Official Letter No. 23613/CT-TT&HT (OL 23613): VAT refund on returned goods

On 28th December 2018, Binh Duong Department of Taxation issued OL 23613 and answered on a specific case with the following content:

From 1st February 2018, a Company imported materials for production and paid import tax as well as VAT on these goods. The Company later found that these goods are not in good condition and made an agreement with the oversea supplier to return the goods. In this case, this OL states that the Company shall follow procedures to get refund on VAT for these goods as guided at Article 2 of Circular No. 25/2018/TT-BTC issued by the Ministry of Finance.

Official Letter No. 81260/CT-TTHT (OL 81260): CIT treatment of advertisement activities on Google and Facebook

On 11th December 2018, Hanoi Department of Taxation issued OL 81260 which handles a case where a company runs advertisement activities on Facebook and Google to support the business activity of the company. The payment was made by the employee’s credit card.

The advertisement expense is treated as deductible expense for CIT purpose if the company has an appropriate invoice that contain the name, address and tax code of the company (if the supplier cannot issue an invoice, the company must show the proof of FCT filing and relevant payment voucher) as well as accounting documents and payment support as regulated by the law on VAT.

In this case, the company authorized an employee to use his/her credit card to pay and then, the company paid back to the employee from the bank account of the company. If this payment method is stated in the financial regulation of the company as well as authorization letter and the company has enough documents to prove that the payment was made for business purpose, the above mentioned payment method is conformable with regulations about non-cash payment. The company must have the list of credit card accounts of employees who are authorized to apply this payment method and provide it to the tax office when requested.

Decree No. 157/2018/ND-CP (Decree 157): Increase in minimum monthly wage

On 16th November 2018, the Government issued Decree 157 guiding the increase in minimum monthly wage for employees. The increase was from VND 160,000 to VND 200,000 depending on the location where the company operates.

This Decree comes into force from 1st January 2019.