What are penalties for causing the loss, burning or damage of invoices in Vietnam already released or purchased from tax authorities even though they have not been issued yet?

1. What are penalties for causing the loss, burning or damage of invoices in Vietnam already released or purchased from tax authorities even though they have not been issued yet?

Pursuant to Article 26 of Decree 125/2020/ND-CP as amended by Article 1 of Decree 102/2021/ND-CP stipulating penalties for the act of causing the loss, burning or damage of invoices as follows:

1. Cautions shall be given as a form of penalty imposed for the following violations:

a) Causing the loss, burning or damage of issued invoices (except the replicas intended for clients) during use, or of invoices already used for tax declaration or payment purposes, even though documents or records evidencing the sale of goods or the provision of services exist and such violation is committed under mitigating circumstances;

b) Causing the loss, burning or damage of invoices with incorrect or deleted information though sellers issue other replacement invoices.

2. Fines ranging from VND 3,000,000 to VND 5,000,000 shall be imposed for the act of causing the loss, burning or damage of issued invoices (the replicas intended for clients) during use although sellers have already declared or paid taxes based on these invoices, or have had documents or records evidencing the sale of goods or the provision of services, and such violation is committed under mitigating circumstances.

If such loss, burning or damage takes place through the buyer's fault, both the seller and the buyer must keep a record of such incident.

3. Fines ranging from VND 4,000,000 to VND 8,000,000 shall be imposed for one of the following violations:

a) Causing the loss, burning or damage of invoices already released or purchased from tax authorities even though they have not been issued yet;

b) Causing the loss, burning or damage of issued invoices (the replicas intended for clients) during use although sellers have already declared or paid taxes, or have had documents or records evidencing the sale of goods or the provision of services.

If such loss, burning or damage takes place through the buyer's fault, both the seller and the buyer must keep a record of such incident.

4. Fines ranging from VND 5,000,000 to VND 10,000,000 shall be imposed for the act of causing the loss, burning and damage of issued invoices, or invoices already submitted for completion of tax declaration or payment procedures, or those are in use or storage, except the cases specified in clause 1, 2 and 3 of this Article.

5. In the cases of loss, burning or damage of invoices prescribed in clause 2 and point b of clause 3 of this Article which is caused through the third party’s fault, if the third party performs transactions with the seller, then the seller shall be sanctioned; if the third party performs transaction with the buyer, then the buyer shall be sanctioned.

The seller or the buyer and the third party must make a report on the loss, burning or damage of invoices.

Thus, the act of causing the loss, burning or damage of invoices that have been issued or purchased by tax authorities even though they have not been issued yet will be fined from VND 4,000,000 to VND 8,000,000 in Vietnam.

2. If externally ordered invoices not released yet but no longer used, should it be canceled in Vietnam? Is there penalty for failing to cancel in Vietnam?

Pursuant to Article 27 of Decree 125/2020/ND-CP stipulating penalties for violations against regulations on cancellation, destruction or elimination of invoices as follows:

1. Penalties in the form of cautions shall be imposed for the act of cancelling or destroying invoices from 1 to 5 days after expiry of the regulated time limit under mitigating circumstances.

2. Fines ranging from VND 2,000,000 to VND 4,000,000 shall be imposed for one of the following violations:

a) Cancelling invoices released but not issued, or invalidated invoices, in breach of regulations.

b) Failing to cancel invoices released but not issued yet, or invalidated invoices, or failing to cancel invoices purchased from tax authorities but expired;

c) Cancelling or destroying invoices from 1 to 10 working days after expiry of the regulated time limit, except the case prescribed in clause 1 of this Article.

3. Fines ranging from VND 4,000,000 to VND 8,000,000 shall be imposed for one of the following violations:

a) Cancelling or destroying invoices at least 11 working days after expiry of the regulated time limit;

b) Failing to cancel or destroy invoices in accordance with laws;

c) Failing to cancel e-invoices containing defects after being issued after expiry of the time limit for tax authorities’ issuing notification of these defects to sellers;

d) Failing to cancel externally ordered invoices not released yet but no longer used according to regulations;

dd) Cancelling or destroying invoices in breach of procedures or processes prescribed by laws;

e) Destroying invoices though these invoices are not classified as those subject to destruction under laws.

4. Remedies: Compelling the cancellation or destruction of invoices with respect to the acts specified in point b of clause 2, point b, c and d of clause 3 of this Article.

Thus, externally ordered invoices not released yet but no longer used must be destroyed according to the provisions of the law. The act of failing to cancel externally ordered invoices not released yet but no longer used as prescribed will be fined from VND 4,000,000 to VND 8,000,000 and forced cancellation of invoices for violations in Vietnam.

Best Regards!