Newsletter

Official Letter No.92/TCT-KK about declaration on omitted VAT invoices

On 10^th January 2017, the General Department of Taxation issued Official Letter No.92/TCT-KK about declaration on omitted VAT invoices. Detail of the letter is as follows:

In case taxpayers find that the tax declaration already submitted to the tax authority incorrect after the deadline for submitting the tax declaration, taxpayers may make adjustments to the tax declaration submitted. The adjusted tax declaration may be submitted to the tax authority on any working days, regardless of the deadline for submitting the next tax declaration, but before the tax authority or competent authority announces the decision on tax inspection.

After the tax authority or competent authority makes a conclusion or a decision on tax inspection, in case taxpayers find that the tax declaration for the period which was submitted and inspected still incorrect, taxpayers may make adjustments; the actions of tax authority shall depend on each circumstance.

Official Letter No. 158/TCT-CS on accounting for welfare expenses

On 12^th January 2017, the General Department of Taxation issued Official Letter No. 158/TCT-CS providing guidance on accounting for welfare expenses. Details are as follows:

Enterprises are allowed to include welfare expenses, which regulated in Paragraph 4, Article 1 of Decree No. 91/2014/ND-CP dated 1^st October 2014, paid directly for employees, into expenses for tax purpose when calculating Corporate Income Tax, provided that the payment has sufficient invoices and evidences, and the amount paid does not exceed the employee’s current tax period’s monthly averaged salary.

Official Letter No. 180/TCT-CS on policy of taxation for motorcycle insurance cost

On 16^th January 2017, the General Department of Taxation issued Official Letter No. 180/TCT-CS to answer Official Letter No. 4772/CT-KTT2 dated 2^nd November 2016 of Da Nang Taxation Department on policy of taxation for motorcycle insurance cost:

When enterprises have welfare expenses which are directly paid for employees and comply with Article 4 of Circular No. 96/2015/TT-BTC dated 22^nd June 2015 issued by the Ministry of Finance on deductible expenses when determining taxable income, the General Department of Taxation agrees with the opinion of Da Nang Taxation Department mentioned in the Official Letter No. 4772/CT-KTT2, accordingly, those expenses for welfare are treated as deductible expenses when calculating taxable income, and the enterprises are allowed to deduct  input VAT of those expenses in case they meet the condition of deduction as regulated.

Official Letter No. 208/TCT-DNL about Value Added Tax

On 17^th January 2017, the General Department of Taxation issued Official Letter No.208/TCT-DNL on VAT of transportation fee support. Details are as follows:

Based on Paragraph 5, Circular 219/2013/TT-BTC dated 31^st December 2013, in case an enterprise provides support to its agencies by paying for transportation in order to increase sales, the agencies are responsible for issuing VAT invoices to the enterprise to declare and pay its VAT in accordance with current regulations.

Official Letter No. 269/TCT-KK on declaration of VAT for an investment project

On 20^th January 2017, the General Department of Taxation issued Official Letter No. 269/TCT-KK providing guidance on declaration of VAT for an investment project. Details are as follows:

In case a company has an unfinished cassava powder processing investment project (still under construction and is not ready to operate), the company must prepare separately tax declaration dossier for the project using form 02/GTGT, and transfer the balance of the input VAT of the investment project to the output VAT of business operation. After transferring, if the balance of the investment project’s input VAT remains larger than VND 300 million, the remaining amount is eligible for tax refund.

The company set up a branch with an independent accounting system. The branch has its own legal stamp, keeps its own books in accordance with accounting regulations, and has a bank account. The branch has adopted the deductible VAT method and pays its taxes to the local tax authority.

By the end of October 2016, the company had not filed for tax refund for the above-mentioned investment project, but has completed business registration procedures for establishing the branch. Accordingly, the company must issue VAT invoices in order to transfer the project’s assets to the branch so that the branch can declare and pay VAT.

Official Letter No.3858/CT-TTHT about tax policy

On 25^th January 2017, Hanoi Taxation Department issued Official Letter No.3858/CT-TTHT with the notable points as follows:

Previous year, a company recorded in accounting book foreign exchange gain from the year-end revaluation of monetary items denominated in foreign currency including bank deposit and receivables, and adjusted this gain in item [B11] – Other adjustment of decreasing taxable income on form 03/TNDN – Corporate Income Tax finalization. Next year, the company should adjust only gain resulted from the previous year’s revaluation of receivables in item [B7] – Other adjustment of increasing taxable income on form 03/TNDN, starting from the time of transaction until being revaluated. The company must calculate realized foreign exchange gain which is not yet included in the previou year’s taxable income for each receivables and payables.

In case tax payers find any errors on tax declaration that has been submitted to the tax authority, tax payers may make adjustments before the tax authority announces a decision on tax inspection.