In Vietnam, is it necessary to issue a VAT invoice when exporting software to a foreign company?

In Vietnam, is it necessary to issue a VAT invoice when exporting software to a foreign company?

Pursuant to Clause 1, Article 8 of the Decree 123/2020/ND-CP stipulating invoice types in Vietnam as follows: 

Invoices prescribed herein are classified into the following types:

1. Value-added tax (VAT) invoice is an invoice which may be used by organizations making VAT declaration by employing the credit-invoice method for the following activities:

a) Domestic sale of goods or provision of services;

b) Provision of international transport services;

c) Export of goods to free trade zones and other cases considered as export of goods;

d) Export of goods or provision of services in a foreign market.

As regulations above, enterprises have to issue VAT invoices when exporting goods or providing services in a foreign market.

In Vietnam, is it permissible for export invoices be used in foreign languages?

Pursuant to Clause 13, Article 10 of the Decree 123/2020/ND-CP stipulating contents of invoices in Vietnam as follows:

13. Text, numbers and currencies on invoices:

a) The text on an invoice must be written in Vietnamese language. If foreign language text is necessary, it must be placed between parentheses ( ) or next to the Vietnamese text, in which case it must be smaller than the Vietnamese text. If the text has to be written in Vietnamese without diacritics, it must not cause the readers to misunderstand its contents.

b) Numbers on the invoice must be written in Arabic numerals: 0, 1, 2, 3, 4, 5, 6, 7, 8, 9. The seller may decide whether to use a period (.) as thousands separator and a comma (,) as a decimal separator, or vice versa.

c) The currency on invoices shall be VND, expressed as “D".

- If a foreign currency is used in an economic/financial transaction in accordance with regulations of the law on foreign exchange, the unit price, amounts, VAT amount by VAT rate, total VAT amount, and total amount payable shall be written in the foreign currency. The currency unit shall be the name of that foreign currency. The seller shall write the exchange rate of the foreign currency to VND on invoices in accordance with the Law on Tax administration and its instructional documents.

- International currency symbols shall be used. (e.g. 13.800,25 USD – Thirteen thousand eight hundred US dollars and twenty five cents, or 5.000,50 EUR - Five thousand euros and fifty cents).
- If the goods/services are paid for in a foreign currency in accordance with the Law on foreign exchange and on which tax is also paid in a foreign currency, the total amount payable shall be written in the foreign currency instead of converted into VND.

As regulations above, if foreign language text is necessary, it must be placed between parentheses ( ) or next to the Vietnamese text, in which case it must be smaller than the Vietnamese text.

Best regards!