The General Department of Taxation provides guidance on issuing replacement invoices for erroneous invoices when being coerced to stop using invoices.
If an Invoice Has Errors, Should It Be Adjusted or Replaced?
According to Point b, Clause 2, Article 19 of Decree 123/2020/ND-CP on handling erroneous invoices as follows:
Handling Erroneous Invoices
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2. In cases where electronic invoices with tax authority codes or electronic invoices without tax authority codes have been sent to the buyer but an error is detected by either the buyer or the seller, they shall be handled as follows:
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b) In case of errors such as: incorrect taxpayer identification number; incorrect amount on the invoice, incorrect tax rate, tax amount, or goods and services listed incorrectly in terms of specifications and quality, one of the following methods can be chosen to handle the electronic invoice:
b1) The seller issues an electronic invoice to adjust the erroneous invoice previously issued. In cases where the seller and buyer agree to draft a written agreement before issuing the corrective invoice for the erroneous invoice, they shall make a written agreement specifying the error, and then the seller shall issue an electronic invoice to adjust the erroneous invoice previously issued.
The electronic invoice that adjusts the previously issued erroneous invoice must contain the phrase “Adjustment for invoice form number... sign... number... date... month... year”.
b2) The seller issues a new electronic invoice to replace the erroneous electronic invoice, except where the seller and buyer agree to draft a written agreement before issuing the replacement invoice for the erroneous invoice, they shall make a written agreement specifying the error, and then the seller issues a new electronic invoice to replace the erroneous invoice previously issued.
The new electronic invoice replacing the previously issued erroneous invoice must contain the phrase “Replacement for invoice form number... sign... number... date... month... year”.
The seller signs the new electronic invoice either adjusting or replacing the previously issued erroneous invoice, then sends it to the buyer (for cases using electronic invoices without tax authority codes) or sends it to the tax authority for code issuance to be sent to the buyer (for cases using electronic invoices with tax authority codes).
Thus, when the seller issues an erroneous invoice with errors such as incorrect taxpayer identification number, incorrect amount, incorrect tax rate, incorrect tax amount, or errors in the listing of goods and services in terms of specifications and quality, one of the two methods—issuing an adjusted electronic invoice or issuing a replacement invoice—can be chosen.
General Department of Taxation guides on issuing replacement invoices for erroneous invoices when enforcement measures for stopping invoice usage are applied.
Is It Necessary to Issue Replacement Invoices for Erroneous Invoices When Subject to Tax Debt Enforcement?
This issue is guided similarly by the General Department of Taxation in Official Dispatch 575/TCT-QLN in 2023 as follows:
- According to the provisions at Point d, Clause 4, Article 34 of Decree 126/2020/ND-CP as follows:
Enforcement by Measures to Stop Invoice Usage
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4. Procedures for implementing measures to stop invoice usage
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d) In case enforcement measures are being applied to stop invoice usage, if the taxpayer requests to use invoices to have funds to pay workers' wages and cover costs ensuring continuous business operations, the tax authority will allow the taxpayer to use invoices on a case-by-case basis, provided that at least 18% of the revenue from the used invoices is paid immediately to the state budget.
According to Point b, Clause 2, Article 19 of Decree 123/2020/ND-CP as follows:
Handling Erroneous Invoices
...
2. In cases where electronic invoices with tax authority codes or electronic invoices without tax authority codes have been sent to the buyer but an error is detected by either the buyer or the seller, they shall be handled as follows:
...
b) In case of errors such as: incorrect taxpayer identification number; incorrect amount on the invoice, incorrect tax rate, tax amount, or goods and services listed incorrectly in terms of specifications and quality, one of the following methods can be chosen to handle the electronic invoice:
b1) The seller issues an electronic invoice to adjust the erroneous invoice previously issued. In cases where the seller and buyer agree to draft a written agreement before issuing the corrective invoice for the erroneous invoice, they shall make a written agreement specifying the error, and then the seller shall issue an electronic invoice to adjust the erroneous invoice previously issued.
The electronic invoice that adjusts the previously issued erroneous invoice must contain the phrase “Adjustment for invoice form number... sign... number... date... month... year”.
b2) The seller issues a new electronic invoice to replace the erroneous electronic invoice, except where the seller and buyer agree to draft a written agreement before issuing the replacement invoice for the erroneous invoice, they shall make a written agreement specifying the error, and then the seller issues a new electronic invoice to replace the erroneous invoice previously issued.
The new electronic invoice replacing the previously issued erroneous invoice must contain the phrase “Replacement for invoice form number... sign... number... date... month... year”.
The seller signs the new electronic invoice either adjusting or replacing the previously issued erroneous invoice, then sends it to the buyer (for cases using electronic invoices without tax authority codes) or sends it to the tax authority for code issuance to be sent to the buyer (for cases using electronic invoices with tax authority codes).
Thus, in case the taxpayer chooses to issue an adjusted or replacement invoice for the previously issued erroneous invoice, a new invoice must be issued.
In cases where enforcement measures are applied to stop invoice usage, the company is allowed to use electronic invoices on a case-by-case basis and must immediately pay at least 18% of the revenue from the used invoices to the state budget as stipulated at Point d, Clause 4, Article 34 of Decree 126/2020/ND-CP.
What Are the Procedures for Implementing Measures to Stop Invoice Usage?
The procedures for implementing measures to stop invoice usage according to Clause 4, Article 34 of Decree 126/2020/ND-CP are as follows:
(1) On the same day the enforcement decision is issued, the tax authority must post the enforcement decision and the notice to stop invoice usage on the tax authority's website or publish it on mass media within 24 hours from the time the decision is issued.
(2) During the period of implementing this enforcement measure, the tax authority will not accept dossier notifications for invoice issuance from organizations and individuals under enforcement, will not issue codes for electronic invoices with tax authority codes, will not issue invoices, and will not sell invoices to taxpayers under enforcement (except as provided at Point d, Clause 4, Article 34 of Decree 126/2020/ND-CP).
(3) The tax authority will issue a decision to terminate the implementation of this enforcement measure along with a notice to resume invoice usage according to Form No. 04-2/CC in Appendix III issued with Decree 126/2020/ND-CP. On the same day the decision to terminate implementation of the enforcement measure to stop invoice usage is issued, the tax authority must post it on the tax authority's website or publish it on mass media within 24 hours from the time the decision is issued.
(4) In case enforcement measures are being applied to stop invoice usage, if the taxpayer requests to use invoices to have funds to pay workers' wages and cover costs ensuring continuous business operations, the tax authority will allow the taxpayer to use invoices on a case-by-case basis, provided that at least 18% of the revenue from the used invoices is paid immediately to the state budget.
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