Household Businesses Must Declare and Calculate VAT Using the Deduction Method

According to Clause 1, Article 5 of Circular 119/2014/TT-BTC (Amending Circular No. 39/2014/TT-BTC) as follows:

Value-added tax invoices (Form No. 3.1 Appendix 3 and Form No. 5.1 Appendix 5 attached to this Circular) are types of invoices intended for organizations that declare and calculate value-added tax by the credit method in the following activities:

- Sale of goods, provision of domestic services;

- International transportation activities;

- Export to non-tariff zones and cases deemed as export;

And under Clause 4, Article 1 of the amended Value-Added Tax Law of 2013:

...

Business establishments voluntarily registering to apply the credit method of tax deduction, except for households and individual businesses.

Thus, business households are not required to declare and calculate VAT by the credit method according to current regulations.

Sincerely!