What are instructions for handling invoices with missing lines for organizations and individuals in free trade zones in Vietnam?

Are invoices accepted when lines for organizations and individuals in free trade zones are missing in Vietnam?

In Clause 2, Article 8, Decree 123/2020/ND-CP stipulates the following types of invoices:

Invoice types

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2. Sales invoice is an invoice which may be used by the following organizations and individuals:

a) Organizations or individuals that declare and calculate VAT by employing direct method for the following activities:

- Domestic sale of goods or provision of services;

- Provision of international transport services;

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

- Export of goods or provision of services in a foreign market.

b) Organizations or individuals in free trade zones that sell goods or provide services to the domestic market, sell goods or provide services to other organizations/individuals in free trade zones, or sell goods or provide services to a foreign market. In such cases, invoices must bear the phrase “Dành cho tổ chức, cá nhân trong khu phi thuế quan” ("For organizations/individuals in free trade zones”).

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In Clause 9, Article 3 of Decree 123/2020/ND-CP, there are regulations on illegal use of an invoice or record as follows:

Explanation of words

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“illegal use of an invoice or record” means the use of an invoice or record which does not contain all of compulsory contents required by law; the use of an invoice which has been erased or altered against regulations; the use of a fraudulent invoice or record (i.e. an invoice or record in which items and contents about a transaction has been specified but the sale of goods or provision of service is partially or entirely untrue); the use of an invoice which incorrectly reflects the actual payment value or the creation of a fraudulent or fake invoice; the use of an invoice between whose copies there is the difference in the value of goods or service, or compulsory contents; the rotation of an invoice for another during the transportation of goods in circulation or the use of an invoice of a good or service for another good or service; the use of an invoice or record of another entity (except the tax authority’s invoice and unless an invoice is issued with authorization) for the purpose of making the purchased or sold good or service legal; the use of an invoice or record which is determined to be illegal by a tax authority, police authority or another regulatory authority.

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According to this Article, when selling goods and providing services to the domestic market and when selling goods and providing services between organizations and individuals in the free trade zone, exporting goods and providing services abroad. Foreign countries must clearly state "For organizations and individuals in the free trade zone".

Thus, invoices issued by organizations in the free trade zone that lack the line "For organizations and individuals in the free trade zone" will not be accepted.

What are instructions for handling invoices with missing lines for organizations and individuals in free trade zones in Vietnam? (Image from the Internet)

What are instructions for handling invoices with missing lines for organizations and individuals in free trade zones in Vietnam?

At Point b2, Clause 2, Article 19 of Decree 123/2020/ND-CP, there are regulations on handling of erroneous invoices as follows:

Handling of erroneous invoices

2. If an authenticated or unauthenticated e-invoice which has been sent to the buyer is detected by either the buyer or seller to contain errors, it shall be handled as follows:

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b) If the information about TIN, amount, tax rate, tax amount or goods on the invoice is wrong, the error shall be handled by adopting one of the following methods:

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b2) The seller issues a new e-invoice to replace the erroneous one. The seller and the buyer shall prepare a document specifying the errors as agreed upon between them before the seller issues a new e-invoice to replace the erroneous one.

The replacing invoice shall bear the text “Thay thế cho hóa đơn Mẫu số... ký hiệu... số... ngày... tháng... năm” (“This invoice replaces the invoice form No……….., reference No………, No………dated……….”).

The seller shall add the digital signature on the e-invoice which is issued to correct or replace the erroneous one, then send it to the buyer (in case of unauthenticated invoices) or send it to the tax authority for its issue of a new authentication code (in case of authenticated invoices).

In Official Dispatch 32108/CTHN-TTHT of 2023, there are instructions on handling invoices made with errors as follows:

In case it is discovered that the issued invoice has errors (lack of mandatory expenditure "For organizations and individuals in the free trade zone") and the invoice has been sent to the buyer, the seller will issue a new electronic invoice to replace it as prescribed in Point b2, Clause 2, Article 19 of Decree No. 123/2020/ND-CP.

Thus, the way to handle invoices lacking the line "For organizations and individuals in the free trade zone" is as follows:

- The seller issues a new electronic invoice to replace the erroneous electronic invoice;

Note: If the seller and buyer have agreed to prepare a written agreement before issuing an invoice to replace the invoice that has errors, then the seller and buyer shall make a written agreement clearly stating the errors, The seller then issues an electronic invoice to replace the invoice that was created with errors.

The new electronic invoice to replace the electronic invoice that was created with errors must have the words "Replace for invoice Model number... symbol... number... date... month... year" .

- The seller digitally signs the newly adjusted electronic invoice; or replace an electronic invoice that has been created with errors and then the seller sends it to the buyer (in case of using an electronic invoice without a tax authority code);

Or in case of using an electronic invoice with a tax authority code, send it to the tax authority so that the tax authority can issue a code for a new electronic invoice to send to the buyer.

Which organizations are allowed to operate in the free trade zone in Vietnam?

In Article 5, the Regulation on operation of non-tariff areas in economic zones and border-gate economic zones issued together with Decision 100/2009/QD-TTg stipulates that entities operating in non-tariff areas (below collectively referred to as non-tariff area enterprises) include:

- Vietnamese traders:

- Branches and representative offices of Vietnamese traders;

- Branches and representative offices of Vietnam-based foreign traders:

- Investors as defined in the investment law.

Best regards!