article 86 of Decree 01/2021/NĐ-CP.
- Submission Methods:
- In person at the district-level People’s Committee.
- Online via the National Public Service Portal (https://dichvucong.gov.vn) or local public service portals, as per Decree 107/2021/NĐ-CP on administrative procedure reforms.
- Fees: Approximately VND 100,000, as per Circular 85/2019/TT-BTC (fees may vary by locality).
Step 3: Dossier Processing
- The registration authority reviews the validity of the dossier as per Article 88 of Decree 01/2021/NĐ-CP.
- Processing Time: Within 3 working days from the receipt of a complete and valid dossier. If the dossier is invalid, the authority will issue a written notice for supplementation or correction.
- In case of rejection, the authority must provide clear reasons as per Article 89 of Decree 01/2021/NĐ-CP.
Step 4: Receive Results
- If approved, the applicant receives a Certificate of Business Household Registration (as per Form II-2 of Decree 01/2021/NĐ-CP).
- If rejected, the authority provides a written document stating the reasons.
4. Obligations After Registration
According to Article 90 of Decree 01/2021/NĐ-CP and the Tax Administration Law 2019, obligations include:
- Tax Registration: Contact the district Tax Department to register a tax code and declare taxes as per Article 34 of the Tax Administration Law 2019. Individual business households typically use the presumptive tax method as per Circular 40/2021/TT-BTC.
- Business License Tax: Pay an annual tax ranging from VND 300,000 to VND 1,000,000, depending on revenue, as per Decree 139/2016/NĐ-CP and Decree 22/2020/NĐ-CP.
- Signboard Display: Display a signboard indicating the name, address, and registration number of the business household at the business location, as per Article 83 of the Enterprise Law 2020.
- Legal Compliance: Fulfill obligations related to taxes, financial reporting (if applicable), and regulations governing the business sector.
5. Important Notes
- Business Sector: Verify the list of conditional business sectors in Appendix IV of the Investment Law 2020 to ensure compliance with sub-licensing requirements.
- Information Changes: Notify changes to the name, address, or business sector within 10 days as per Article 91 of Decree 01/2021/NĐ-CP.
- Conversion of Business Type: If the business scale expands, it may be converted to a sole proprietorship or limited liability company as per Article 93 of Decree 01/2021/NĐ-CP.
- E-commerce Websites: If using a website for business, notify or register with the Ministry of Industry and Trade as per Decree 52/2013/NĐ-CP on e-commerce.
Disclaimer:
This article is intended for informational purposes only and does not constitute legal advice from HTH & Partners. The content represents the views of HTH & Partners and is subject to change without prior notice.
The legal provisions referenced in this article were valid at the time of publication but may have been amended or repealed by the time of reading. We strongly recommend consulting a qualified legal professional before applying any information contained herein.
