Selling Fresh Seafood with Basic Processing to Household Businesses: What Amount of Value-Added Tax Invoice Should Be Issued?
How much value-added tax invoice should be issued for the sale of unprocessed fresh seafood to business households?
According to the provisions of Clause 5, Article 5 of Circular 219/2013/TT-BTC which records cases where declaration and calculation of value-added tax (VAT) are not required as follows:
Cases where declaration and calculation of VAT are not required
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5. Enterprises and cooperatives paying VAT by the credit method selling agricultural, husbandry, aquatic, and seafood products that are unprocessed or only through normal preliminary processing to enterprises and cooperatives in the commercial trade stage do not have to declare, calculate, and pay VAT. On the VAT invoice, record the selling price as the non-VAT price, leave the tax rate and VAT lines blank, and cross them out.
In cases where enterprises and cooperatives paying VAT by the credit method sell agricultural, husbandry, aquatic, and seafood products that are unprocessed or only through normal preliminary processing to other entities such as business households, individuals, and other organizations, they must declare, calculate, and pay VAT at the rate of 5% as guided in Clause 5, Article 10 of this Circular.
Business households, individuals, enterprises, cooperatives, and other economic organizations paying VAT by the direct method on added value when selling agricultural, husbandry, and farmed or captured aquatic products that are unprocessed or only through normal preliminary processing in the commercial trade stage must declare, calculate, and pay VAT at a rate of 1% on revenue.
In cases where enterprises paying VAT by the credit method sell fresh seafood to business households, they must declare, calculate, and pay VAT at the rate of 5%.
How much value-added tax invoice should be issued for the sale of normally preliminary processed fresh seafood to business households?
In which cases are organizations and individuals in business not required to declare and calculate VAT?
According to the provisions of Article 5 of Circular 219/2013/TT-BTC, with some provisions supplemented by Clause 1, Article 3 of Circular 119/2014/TT-BTC and Article 1 of Circular 193/2015/TT-BTC regarding cases where declaration and calculation of VAT are not required:
First, Organizations and individuals receiving monetary compensation (including compensation for land and assets on land when land is recovered following decisions of competent state agencies), bonuses, support money, emissions trading rights, and other financial revenues.
Business establishments receiving monetary compensation, bonuses, support money, emissions trading rights, and other financial revenues must issue receipts following regulations. For business establishments paying money, they must prepare payment vouchers based on the payment purposes.
If compensation is made with goods or services, the compensating establishment must issue invoices and declare, calculate, and pay VAT as for the sale of goods or services; the compensated establishment declares and deducts according to regulations.
In cases where business establishments receive money from organizations or individuals to perform services for organizations or individuals, such as repairs, warranties, promotions, or advertisements, they must declare and pay VAT according to regulations.
Second, Organizations and individuals producing or doing business in Vietnam purchasing services from foreign organizations that do not have permanent establishments in Vietnam or from foreign individuals who are non-residents in Vietnam, including cases of repairing transport vehicles, machinery, and equipment (including materials and spare parts); advertising and marketing; investment and trade promotion; brokerage for selling goods and providing services abroad; training; sharing international postal and telecommunications service charges between Vietnam and foreign countries, which are performed outside Vietnam, and leasing transmission lines and satellite bandwidth from foreign countries following the law.
Third, Organizations and individuals not engaged in business, who are not VAT payers, selling assets.
Fourth, Organizations and individuals transferring investment projects to produce and trade goods and services subject to VAT to enterprises and cooperatives.
Fifth, Enterprises and cooperatives paying VAT by the credit method selling agricultural, husbandry, aquatic, and seafood products that are unprocessed or only through normal preliminary processing to enterprises and cooperatives in the commercial trade stage do not have to declare, calculate, and pay VAT. On the VAT invoice, record the selling price as the non-VAT price, leave the tax rate and VAT lines blank, and cross them out.
In cases where enterprises and cooperatives paying VAT by the credit method sell agricultural, husbandry, aquatic, and seafood products that are unprocessed or only through normal preliminary processing to other entities such as business households, individuals, and other organizations, they must declare, calculate, and pay VAT at the rate of 5% as guided in Clause 5, Article 10 of this Circular.
Business households, individuals, enterprises, cooperatives, and other economic organizations paying VAT by the direct method on added value when selling agricultural, husbandry, and farmed or captured aquatic products that are unprocessed or only through normal preliminary processing in the commercial trade stage must declare, calculate, and pay VAT at a rate of 1% on revenue.
Sixth, Fixed assets in use, depreciated according to accounting book values, transferred between business establishments and 100%-owned subsidiaries or between 100%-owned subsidiaries for production and business activities of VAT-subject goods and services are not required to issue invoices and declare, calculate, and pay VAT. The business establishment transferring fixed assets must have a Decision or a Transfer Order accompanying the asset origin dossier.
In cases where fixed assets are revalued for transfer or transferred to establishments producing VAT-exempt goods and services, they must issue VAT invoices, declare, and pay VAT according to regulations.
Seventh, Other cases include:
+ Contributing assets to form enterprises. Assets contributed to enterprises must have: a minutes of capital contribution for production and business, joint venture, collaboration contract; valuation minutes of the Capital Contribution Receiving Council of the contributing parties (or valuation documents of legally authorized valuation organizations), accompanied by the asset origin dossier.
+ Transferring assets between dependent accounting units within enterprises; transferring assets when dividing, separating, merging, consolidating, converting enterprise types. Assets transferred between dependent accounting units within business establishments; assets transferred when dividing, separating, merging, consolidating, converting enterprise types must have a Transfer Order, accompanied by the asset origin dossier, and do not have to issue invoices.
+ Recovering from the third party in insurance activities.
+ Receipts on behalf of others not related to the sale of goods and services by business establishments.
+ Revenue from goods and services sold by agents and commission earnings from agency activities sold at the exact prices fixed by the principal, including services: postal, telecommunications, lottery ticket sales, airline tickets, automobiles, train tickets, ships; international freight forwarding agents; agents for aviation and maritime services subject to 0% VAT rate; insurance agent sales.
+ Revenue from goods and services and commission earnings from agency activities of non-VAT-subject goods and services.
How are value-added tax invoices regulated?
According to Article 14 of the Law on Value-Added Tax 2008 regarding invoices and documents when applying VAT as follows:
The sale of goods and services must have invoices and documents following the law and the following provisions:
- Business establishments paying VAT by the credit method use VAT invoices; invoices must be filled out completely and accurately, including additional charges and fees (if any).
- Business establishments paying VAT by the direct method on added value use sales invoices.
Additionally, for stamps and tickets as pre-printed payment documents, the payment prices of those stamps and tickets already include VAT.
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