Vietnam: Is a VAT invoice issued when exporting goods?

Vietnam: Is a VAT invoice issued when exporting goods?

Based on Article 4 of Decree 123/2020/ND-CP stipulating the principles of issuing, managing, and using invoices and records as follows:

Principles of Issuing, Managing, and Using Invoices and records

1. When selling goods or providing services, the seller must issue an invoice to the buyer (including cases where goods or services are used for promotion, advertisement, samples; goods, services used for donation, gifting, exchange, salary payment for employees and internal consumption (except for circulating goods internally to continue the production process); exporting goods under forms of loans, borrowing or returning goods) and must fully record the contents as prescribed in Article 10 of this Decree, in case of using electronic invoices, it must follow the standard data format of the tax authority as prescribed in Article 12 of this Decree.

2. When deducting personal income tax, collecting tax, fees, charges, the tax deduction organization, fee, charge collecting organization, tax collecting organization must issue a tax deduction record, tax collection receipt, fee, charge receipt for the individual whose income is taxed, taxpayer, fee, charge payer and must fully record the contents as prescribed in Article 32 of this Decree. In case of using electronic receipts, it must follow the standard data format of the tax authority. In case an individual authorizes tax finalization, no personal income tax deduction record is issued.

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According to Article 8 of Decree 123/2020/ND-CP defining types of invoices as follows:

Types of Invoices

Invoices stipulated in this Decree include the following types:

1. VAT invoice is an invoice for organizations declaring value-added tax by the deduction method, used for activities:

a) Selling goods, providing services domestically;

b) International transport activities;

c) Export into tax-free zones and cases deemed as export;

d) Export of goods, provision of services overseas.

2. Sales invoice is for organizations, individuals such as:

a) Organizations, individuals declaring, calculating value-added tax by the direct method used for activities:

- Selling goods, providing services domestically;

- International transport activities;

- Export into tax-free zones and cases deemed as export;

- Export of goods, provision of services overseas.

b) Organizations, individuals in tax-free zones when selling goods, providing services into the domestic market and when selling goods, providing services between organizations, individuals in tax-free zones, and exporting goods, providing services overseas, the invoice must clearly state “For organizations, individuals in tax-free zones.”

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Thus, based on the above regulations, a value-added tax invoice must be issued when exporting goods overseas.

Vietnam: Is a VAT invoice issued when exporting goods? (Image from Internet)

When is the time to issue a VAT invoice in Vietnam?

Based on Clauses 1, 2, and 3 of Article 9 Decree 123/2020/ND-CP regulating the time of issuing invoices as follows:

- The time of issuing a value-added tax invoice for the sale of goods is at the time of transfer of ownership or right to use the goods to the buyer, regardless of whether the money has been collected or not.

- The time of issuing a value-added tax invoice for service provision is when the service provision is completed, regardless of whether the money has been collected or not. In cases where the service provider collects money before or during the service provision, the time of issuing the invoice is the time of money collection.

- In cases of multiple deliveries or handover of each item, service stage, each delivery, or handover must result in an invoice being issued for the corresponding quantity and value of goods, services delivered.

Additionally, there are some specific cases of invoice issuance regulated in Clause 4 of Article 9 Decree 123/2020/ND-CP

Is recording the buyer's TIN on a VAT invoice mandatory?

Based on Clause 5 of Article 10 Decree 123/2020/ND-CP defined as follows:

Contents of the Invoice

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5. Name, address, and TIN of the buyer

a) In cases where the buyer is a business establishment with a TIN, the name, address, and TIN of the buyer shown on the invoice must be fully recorded as per the business registration certificate, branch operation registration certificate, household business registration certificate, taxpayer registration certificate, tax code notification, investment registration certificate, cooperative registration certificate.

In cases where the name, address of the buyer is too long, on the invoice, the seller may abbreviate some common nouns like "Phường" to "P"; "Quận" to "Q", "Thành phố" to "TP", "Việt Nam" to "VN" or "Cổ phần" to "CP", "Trách nhiệm Hữu hạn" to "TNHH", "khu công nghiệp" to "KCN", "sản xuất" to "SX", "Chi nhánh" to "CN"… but must ensure to fully show the house number, street name, ward, district, city, accurately identifying the name, address of the business and comply with the business registration, taxpayer registration of the business.

b) In cases where the buyer does not have a TIN, the invoice does not need to show the buyer's TIN. Some specific cases of selling goods, providing services to consumers being individuals as regulated in Clause 14 of this Article do not need to show the buyer's name, address on the invoice. In cases of selling goods, providing services to foreign customers arriving in Vietnam, the buyer's address information may be replaced by information on passport numbers or immigration records and the nationality of the foreign customers.

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Thus, based on the above regulations, it is mandatory to record the buyer's TIN on the value-added tax invoice in cases where the buyer has a TIN.

In cases where the buyer does not have a TIN, the invoice does not need to show the buyer's TIN.