What is the guidance on declaring the Form for distribution of VAT obligations for hydropower production in Vietnam?

Which is the Form for distribution of VAT obligations for hydropower production in Vietnam?

The Appendix Form for distribution of VAT obligations for hydropower production (Form 01-2/GTGT) is stipulated in Section II, Appendix II issued together with Circular 80/2021/TT-BTC.

DOWNLOAD >>> Form 01-2/GTGT

What is the guidance on declaring the Form for distribution of VAT obligations for hydropower production in Vietnam?

Below is guidance on how to declare the Appendix Form for distribution of VAT obligations for hydropower production according to Form 01-2/GTGT issued with Circular 80/2021/TT-BTC as follows:

- Column Indicator [07], [08]: Declare the names of districts and provinces where the hydropower plant office is located and where the hydropower plant is situated. In case a plant spans multiple districts under the management of the same tax authority, select one district in which the plant is located to declare under this indicator.

- Column Indicator [09]: Declare the tax authority managing the area receiving the distribution.

- Column Indicator [10]: Taxpayers self-determine the VAT obligations by the hydropower plant to be declared in indicators [10a], [10b], leaving the remaining boxes blank.

- Column Indicator [11]: Declare the distribution rate for each province based on the investment value of the hydropower plant in each province.

- Column Indicator [12]: The tax amount obligations by each province is determined by multiplying the tax amount obligations by the hydropower plant by the distribution rate for each province.

What is the guidance on declaring the Form for distribution of VAT obligations for hydropower production in Vietnam? (Image from the Internet)

How is the VAT obligations distribution method for each province with multi-province hydropower plants in Vietnam?

The method of allocating VAT obligations for each province where a hydropower plant spans multiple provinces is regulated in point đ, clause 2, Article 13 of Circular 80/2021/TT-BTC as follows:

Tax declaration, calculation, distribution, and payment of value-added tax

...

2. distribution method:

...

d) Allocate the VAT obligations to the province where the dependent unit, business location is a production facility:

d.1) The VAT obligations to the province where the production facility is located is calculated by multiplying the revenue before VAT by 2% (for goods subject to 10% VAT rate) or 1% (for goods subject to 5% VAT rate), provided that the total VAT obligations to the provinces where the production facility is located does not exceed the VAT amount obligations by the taxpayer at the main office. If the production facility transfers finished or semi-finished products to another internal unit for sale, the revenue of the produced products is determined based on the production cost of the product.

d.2) If the taxpayer calculates to declare and pay according to the percentage specified in point d.1 of this clause, and the total VAT obligations to the provinces where the production facility is located exceeds the VAT obligations by the taxpayer at the main office, the taxpayer shall allocate the tax obligations to the provinces where the production facility is located using the following formula: The VAT obligations to each province where the production facility is located is equal to the VAT obligations by the taxpayer at the main office multiplied by the percentage (%) of revenue before VAT of the products produced at each province over the total revenue before VAT of the products produced by the taxpayer.

d.3) The revenue used to determine the distribution rate according to the regulations at points d.1 and d.2 of this clause is the actual revenue arising during the tax period. If there is a supplementary declaration that changes the actual revenue, the taxpayer must determine and reallocate the tax obligations for each erroneous tax period to determine the VAT discrepancy yet to be allocated or over-allocated to each locality.

đ) Allocate the VAT obligations to each province where the hydropower plant spans multiple provinces:

The VAT obligations at each province where the hydropower plant is located within the administrative boundary is calculated by multiplying the VAT obligations by the hydropower plant by the percentage (%) of the investment value of the part of the hydropower plant located within the administrative boundary of each province over the total investment value of the hydropower plant.

Based on the regulation of the VAT distribution method obligations for each province where the hydropower plant spans multiple provinces as follows: