Newsletter

Tax Policy

Value added tax (VAT) refund processing

On 31 May 2023, the General Department of Taxation issued Decision No. 679/QD-TCT on VAT refund process; details are as follows:

When a taxpayer submits an online tax refund application via the Portal of the General Department of Taxation (or other Portals), the application shall be processed as follows:

Step 1: Application receipt

The Portal of the General Department of Taxation automatically reviews the documents declared by the taxpayer on the Portal before receiving the application.

Step 2: Issuance of Application receipt notice

The Portal of the General Department of Taxation automatically generates and sends a VAT refund application receipt to the taxpayer within 15 minutes from the time of receiving, in details:

– In case the taxpayer’s VAT refund application is not valid for receipt: Automatically generates and sends a Notice of rejection of VAT refund application according to Form No. 01/TB-HT of Circular 80/2021/TT-BTC to the taxpayer;

– In case the taxpayer’s VAT refund application was received successfully: Automatically generates and sends a Notice of VAT refund application receipt according to Form No. 01/TB-HT of Circular 80/2021/TT-BTC to the taxpayer; the Portal will then assign the application to the correct QHS system.

Step 3: Assign and process applications to the VAT refund application classification department

The QHS system shall automatically notice the VAT refund application classification department according to the instructions in List 3 of Appendix II of Decision No. 679/QD-TCT on VAT refund process (issued in 2023), and immediately process the completed e-application to the VAT Refund subsystem.

No administrative penalties for understating Item [23] “Value of purchased goods and services” on VAT return Form No. 01/GTGT

On 18 January 2023, the General Department of Taxation issued Official Letter No. 192/TCT-PC on declaration of Sales invoices as follows:

Currently, the Law on tax administration does not have regulations on the value of goods and services purchased that must be declared in Item 23 of Form No. 01/GTGT. Therefore, not declaring the value of Sales invoices in Item 23 – “Value of purchased goods and services” of Form No. 01/GTGT is not an administrative violation specified in Article 12 of Decree No. 125/2020/ND-CP dated 19 October 2020 by the Government, and not subject to administrative penalties.

Handling tax debts according to Resolution No. 94/2019/QH14 and Circular No. 69/2020/TT-BTC

On 30 May 2023, the General Department of Taxation issued Official Letter No. 2136/TCT-QLN on handling tax debts according to Resolution No. 94/2019/QH14 and Circular No. 69/2020/TT-BTC; details are as follows:

1. In case a taxpayer has its Enterprise Registration Certificate revoked by a competent authority at the request of a tax authority before 1 July 2020, such case shall be subject to Clause 5, Article 4 of Resolution No. 94/2019/QH14. In case the taxpayer violates the provisions of the laws, leading to a competent authority revoking its Enterprise Registration Certificate not at the request of a tax authority, such case is not eligible for debt settlement as prescribed in Clause 5, Article 4 of Resolution No. 94/2019/QH14.
2. In case a taxpayer has issued a Dissolution decision and submitted such decision to the tax authority, but the Business registration authority has not published on the National Portal for business registration that the taxpayer is undertaking dissolution procedures, such case is not eligible for debt settlement as prescribed in Clause 2, Article 4 of Resolution No. 94/2019/QH14.
3. In case a taxpayer has fled its registered address, and the tax authority has coordinated with the commune-level People’s Committee to verify that the taxpayer no longer operates at its registered address before 1 July 2020 and that the taxpayer is no longer able to make payment to the state budget, such case may be considered for debt settlement as prescribed in Clause 4 Article 4 of Resolution No. 94/2019/QH14.
4. In case a taxpayer is dead, declared dead/missing/incapacitated by a Court of law: The tax authority shall handle tax debts of individual who is dead/missing/civil act incapacitated; debts of enterprises whose owner(s) is/are dead/missing/civil act incapacitated are not handled according to the provisions of Resolution No. 94/2019/QH14.

Debts arising from 1 July 2020 are not within the scope of Resolution No. 94/2019/QH14 and shall not be updated into the TMS system.

Value added tax (“VAT”)

– In case a business entity sells goods or provides services (subject to VAT reduction according to Decree No. 15/2022/ND-CP) but issue VAT invoice after 31 December 2022 for sales of goods and services arising from 1 February 2022 to 31 December 2022; or in case construction and installation activities were accepted and handed over/construction and installation work was completed, regardless of whether cash has been collected, from 1 February 2022 to 31 December 2022 but the entity issued VAT invoice (for the construction work done) after 31 December 2022, such cases are instances of untimely issuance of VAT invoices; the goods and services are eligible for VAT reduction according to Decree No. 15/2022/ND-CP dated 28 January 2022 by the Government, but shall be fined for untimely issuance of VAT invoices.

VAT refund policy

On 31 May 2023, Hanoi Tax Office issued Official Letter No. 37938/CTHN-TTHT regarding VAT refund policy: From 1 May 2018, business establishments may not claim VAT refund for cases where goods were imported and then exported but the exported goods were not exported within customs areas; or goods that were not exported within customs areas according Clause 4, Article 2 of Circular No. 25/2018/TT-BTC.