Instructions for making invoices to reduce VAT to 8% in Vietnam 2022

Instructions for making invoices to reduce VAT to 8% in Vietnam 2022

The General Department of Taxation of Vietnam guides the issuance of invoices to reduce VAT to 8% by 2022 in some cases as follows:

- In case goods and services are eligible for VAT reduction according to Decree 15/2022/ND-CP, after December 31, 2022, and it is discovered that there is an error, it must issue an adjusted or replaced invoice without affecting the amount of goods and payable VAT or adjusting the tax calculation price, adjusted or replaced invoices with the VAT rate of 8%;

Where errors in quantity of goods lead to errors in goods and VAT, the adjusted or replaced invoice shall apply the VAT rate prescribed at the time of making the adjusted or replaced invoice.

- In case of goods purchased before January 1, 2023, at the tax rate of 8%, after December 31, 2022, if the buyer returns the goods due to improper specifications and quality, the seller issues a goods return invoice to reduce or replace the issued invoice with the VAT rate of 8%. The seller and the buyer have an agreement to clearly state the returned goods.

- In case the business establishment applies the form of commercial discount for customers and for commercial discounts of goods eligible for VAT reduction at the rate of 8% sold in 2022 but only invoices are issued from January 1, 2023, showing the content of the trade discount:

+ In case the discount amount is made on the last purchase or the next period after December 31, 2022, the discount amount of the sold goods is calculated and adjusted at the taxable price content, and the tax rate shall comply with the current law at the time of making the invoice.

+ In case the discount amount is made at the end of the discount program (period) after December 31, 2022, the seller shall issue an adjusted invoice and apply the VAT rate of 8% at the time of sale.

- In cases where business establishments sell goods or provide services (subject to VAT reduction according to Decree 15/2022/ND-CP),
but after December 31, 2022, new business establishments will issue invoices for revenue from selling goods and services arising from February 1, 2022, to December 31, 2022 and construction and installation activities with the time of acceptance, handover of works, work items, and completed construction and installation volumes, regardless of whether money has been collected or not, are determined from February 1, 2022, to the end of December 31, 2022, but after December 31, 2022, new business establishments issue invoices for revenue from construction and installation that have been tested and handed over if the invoice is issued at the wrong time, the VAT reduction will be applied according to Decree 15/2022/ND-CP, and the administrative violation will be handled for the act of making invoices at the wrong time.

More details can be found in Official Dispatch 2121/TCT-CS, dated May 29, 2023.

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