What are cases of compulsory issuance of invoices in Vietnam?

What are cases of compulsory issuance of invoices in Vietnam?

According to Article 4, Clause 1 of Decree 123/2020/ND-CP, the content is as follows:

Principles for issuance, management, and use of invoices and records

1. When selling goods or providing services, the seller must issue an invoice to give to the buyer (including cases where goods or services are used for promotion, advertising, as samples; goods or services given, gifted, exchanged, used for salary payment, or internal consumption (except for internally rotated goods to continue the production process); goods exported as loans, borrowing, or return of goods) and must fully record the content as prescribed in Article 10 of this Decree. In the case of using electronic invoices, they must comply with the standard data format of the tax authority as prescribed in Article 12 of this Decree.

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Furthermore, in Clause 9, Article 10 of Decree 123/2020/ND-CP, it is stipulated that the digital signing time on an electronic invoice is when the seller or buyer uses a digital signature on the electronic invoice displayed in the format of the calendar year: day, month, year. If the digital signing time on an already issued electronic invoice differs from the invoice issuance time, the tax declaration time is the invoice issuance time.

Thus, the seller must issue an invoice to the buyer when selling goods or providing services, regardless of the value of goods or services, including in the following cases:

- Goods or services used for promotion, advertising, as samples

- Goods or services given, gifted, exchanged, used for salary payment, or internal consumption (except for internally rotated goods to continue the production process)

- Goods exported in forms of loans, borrowing, or return of goods.

Invoices with different issuance and digital signing times are allowed. In cases where the time of digital signing differs from the invoice issuance time, tax declaration must be based on the invoice issuance time.

When is the timing for issuing VAT invoices in Vietnam?

According to Article 9 of Decree 123/2020/ND-CP, the timing for issuing invoices is specifically regulated as follows:

* Invoicing time when selling goods

The timing for issuing invoices for selling goods (including selling state property, confiscated property, national reserve goods) is at the time of transferring the ownership or the right to use goods to the buyer, regardless of whether payment has been received.

* Invoicing time when providing services

- The timing for issuing invoices for providing services is at the time of completing the service provision, regardless of whether payment has been received.

- If the service provider receives payment before or during the provision of the service, the timing for issuing the invoice is the time of payment receipt (excluding cases of receiving deposits or advances to ensure the execution of service contracts such as accounting, auditing, financial consulting, tax consulting; appraisal; supervision consulting; surveying, technical design; setting up construction investment projects).

Note: In cases of multiple deliveries or partial handover of service stages, an invoice must be issued for each delivery or handover corresponding to the quantity and value of goods or services delivered.

* Invoicing time in specific cases

(1) For cases of providing services in large quantities, frequently occurring, requiring time to reconcile data between the service provider and customers, partners.

The time for issuing invoices is the time of completing data reconciliation between the parties but no later than the 7th of the following month from the month of service provision or no later than 7 days from the date of ending the customary period.

The customary period used as a basis for calculating the quantity of goods, services provided is based on the agreement between the goods seller, service provider, and the customer.

(2) For telecommunications services (including value-added telecommunications services), information technology services (including intermediary payment services using telecommunications, information technology platforms) data connection reconciliation between service business entities is required.

The time for issuing invoices is the time of completing data reconciliation on service fees according to the economic contract between service business entities but no later than 2 months from the month of generating service connection fees.

For providing telecommunications services (including value-added telecommunications services) through the sale of prepaid cards, network registration fees when customers register to use the service without requesting VAT invoice issuance or do not provide a name, address, tax code, then at the end of each day or periodically in the month, the service business entity issues a collective VAT invoice recording the total revenue generated for each service where the buyer does not take an invoice or does not provide a name, address, tax code.

(3) For construction, installation activities, the time for issuing invoices is at the time of acceptance and handover of the works, work or construction volume completed, regardless of whether payment has been received.

(4) For real estate business organizations, infrastructure construction or housing construction for sale or transfer, the time for issuing invoices is specified distinctively for each case as follows:

- Not yet transferred ownership or usage rights: Payment is collected according to the project's progress or payment progress in the contract, the time for issuing invoices is the day of payment or as agreed in the payment terms of the contract.

- Ownership or usage rights have been transferred: The time for issuing invoices is the time of ownership or usage rights transfer to the buyer, regardless of whether payment has been received.

(5) For businesses engaging in air transport services exported via website and e-commerce systems:

The time for issuing invoices is in accordance with international practice, and must be no later than 5 consecutive days from the issuance date of transport service records on the website and e-commerce system.

(6) For exploration, exploitation, and processing of crude oil activities:

- The time for issuing invoices for selling crude oil, condensate, and products processed from crude oil (including activities of product off-take under the Government of Vietnam's commitment) is when the buyer and seller determine the official selling price, regardless of whether payment has been received.

- For selling natural gas, associated gas, coal gas transferred via a gas pipeline to the buyer:

The time for issuing invoices is the time the buyer and seller determine the monthly delivered gas volume but no later than 7 consecutive days from the day the seller sends a notice of the monthly delivered gas volume.

- For agreements under the Government of Vietnam's guarantee and commitment that specify otherwise regarding the time for issuing invoices, follow the regulations in the Government of Vietnam's guarantee and commitment.

(7) Retail trading establishments, food and beverage services operating according to a store system directly selling to consumers, but the entire business operation accounting is done at the headquarters (headquarters directly signing purchase, sale contracts, issuing payment receipts for customers, with payment receipt data stored in the system and customers not needing electronic invoices):

At the end of the day, the business premises based on payment receipt information to collectively issue electronic invoices for goods sales, food, and beverage services provided during the day.

If customers request an electronic invoice issuance, the business establishment issues an electronic invoice to deliver to the customer.

(8) For electricity sales activities of power generation companies on the electricity market, the time for electronic invoice issuance is based on the time of reconciliation of payment data between the electricity system and market operator with the power generation and electricity purchasing units according to the Ministry of Industry and Trade's regulations or the electricity sales contracts approved by the Ministry of Industry and Trade.

The latest time for issuing the invoice is the last day of the tax declaration and payment deadline for the month in which the tax obligation arises as per tax law.

However, for electricity sales activities by power generation companies committed under the Government of Vietnam about payment times, the electronic invoice issuance time is based on the Government of Vietnam's guarantee, guidance and approval by the Ministry of Industry and Trade and the electricity sales contract signed between the electricity buyer and seller.

(9) The time of electronic invoice issuance for fuel sales at retail stations to customers is the time when selling fuel concludes at each fuel sale.

The seller must ensure full storage of electronic invoices for fuel sales to non-business individuals, business individuals and ensure they can be retrieved when requested by the competent authority.

(10) For providing air transport services, insurance services through agencies, the time for issuing invoices is at the time of completing data reconciliation between parties, but no later than the 10th of the following month from the month the service commenced.

(11) For providing banking services, securities, insurance, electronic wallet transfer services, cessation, and re-connection of the power distribution unit for non-business (or business) individuals who do not need an invoice at the end of the day or month, units issue a total invoice based on detailed transaction information generated in the day or month in the unit's data management system.

The service provider is responsible for the accuracy of transaction information content and for providing detailed service summary tables when requested by competent authorities.

If customers request an invoice for each transaction, the service provider must issue an invoice for the customer.

(12) Passenger transportation businesses using software for fare calculation in accordance with the law will issue invoices as follows:

- At the end of the trip, businesses, transportation cooperatives using software for fare calculation must send trip information to the customer and to the tax authority in the data format of the tax authority.

The information includes the name of the transport enterprise, vehicle registration number, trip distance (in kilometers), and total fare passengers must pay.

- If customers take an electronic invoice, they must update or send full information (name, address, tax identification number) into the software or provide to the service provider.

Based on customer-submitted or updated information, businesses, transportation cooperatives using fare calculation software will issue a trip invoice to the customer and simultaneously send invoice data to the tax authority.

(13) For medical examination and treatment service businesses using medical management and hospital fee software, each medical treatment transaction and service testing, consulting, imaging (with payment receipt or hospital fees) stored in the information technology system:

- If customers (patients) do not need an invoice, at the end of the day, the medical facility shall base on consultation, medical treatment information and payment receipt to collectively issue an electronic invoice for medical services performed during the day.

- If customers request electronic invoice issuance, the medical facility issues an electronic invoice for the customer.

(14) For toll collection activities under electronic non-stop toll payment systems, the day of electronic invoice issuance is the day the vehicle passes the toll station.

If customers using electronic non-stop toll systems have one or more vehicles subscribing to the service multiple times in a month, the service provider may issue electronic invoices periodically, with the latest issuance date being the last day of the month services generate fees.

The invoice content lists in detail each vehicle pass through tolls, including the time vehicles cross stations, road use fee for each vehicle pass.

How many types of invoices are there in Vietnam?

Pursuant to Article 8 of Decree 123/2020/ND-CP, the following types of invoices exist:

(1) Value-Added Tax Invoice

A Value-Added Tax Invoice is for organizations that declare VAT using the deduction method, used in activities like:

- Selling goods or providing services domestically;

- International transportation activities;

- Exporting to non-tariff zones and cases treated as exports;

- Exporting goods or providing services overseas.

(2) Sales Invoice

A Sales Invoice is for organizations, individuals as follows:

- Organizations or individuals declare, calculate VAT using the direct method for activities:

+ Selling goods or providing services domestically;

+ International transportation activities;

+ Exporting to non-tariff zones and cases treated as exports;

+ Exporting goods or services overseas.

- Organizations or individuals in the non-tariff zone selling goods or providing services to the domestic market and when trading goods or supplying services among organizations, individuals in the non-tariff zone or exporting goods, providing services overseas, the invoice must state "For organizations, individuals in the non-tariff zone."

(3) Electronic Public Asset Sales Invoice

The Electronic Public Asset Sales Invoice is used when selling the following assets:

- Public assets at agencies, organizations, units (including state-owned houses);

- Infrastructure assets;

- Public assets authorized for enterprises to manage not calculated as state capital in enterprises;

- Project assets using state budget;

- Assets established as state-owned;

- Public assets repossessed by decision of competent authorities;

- Materials recovered from public asset handling.

(4) Electronic National Reserve Goods Sales Invoice

The Electronic National Reserve Goods Sales Invoice is used when agencies, units under the state reserve system sell national reserve goods as per the law.

(5) Other types of invoices include:

- Stamps, tickets, cards with forms and content regulated in this Decree;

- Transport fee receipts for air transport; international transport service invoices; banking service fee receipts except for cases stipulated at point a of this clause with forms and internationally standard-compliant content as per relevant laws.

(6) Documents printed, issued, used, and managed like:

- Invoices include internal transportation manifest records

- Warehouse release slips for goods sent on consignment sales.