Does an individual business household that purchases goods with the applicable form as flat-rate tax need to get an input invoice in Vietnam?
Does an individual business household that purchases goods with the applicable form as flat-rate tax need to get an input invoice in Vietnam? Can fixed tax payers have their company declare and pay taxes on their behalf with a commercial discount in Vietnam? What are deadlines for submission of tax declaration dossiers for fixed tax payers in Vietnam?
Hello Lawyers. In 2021, I established household business B to produce garments and pay taxes according to the flat-rate tax method. In 2022, my business will operate more stably after its establishment. And from then until now, when I buy goods, I don't have any invoices. Now when the tax authority requests it, I don't have one, so I have a question: When buying goods in the form of flat-rate tax, do I need to get input invoice?
Please advise. Thankyou.
Does an individual business household that purchases goods with the applicable form as flat-rate tax need to get an input invoice in Vietnam?
According to Clause 2, Article 7, Circular 40/2021/TT-BTC has the following regulations:
2. Household businesses and individual businesses paying fixed tax (hereinafter referred to as “fixed tax payers”) are not required to do accounting. Fixed tax payers shall retain and present to tax authorities the invoices, contracts, documents proving the legality of their goods and services when applying for issuance or sale of separate invoices. Fixed tax payers having business operation at bordering markets, checkpoint markets, markets within border-gate economic zones in Vietnam shall retain invoices, contracts, documents proving the legality of their goods and present them at the request of competent authorities.
Accordingly, if your business pays taxes using the flat-rate tax method, when purchasing goods, you must get an input invoice and present it to the tax authority to prove that your goods and services are legal when applying for a license, retail invoices each time they arise in Vietnam.
Does an individual business household that purchases goods with the applicable form as flat-rate tax need to get an input invoice in Vietnam? (Image from the Internet)
Can fixed tax payers have their company declare and pay taxes on their behalf with a commercial discount in Vietnam?
At Point c, Clause 1 and Clause 3, Article 8, Circular 40/2021/TT-BTC stipulates the tax calculation method for cases where organizations and individuals declare tax on behalf of and pay tax on behalf of individuals as follows:
1. An organization or individual shall declare and pay tax on behalf of another individual in the following cases:
c) The organization pays bonuses, sales compensation, promotions, commercial discounts, payment discounts, assistance in cash or not in cash, compensations for breach of contract, other compensations for fixed tax payers;
3. In case the individual earns a revenue of not exceeding 100 million VND/year at multiple locations, the individual estimates or determines that the total revenue exceeds 100 million VND/year, he/she may authorize the paying organization to declare and pay tax on the revenue generated at the authorized unit in the tax year. In case a fixed tax payer also receives bonuses, sales compensation, promotions, commercial discounts, payment discounts, assistance in cash or not in cash, compensations for breach of contract, other compensations in addition to presumptive revenue, the paying organization shall declare and pay tax on the actual amounts in the tax year on behalf of the individual. In case an organization declares and pays tax on behalf of an individual who leases out his/her property, the revenue of not exceeding 100 million VND/year as the basis for determination of eligibility for tax exemption shall be determined in accordance with Point c Clause 1 Article 9 of this Circular.
In addition, in Appendix I List of business lines subject to VAT, pit payable by household businesses and individual businesses, tax rates issued with Circular 40/2021/TT-BTC stipulates as follows:
|
No. |
Business lines |
VAT rate |
PIT rate |
|
1. |
Distribution, provision of goods |
|
|
|
- Wholesaling, retailing of goods (except commission agents); - Bonuses, sales compensation, promotions, commercial discounts, payment discounts, assistance in cash or not in cash for fixed tax payers; |
1% |
0,5% |
Thus, when the company pays commercial discounts to contractors, the company is responsible for declaring and paying taxes on behalf of the company with a value-added tax rate of 1% and personal income tax of 0.5% in Vietnam.
What are deadlines for submission of tax declaration dossiers for fixed tax payers in Vietnam?
Pursuant to Clause 2, Article 44 of the Law on Tax Administration 2019 stipulates as follows:
2. For taxes declared annually:
a) For annual tax statement dossiers: the last day of the 3rd month from the end of the calendar year or fiscal year. For annual tax declaration dossiers: the last day of the first month from the end of the calendar year or fiscal year
b) For annual personal income tax statements prepared by income earners: the last day of the 4th month from the end of the calendar year;
c) For presumptive tax declarations prepared by household businesses and individual businesses: the 15th of December of the preceding year. For new household businesses and individual businesses: within 10 days from the date of commencement of the business.
According to this Article, the time to submit tax declaration documents for fixed tax payers is December 15 of the preceding year at the latest in Vietnam.
Best regards!
