The General Department of Taxation's request regarding strengthening management of taxes incurred from goods purchase using statements in Vietnam

The General Department of Taxation's request regarding strengthening management of taxes incurred from goods purchase using statements in Vietnam

The General Department of Taxation of Vietnam request that the Departments of Taxation shall, during their inspection, intensify verification of purchases of goods and services using statements as prescribed in Point 2.4 Clause 2 Article 6 of the Circular 78/2014/TT-BTC (as amended by Article 4 of the Circular 96/2015/TT-BTC ) in order to determine the validity and legitimacy of these statements which shall be then used as the basis for determining deductible expenses upon calculation of corporate income tax, ensuring compliance with laws and avoiding loss of state budget’s revenue.

During inspection and verification, any taxpayers that are found to have committed violations against regulations of laws on taxation shall face penalties as prescribed, or, if they are found to denote crimes, shall be transferred to competent authorities for consideration as prescribed by laws.

Specifically, Point 2.4, Clause 2, Article 6 of Circular 78/2014/TT-BTC (amended in Circular 96/2015/TT-BTC) regulates expenditures on purchases of goods/services without statements enclosed with receipts for payments to sellers/service providers in the cases below:

- Purchase of agricultural products, forestry products, aquaculture products directly sold by growers or catchers;

- Purchase of handicraft products made of dried jute, sedge, leaves, rattan, bamboo, straw, coconut shell, or aquaculture by-products directly by craftsmen.

- Purchase of earth, stones, sand, gravel directly sold by the excavating people;

- Purchase of scrap from collectors;

- Purchase of items, property, services from non-business households and non-business individuals;

- Purchase of goods/services from business households and business individuals (except for the cases mentioned above) whose revenue is below the level subject to VAT (VND 100 million per year).

A statement of purchases of goods/services signed by the enterprises’ legal or authorized representative, who takes legal responsibility for its accuracy. The enterprise that buys goods/services may make a statement and include them in deductible expenses. Proof of cashless payment is not required for such expenses.

If the buying prices for goods/services on the statement are higher than market prices at that time, the tax authority shall recalculate the deductible expenses according to the market prices for similar goods/services.

More details can be found in Official Dispatch 1336/TCT-TTKT of Vietnam issued on April 2, 2024.

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