What is the guidance on VAT refund for the provision of construction and installation services to customers who are export processing enterprises in Vietnam?
- What is the guidance on VAT refund for the provision of construction and installation services to customers who are export processing enterprises in Vietnam?
- What conditions and procedures must be met for exported goods and services to receive tax credit or input VAT refund?
- What are the conditions and procedures for VAT refund in Vietnam?
What is the guidance on VAT refund for the provision of construction and installation services to customers who are export processing enterprises in Vietnam?
Pursuant to the provisions of Clause 4, Article 18 of Circular No. 219/2013/TT-BTC (amended by point b, Clause 2, Article 1 of Circular No. 26/2015/TT-BTC and Article 2 of Circular No. 25/2018/TT-BTC) stipulating cases of VAT refund in Vietnam as follows:
Cases of VAT refund in Vietnam
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4. Refund of tax on exported goods/services
a) In a month (in case of monthly declaration) or quarter (in case of quarterly declaration), if the input VAT on exported goods/services (including goods that are imported and subsequently exported to non-tariff areas and the goods that are imported and subsequently exported to other countries) of a business establishment remains at least 300 million dong after being offset against, it shall be refunded by month or quarter. If such input VAT is less than 300 million dong, it shall be offset against in the next month/quarter.
In a month/quarter, if a business establishment has both exported goods/services and goods/services sold domestically, input VAT on purchases used for manufacturing of exported goods/services shall be separately recorded. Otherwise, input VAT shall be determined according to the ratio of revenue from exported goods/services to total revenue from goods/services accrued from the tax period succeeding the period in which tax is refunded to the current period in which tax refund is claimed.
If the input VAT on exported goods and services (including the input VAT separately recorded and the input VAT determined through the aforementioned ratio) remains at least 300 million dong after having been deducted from VAT on goods and services sold domestically, the business establishment shall receive a refund of VAT on exported goods and services. The refunded amount of VAT on exported goods and services shall not exceed the revenue from such exported goods and services multiplied by (x) 10%.
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In Official Dispatch No. 49059/CTHN-TTHT in 2022, the Hanoi Tax Department guides as follows:
Pursuant to the above provisions, in case Ruiyang Electromechanical Works Co., Ltd. has activities of providing construction and installation services to customers who are export processing enterprises (export services), whose input VAT has not been If you deduct VND 300 million or more in a month/quarter, you will be entitled to a monthly/quarterly value-added tax refund as prescribed in Article 2 of Circular No. 25/2018/TT-BTC dated March 16, 2018 of the Ministry of Finance.
What is the guidance on VAT refund for the provision of construction and installation services to customers who are export processing enterprises in Vietnam? (Image from the Internet)
What conditions and procedures must be met for exported goods and services to receive tax credit or input VAT refund?
Pursuant to Article 16 of Circular No. 219/2013/TT-BTC (amended by Clause 11 Article 1 of Circular No. 26/2015/TT-BTC and Clause 7 Article 3 of Circular No. 119/2014/TT-BTC) stipulating the conditions for deduction and refund of input tax on exported goods and services are as follows:
Conditions for deducting and refunding input VATon exported goods and services
VAT on exported goods and services (except for the cases in Article 17 of this Circular) shall only be deducted and refunded when the documents mentioned in Clause 2 Article 9 and Clause 1 Article 15 of this Circular are presented. In particular:
1. The contract to sell, process goods, or provide services for a foreign entity. If the exported is entrusted, the compulsory documents are the entrustment contract and the note of entrustment contract finalization or a debt comparison note between the entrusting party and the entrusted party, specifying the quantity, categories, value of exported goods, the export contract number; the date and amount of money on the bank transfer receipt for the payment between the foreign party and the entrusted party, the date and amount of money on the receipt for payment to the entrusting party by the entrusted party, number and date of the customs declaration of exported goods made by the entrusted party.
2. If customs procedure has been completed in accordance with instructions of the Ministry of Finance: the customs declaration.
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3. Payment for exported goods and services must be made by bank transfer.
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4. Commercial invoice. The day to determine revenue from export to calculate tax is the day on which customs procedure completion is confirmed on the customs declaration.
In Official Dispatch No. 49059/CTHN-TTHT in 2022, the Hanoi Tax Department guides as follows:
Based on the above provisions, exported goods and services (except for the cases guided in Article 17 of Circular No. 219/2013/TT-BTC dated December 31, 2013 of the Ministry of Finance) are eligible for tax credit or refund. Input value-added tax must meet the conditions and procedures as prescribed in Article 16 of Circular No. 219/2013/TT-BTC dated December 31, 2013 of the Ministry of Finance.
The content related to the customs declaration is not within the competence of the tax authorities to reply, and the Company is requested to contact the customs authority for specific instructions.
What are the conditions and procedures for VAT refund in Vietnam?
Pursuant to Article 19 of Circular No. 219/2013/TT-BTC stipulating the conditions and procedures for VAT refund as follows:
Conditions and procedures for VAT refund in Vietnam
1. To be eligible for tax refund according to Points 1, 2, 3, 4, 5 Article 18 of this Circular, the taxpayer must pay tax using credit-invoice method, be issued with a Certificate of Business registration or investment license or practice certificate, or a decision on establishment issued by a competent authority, have a legal seal, keep accounting records in accordance with accounting laws, and have deposit accounts at banks according to the taxpayer’s TIN.
2. Input VAT that has been claimed on the VAT declaration must not be aggregated with the deductible tax of the next month.
3. VAT shall be refunded in accordance with the procedures in the Law on Tax administration and its guiding documents.
Thus, the conditions and procedures for VAT refund are specified as above.
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