Value-added tax
Late invoices for services provided prior to July 2023 will not be subject to the preferential VAT tax rate of 8%.
On August 11, 2023, the Hanoi City Tax Department issued Official Letter No. 58653/CTHN-TTHT guiding the reduction of VAT according to Decree 44/2023/ND-CP as follows: In the case where the company completed the construction work in June 2023 but issued the invoice in July 2023, Issuing the invoice at an incorrect time shall not apply the VAT rate of 8% as regulated in Article 2, Clause 1 of Decree No. 44/2023/ND-CP dated June 30, 2023.
Comply with tax obligations for incorrectly stated tax rates on invoices.
On August 25, 2023, Hanoi City Tax Department issued Official Letter No. 62665/CTHN-TTHT confirming the implementation of tax obligations as follows: In cases where the invoice incorrectly states the tax rate for value-added tax and the enterprise has not self-adjusted, if discovered during tax inspection, if it determines that the seller has declared and paid tax according to the correct tax rate stated on the invoice, the buyer is eligible for input tax deduction based on the tax which is on the invoice, but it must be confirmed by the tax authority directly managing the seller in accordance with the provisions at point b, Clause 5, Article 12 of Circular No. 219/2013/TT-BTC dated December 31, 2013 of the Ministry of Finance.
If the VAT rate states on the purchase invoice is higher than the rate specified in the legal documents on VAT, the input tax credit shall deduct according to the rate specified in the legal documents on VAT.
If the value added tax rate states on the invoice is lower than the tax rate prescribed in the legal documents on value added tax, the input tax credit shall deduct according to the tax rate recorded on the invoice.
The request for confirmation of tax obligations of the seller is mandated by Article 16 of Tax Administration Law No. 38/2019/QH14. The confirmation of tax obligations is processed according to the guidelines in Article 70 of Circular No. 80/2021/TT-BTC dated September 29, 2021.
Processing the error invoice
On August 30, 2023, the Tax Department of Hanoi City issued Official Letter No. 63648/CTHN-TTHT regarding the invoices has errors as follows: In the case where a company supplies goods or services eligible for VAT reduction according to Decree 15/2022/NĐ-CP, if errors discover after December 31, 2022, the company must amend or replace the invoice without affecting the value of the goods and VAT payable, or adjust the price for tax calculation. In this case, the adjusted or replacement invoice will be subject to an 8% VAT rate. In the case of errors in the quantity of goods resulting in errors in the value of goods and VAT, the adjusted or replacement invoice will be subject to the VAT rate regulations at the time of its issuance according to the guidance in Official Letter No. 2121/TCT-CS dated May 29, 2023, by the General Department of Taxation.
In case of return goods, create an invoice with a trade discount on the sale subject to VAT reduction under Decree No. 15/2022/NĐ-CP
On July 19, 2023, the Ho Chi Minh City Tax Department issued Official Letter No. 8999/CTTPHCM-TTHT providing guidance on electronic invoices as follows:
In cases where organizations or individuals purchase goods, the sellers have issued an invoice, and the buyer has received goods, but later discovers that the goods do not meet the specifications or quality, the buyer must return either the entire or a portion of the goods. The seller will then issue a refund invoice to adjust or replace the previously issued the invoice. The seller and the buyer must agree and explicitly state the returned goods in the agreement .
The company is implementing a new investment the project, registered on the investment certificate as an Enterprise Processing Export, but has not verified in practice, so it is not entitled to tax incentives for Enterprise Processing Export.
On August 30, 2023, the Provincial Tax Department of Hai Duong issued Official Letter No. 13277/CTHDU-TTHT providing guidance on tax policies for Enterprise Processing Export as follows: In the case that a company implements a new investment project, which has been registered on the Investment Certificate as an Enterprise Processing Export, during the period in which the Customs agency has not inspected the actual inspection conditions, customs supervision or customs, they shall not be entitled to tax incentives applicable to export enterprises as regulated .
The company issues invoices when selling goods, declares and pays taxes according to the current value-added tax rate. If the company has not submited the value-added tax declaration files within the specified timeframe, it will be subject to administrative penalties for late submission and will be required to submit the tax declaration files to the Taxation Agency as stipulated by Tax management laws and regulations.
In case the company implements a new project with the aim of establishing an enterprise exempt from value-added tax. The input value-added tax of goods and services used for production and business of goods and services exempt from value-added tax cannot be deducted/refunded.
Personal Income Tax
Declaration of personal income tax from inheriting securities
On August 21, 2023, the Hanoi Tax Department issued Official Letter No. 61194/CTHN-TTHT providing guidance on the declaration and payment of personal income tax from inheriting securities as follows: In the case of non-resident individuals who have income from inheriting securities according to the provisions of Clause 9, Article 2 of Circular No. 111/2013/TT-BTC, the individual shall directly declare and pay tax for each occurrence according to the provisions of Point g, Clause 4, Article 8 of Decree No. 126/2020/NĐ-CP. The amount of personal income tax to be declared is determined according to the guidance in Article 23 of Circular No. 111/2013/TT-BTC of the Ministry of Finance.
The declaration of personal income tax for individuals with inheritance income shall be carried out according to the form 04/TKQT-TNCN specified in Annex II, issued together with Circular No. 80/2021/TT-BTC dated September 29, 2021 by the Ministry of Finance. In case individuals use tax agency services to process tax procedures, they shall provide complete information about the tax agency (such as tax identification number, tax agency contract number) on the aforementioned form 04/TKQT-TNCN.
Coporate Income Tax
Tax incentives for investment in ongoing investment development projects
On July 31, 2023, the General Department of Taxation issued Official Letter No. 3246/TCT-CS on corporate income tax policies as follows: In the case of enterprises with ongoing investment development projects such as expanding production scale, increasing capacity, and innovating production technology (collectively referred to as expansion investment projects) within the preferential tax area for corporate income tax if they meet one of the three criteria for expansion investment projects as specified in Point 8, Article 1 of Law No. 32/2013/QH13, they can choose to enjoy the tax incentives for the remaining period of the ongoing project (including tax rates and exemption or reduction periods, if any) or be eligible for tax exemption or reduction based on the additional income generated from the expansion investment (not eligible for preferential tax rates) for the same exemption or reduction period applicable to new investment projects in the same area or field eligible for corporate income tax incentives.
Tax policy for companies that sign contracts with the individuals providing labor
On September 8, 2023, the Hai Duong Provincial Tax Department issued Official Letter No. 13533/CTHDU-TTHT regarding the tax policy as follows: In the case where a company signs a contract with an individual who is not registered for business to provide labor for the company, the income received by the individual is subject to personal income tax from wages and salaries. The company is responsible for withholding personal income tax at the rate 10% before making payment to the individual, regardless of whether the individual represents a group of individuals.
The mentioned expenses are included in the deductible expenses when determining the taxable income of the business, in accordance with Article 4 of Circular No. 96/2015/TT-BTC and with specific supporting documents.
+ The contract of delivery;
+ Liquidation minutes of the contract;
+ Citizen identity card of the worker;
+ Minutes of acceptance of goods or certificate of completion of work;
+ Attendance sheet;
+ Purchase order for the goods, services purchased according to template number 01/TNDN;
+ Payment voucher;
+ Personal income tax deduction documents .
