What is the explanation form for the acts of using illegal invoices of Vietnam?

What is the explanation form for the acts of using illegal invoices of Vietnam?

Based on Clause 1, Article 4 of Decree 125/2020/ND-CP, the act of using illegal invoices is defined as the use of invoices under the following circumstances:

- Fake invoices.

- Invoices that are not yet valid or have expired;

- Invoices suspended from use during the period of enforcement by means of invoice suspension, except when their use is permitted as per a notice from the tax authority;

- Electronic invoices not registered for use with the tax authority;

- Electronic invoices without codes from the tax authority in cases of using electronic invoices with a tax authority code;

- Invoices for goods or services purchased with the issuance date on the invoice occurring after the tax authority has determined that the seller is not operational at the address registered with the competent state authority;

- Invoices for goods or services purchased with the issuance date on the invoice occurring before the determination that the invoice issuer is not operational at the address registered with the competent state authority or lacking a tax authority notice regarding the invoice issuer not operating at the registered business address, but the tax authority, police, or other competent agencies have concluded that the invoice is not legitimate.

The official dispatch explaining the acts of using illegal invoices is a document that businesses send to tax authorities upon request or when businesses themselves discover that they have used invalid invoices, false invoices, or types of invoices that violate legal regulations on invoices.

Currently, the law does not provide specific regulations for the format of the official dispatch explaining the acts of using illegal invoices. Businesses can refer to the following template:

Template of Official Dispatch Explaining the acts of using illegal invoices Download

What is the explanation form for the acts of using illegal invoices of Vietnam? (Image from the Internet)

How much is the fine for using illegal invoices in Vietnam?

According to Article 28 of Decree 125/2020/ND-CP, the penalties for acts involving the acts of using illegal invoices or the unauthorized use of invoices are as follows:

Penalties for Acts Involving the acts of using illegal invoices or Unauthorized Use of Invoices

1. A fine ranging from 20,000,000 VND to 50,000,000 VND for acts of using illegal invoices, unauthorized use of invoices as stipulated in Article 4 of this Decree, except as provided in point đ, clause 1, Article 16, and point d, clause 1, Article 17 of this Decree.

2. Remedial measure: Mandatory cancellation of used invoices.

Pursuant to Clause 4, Article 7 of Decree 125/2020/ND-CP regarding the form of penalties, remedial measures, and principles for applying fines for administrative violations in tax and invoices as follows:

Form of Penalties, Remedial Measures, and Principles for Applying Fines in Administrative Violations in Tax and Invoices

[...]

4. Principles for applying fines

a) The fines stipulated in Articles 10, 11, 12, 13, 14, 15, clauses 1, 2 of Article 19, and Chapter III of this Decree are the fines applicable to organizations.

For taxpayers who are households or business households, fine levels are applied similar to individuals.

b) When determining the fine level for taxpayers with both aggravating and mitigating circumstances, the aggravating circumstances are offset by the mitigating circumstances according to the principle that one mitigating circumstance offsets one aggravating circumstance.

[...]

According to the above regulations, the specific penalties for acts of using illegal invoices are:

- For violating organizations: A fine ranging from 20,000,000 VND to 50,000,000 VND.

- For violating individuals: A fine ranging from 10,000,000 VND to 25,000,000 VND.

*Note: The above fines are not applicable in the following cases:

- Using illegal invoices for entering the value of purchased goods and services, resulting in a reduced tax liability or an increased amount of refundable, exempted, or reduced tax. However, during a tax audit or inspection, if the buyer can prove that the violation of using illegal invoices lies with the seller, and the buyer has accurately accounted for the invoices as per regulations.

- Using illegal invoices to declare tax that results in a reduced payable tax amount or increases the refundable, exempted, or reduced tax amount.

What is the deadline for submitting the quarterly invoice usage report in Vietnam?

According to Article 29 of Decree 123/2020/ND-CP regulating the reporting on the usage of printed invoices purchased from the tax authority and the list of invoices used during the period as follows:

Report on Invoice Usage of Printed Invoices Purchased from the Tax Authority and the List of Invoices Used During the Period

1. Quarterly, enterprises, economic organizations, households, and individual businesses purchasing invoices from the tax authority are responsible for submitting a report on the invoice usage and a list of used invoices during the period to the direct managing tax authority.

The report on invoice usage is submitted quarterly no later than the last day of the first month of the following quarter after the quarter in which the invoice usage occurs, using Form BC26/HDG Annex IA promulgated together with this Decree.

If no invoice was used during the period, businesses, economic organizations, households, and individual businesses submit a report on invoice usage recording the number of invoices used as zero (= 0), with no need to send a list of invoices used during the period. If the previous period has used up invoices and reported the invoice usage for the previous period with no balance (0), and no invoices are purchased or used during the period, enterprises, economic organizations, households, and individual businesses are not required to report invoice usage.

2. Enterprises, economic organizations, households, and individual businesses selling goods or services must submit a report on invoice usage and a list of invoices used during the period when undergoing division, separation, merger, dissolution, bankruptcy, ownership transformation; assignment, sale, contracting, or leasing of a state enterprise along with the deadline for submitting final tax declaration documents.

3. If businesses, economic organizations, households, or individual businesses change their business location to an area different from the area under the direct management of the tax authority, they must submit a report on invoice usage and a list of invoices used during the period to the tax authority at the departing location.

Therefore, the deadline for submitting the quarterly invoice usage report is no later than the last day of the first month of the following quarter after the quarter in which the invoice usage occurs.