I. VALUE ADDED TAX
1. Refund of VAT on exports
On November 6, 2024, the General Department of Taxation issued Official Dispatch No. 5025/TCT-KK guiding VAT refunds on exported goods as follows:
In case the information declared on the tax refund application is different from the management information of the tax administration, the tax administration will notify in writing so that the taxpayer can explain and supplement the information. The period of explanation and additional information does not count within the time limit for processing tax refund applications. In case the tax authorities carry out post-reimbursement inspections and checks on documents subject to pre-reimbursement according to the provisions of Article 77 of the Law on Tax Administration No. 38/2019/QH14, the tax authorities carry out a review and reconciliation of payment documents via the taxpayer’s bank. On the basis of the results of the review and reconciliation, the tax authorities determine the tax eligible for refund and process the taxpayer’s tax refund application in accordance with the regulations.
2. VAT policy on exported stone powder products, produced from natural resources and minerals
On November 7, 2024, the General Department of Taxation issued Official Dispatch No. 5055/TCT-CS guiding on the application of VAT policy on exported stone powder products, produced from resources and minerals as follows:
In case Minerals and Import-Export Trading Company Limited buys stone powder products from manufacturing enterprises for export, the application of VAT policy on products exported from resources and minerals of Minerals and Import-Export Trading Company Limited shall comply with the provisions of Decree No. 146/2017/ND-CP dated December 152017 of the Government and guidance in Circular No. 25/2018/TT-BTC dated March 16, 2018 of the Ministry of Finance. In case the selling party’s exported products to Minerals and Import-Export Trading Company Limited are subject to determining the value of resources, minerals and energy costs above the cost of product production, businesses directly producing products are responsible for determining the value of resources minerals plus energy costs on product production costs and provide information for Minerals and Import-Export Trading Company Limited to declare and calculate VAT payment when exporting the above products according to regulations.
3. VAT refund for investment projects
On November 7, 2024, the General Department of Taxation issued Official Dispatch No. 5071/TCT-KK guiding on VAT refund for investment projects as follows:
In case, Thao Nguyen Fashion Company Limited (hereinafter referred to as the Company), Tax code: 0201042585, register to pay VAT according to the deduction method; address Head office in: Hai Phong city; Implementing an investment project to build a Thao Nguyen fashion garment export factory in Thai Binh province.
For the input VAT amount of an investment project directly managed by the Company that is not refundable but is eligible for deduction, the Company may transfer the input VAT amount of the goods, services arising during the investment period have not been refunded for further deduction and offsetting with the amount of VAT payable on production and business activities directly managed by the Company.
4. Concerning VAT refunds on exported goods and services
On November 7, 2024, the General Department of Taxation issued Official Dispatch No. 5245/TCT-CS responding to Hanchangpla Vina Co., Ltd. on VAT policy on exported goods and services as follows:
In case Hanchangpla Vina Co., Ltd. has exported goods and services that are subject to VAT refund for exported goods and services according to VAT laws, meets the conditions for tax deduction and refund and has a tax refund request according to the provisions of law, it will be considered tax refund settlement according to regulations.
5. VAT policy
On November 8, 2024, the General Department of Taxation issued Official Dispatch No. 5102/TCT-CS guiding VAT policy as follows:
Where an undertaking has an investment project for the production of microbiological fertilisers which are not subject to VAT, the input VAT of the investment project shall not be deductible. When an enterprise transfers an investment project to another enterprise to continue implementing a microbial organic fertilizer production project according to the original goal of the project, a tax rate of 10% is applied according to regulations.
6. Determination of VAT refund periods
On November 19, 2024, the General Department of Taxation issued Official Dispatch No. 5309/TCT-KK guiding the determination of VAT refund period as follows:
In case Green Farm Company Limited (MST 3601594402) has both exported goods and services and domestically sold goods and services, the Company must separately account for input VAT used for production and business export goods and services. Where it cannot be accounted for separately, the amount of input value added tax on exported goods and services shall be determined as a proportion of the turnover of the exported goods and services to the total turnover of the goods, the services of value added tax return periods from the tax return period following the previous tax refund period to the current tax refund request period.
7. VAT policy when purchasing and paying for third parties
On December 5, 2024, the Binh Duong Provincial Tax Department issued Official Letter No. 31044/CTBDU-TTHT guiding on tax policies when purchasing goods and paying for a third party as follows:
In case the Company purchases goods and services, the seller requests payment through a bank to a third party designated by the seller, the payment to the designated third party is specifically stipulated in the contract in the form of a document and the third party is a legal entity operating in accordance with the law, at the same time, the payment document shows the content in accordance with the relevant sales contract: “the payment document clearly shows the name of the payer, the name of the beneficiary, the import contract number, the payment value in accordance with the signed import contract and the payment document is in accordance with the provisions of the law on banking” then it meets the conditions for non-cash payment documents to deduct input VAT.
II. PERSONAL INCOME TAX
Personal income tax policy with non-specialized remuneration of members of the Board of Directors
On November 4, 2024, the General Department of Taxation issued Official Dispatch No. 4982/TCT-DNNCN guiding personal income tax policy for non-specialized remuneration of members of the Board of Directors at other enterprises as follows:
In principle, organizations and individuals who directly pay income are responsible for declaring and deducting the tax payable from the taxpayer’s income before paying the income.
III. CORPORATE INCOME TAX
Corporate Income Tax Offset Policy
On November 27, 2024, the Bac Giang Provincial Tax Department issued Official Letter No. 8195/CTBGI-TTHT providing guidance on corporate income tax offset as follows:
In case the Company has an investment project that enjoys corporate income tax incentives due to meeting the conditions for investment incentive sectors. In 2023, the business activities enjoying tax incentives are at a loss, the company’s other business activities are profitable, the Company is allowed to offset against the taxable income of income-generating activities selected by the Company according to the provisions of Clause 9, Article 18 of Circular No. 78/2014/TT-BTC.
In case the Company discovers that the tax declaration submitted to the tax authority contains errors or omissions, it may supplement the tax declaration according to the provisions of Article 47 of the Tax Administration Law No. 38/2019/QH14 and Clause 4, Article 7 of Decree No. 126/2020/ND-CP.
IV. TAX POLICY
1. Sales discounts and trade discounts
On November 5, 2024, the General Department of Taxation issued Official Dispatch No. 4991/TCT-CS guiding tax policy on sales discounts and trade discounts as follows:
In principle, when trade discounts are based on the quantity and sales of goods and services, the discount amount of sold goods is adjusted on the invoice for goods and services of the last purchase or next period. In case the discount amount is prepared at the end of the sales discount program (period), an adjusted invoice will be made with a statement of the invoice numbers to be adjusted, the amount, and the adjusted tax amount. Based on the adjustment invoice, the seller and buyer declare an adjustment of revenue and tax correspondingly
Therefore, in case VHGS Company incurs a discount on sales prices and trade discounts as agreed in the Principle Contract, in accordance with the Goods Sales Contracts signed between VHGS Company and Mordern Fittings Inc, the Company has complete documents and legal guarantees for the accuracy of documents proving the implementation of sales discounts and trade discounts, VHGS Company prepares invoices to adjust according to the legal regulations on goods sales invoices. Based on the adjusted invoice prepared, VHGS Company makes an adjusted declaration of sales revenue according to regulations.
2. Related to depreciation of fixed assets (FA)
On November 22, 2024, the General Department of Taxation issued Official Dispatch No. 5412/TCT-CS responding to Thanh Hoa Petroleum Company Limited on depreciation of fixed assets (FA) as follows:
The registration of Vietnamese ships includes registering to carry the flag of Vietnamese nationality and registering ownership of that ship and only stipulates that ships registered abroad cannot be registered to carry the flag of Vietnamese nationality, without Restrictions on registration of ownership of ships registered abroad. Accordingly, the Company, which is the owner of a ship registered abroad, can also register ownership of the ship in Vietnam, if needed and in accordance with the regulations on ship age limits when registered for the first time. in Article 7 of Decree 171/2016/ND-CP.
In principle, if a ship registers ownership rights in Vietnam, it must pay a registration fee in Vietnam. In case the ship does not register ownership in Vietnam, there is no need to pay registration fees in Vietnam.
Determining the cost of depreciation of fixed assets and determining costs unless determining taxable income is carried out in accordance with the provisions of Circular No. 45/2013/TT-BTC dated April 25, 2013, Circular No. 96/2015/TT-BTC dated June 22, 2015 of the Ministry of Finance.
V. OTHER
1. International Tax Information Report
Businesses need to report information on international taxes, including the tax rates paid in countries and the additional tax rates payable in Viet Nam, to ensure compliance with international agreements.
Comply with OECD regulations: Enterprises must comply with OECD regulations on global minimum taxes, including submitting international tax reports on time, and cooperate with national tax authorities during inspection, check.
Because global minimum taxes are coordinated between countries, businesses may need support from international tax experts to ensure accuracy in declaration. Tax consulting firms can help:
– Properly identify countries that pay taxes.
– Accurate calculation of the duties to be added.
– Resolve problems arising during tax inspections.
Declaring a global minimum tax in Vietnam is not a simple procedure and requires businesses to be carefully prepared in determining their tax obligations in each country. Businesses must clearly determine whether they are subject to global minimum tax application or not, and take steps to declare fully and accurately to ensure compliance with international and Vietnamese regulations.
2. Problems related to charter capital contribution of the enterprise
On November 4, 2024, the General Department of Taxation issued Official Dispatch No. 4975/TCT-KK responding to Official Dispatch No. 784/CTTTTH-TTKT3 dated June 5, 2024 of the Tax Department of Thua Thien Hue province on problems related to contributing capital charter of the enterprise as follows:
In case HFC Company Limited is a 100% foreign-invested enterprise established and operating under the Investment License issued for the first time on December 23, 1995, issued for the 4th time on September 24, 2001 (including regulations on legal capital is 2,266,639 USD, etc The company has contributed enough legal capital according to registration in USD and has recorded accounting books in VND according to the capital contribution progress of 32,637,619,248 VND. In 2008, in accordance with the 2005 Investment Law, the Company changed its Investment License to an Investment Certificate issued for the first time on July 22008 (including regulations on charter capital of 36.3 billion VND equivalent to 2,266,639 USD at the exchange rate at the time of issuance of the Investment Certificate and no longer regulations on legal capital), in principle, in case the Company has contributed enough capital in foreign currency of 2,266,639 USD before the issuance of the first Investment Certificate on July 2, 2008, the company has contributed enough capital.