What is the Circular 78 on handling erroneous invoices in Vietnam?

What is the Circular 78 on handling erroneous invoices in Vietnam?

Circular 78 on handling erroneous invoices refers to Circular 78/2021/TT-BTC, which provides guidance for implementing the Law on Tax Administration, Decree 123/2020/ND-CP regulating invoices and documents issued by the Minister of Finance.

The scope of Circular 78 on handling erroneous invoices, according to Article 1 of Circular 78/2021/TT-BTC, is as follows:

This Circular provides guidance on several aspects of invoices and documents as regulated by the Law on Tax Administration dated June 13, 2019, Decree 123/2020/ND-CP dated October 19, 2020, by the Government of Vietnam on invoices and documents (hereafter referred to as Decree 123/2020/ND-CP), including:

- Certain aspects of e-invoices, such as delegation of e-invoice creation; sample number codes, e-invoice codes; transition to e-invoices with tax authority codes; application of e-invoices in certain other cases; handling e-invoices, and summaries of e-invoice data sent to tax authorities with errors; e-invoices with tax authority codes generated from cash registers with e-data transmission to tax authorities; criteria for organizations providing e-invoice services to contract e-invoice services with tax authority codes and services for receiving, transmitting, storing invoice data, and other related services.

- Various aspects of paper invoices, including the name of invoice types, sample number codes of invoices, invoice codes, the name of invoice copies printed by the Tax Department, codes for samples of invoices such as stamps, tickets, and cards printed by the Tax Department.

- Use of receipts and documents.

- Guidance on transitional handling.

Thus, Circular 78 on handling erroneous invoices is Circular 78/2021/TT-BTC.

What is the Circular 78 on handling erroneous invoices in Vietnam? (Image from the Internet)

Which entities will apply Circular 78 on handling erroneous invoices in Vietnam?

Based on Article 2 of Circular 78/2021/TT-BTC as follows:

Applicable Subjects

The subjects applicable to the guidance in this Circular are organizations and individuals stipulated in Article 2 of Decree 123/2020/ND-CP.

Referring to Article 2 of Decree 123/2020/ND-CP as follows:

[1] Organizations and individuals selling goods and services, including:

- Enterprises established and operating under Vietnamese law; branches, representative offices of foreign enterprises operating in Vietnam;

- Cooperatives, cooperative unions;

- Business households, individuals, cooperative groups;

- Public service units selling goods and providing services;

- Organizations not being enterprises but engaging in business activities.

[2] Organizations and individuals purchasing goods and services.

[3] Tax, fee, and charge collection organizations.

[4] Taxpayers, fee payers, and charge payers.

[5] Organizations responsible for withholding personal income tax.

[6] Organizations receiving invoice and document printing; organizations providing self-printing software for documents; organizations providing e-invoice, and document services.

[7] Tax authorities, including the General Department of Taxation, Tax Departments, and Tax Branches (including area Tax Branches).

[8] Customs authorities, including the General Department of Customs, Customs Departments, Post-clearance Audit Departments, Customs Branches.

[9] Organizations and individuals related to the management and use of invoices and documents.

Thus, the entities from [1] to [9] are those that will apply Circular 78 on handling erroneous invoices.

How to handle e-invoices sent to tax authorities with errors in certain cases in Vietnam?

Based on Article 7 of Circular 78/2021/TT-BTC as follows:

- For e-invoices:

+ If an issued e-invoice has errors that need a tax authority's code reissuance or needs to be adjusted or replaced according to Article 19 of Decree 123/2020/ND-CP, the seller may use Form 04/SS-HDDT Download in Appendix IA issued with Decree 123/2020/ND-CP to notify of adjustments for each erroneous invoice or multiple e-invoices with errors and send the notice using Form 04/SS-HDDT Download to the tax authority at any time, but no later than the last day of the tax declaration period in which the adjusted e-invoice arises;

+ If the seller issues an invoice when receiving advance payments or during service provision as per Clause 2 Article 9 of Decree 123/2020/ND-CP and later cancels or ends the service, the seller cancels the issued e-invoice and notifies the tax authority using Form 04/SS-HDDT Download in Appendix IA issued with Decree 123/2020/ND-CP;

+ If an issued e-invoice has errors and has been handled by adjustment or replacement according to point b clause 2 Article 19 of Decree 123/2020/ND-CP, but further errors are discovered, subsequent handling will be consistent with the method applied in the initial error correction;

+ As per the notification period in Form 01/TB-RSDT Download Appendix IB issued with Decree 123/2020/ND-CP, the seller notifies the tax authority using Form 04/SS-HDDT Download in Appendix IA issued with Decree 123/2020/ND-CP about checking issued e-invoices with errors, clearly stating the basis for the check as notification Form 01/TB-RSDT Download from the tax authority (including notification number and date);

+ If e-invoices are issued without sample number code, invoice code, number with errors as per regulation, the seller only needs to adjust, not cancel or replace them;

+ Particularly for errors in the value on the invoice: increase (marked as positive), decrease (marked as negative) accurately according to the actual adjustment.

- For summaries of e-invoice data:

+ After the deadline for submitting the summary of e-invoice data to the tax authority, if there is missing e-invoice data in the submitted summary, the seller submits a supplemental summary of e-invoice data;

+ If the summary of e-invoice data sent to the tax authority has errors, the seller submits adjusted information for the declared data in the summary;

+ Adjusting invoices in the summary of e-invoice data as per regulation at point a.1 clause 3 Article 22 of Decree 123/2020/ND-CP, must complete the information: sample number code, invoice code, invoice number in column 14 "related invoice information" on Form 01/TH-HDDT issued with Decree 123/2020/ND-CP (except when the e-invoice does not need all the information of sample number code, invoice code, invoice number as per regulation in clause 14 Article 10 of Decree 123/2020/ND-CP).

- Additional tax declaration dossiers related to adjusted or replaced e-invoices (including canceled e-invoices) shall comply with the tax administration law.