Guidelines for the Latest Regulations on Value-Added Tax Refund in Vietnam

Guidelines for the Latest Regulations on Value-Added Tax Refund in Vietnam​ (Image from the Internet)

1. Guidelines for the Latest Regulations on Value-Added Tax Refund in Vietnam

Article 10 of Decree No. 209/2013/ND-CP (amended by Clause 6, Article 1 of Decree No. 100/2016/ND-CP and Clause 3, Article 1 of Decree No. 49/2022/ND-CP) stipulates the value-added tax refund as follows:

- Business establishments that pay value-added tax using the credit method, if they have input value-added tax that has not been fully credited in the month (for monthly declaration) or in the quarter (for quarterly declaration), will be credited to the next period.

- Business establishments are eligible for tax refunds for investment projects as follows:

+ Business establishments that have registered for business and value-added tax payment using the credit method (including newly established business establishments from investment projects) that have new investment projects (including projects divided into multiple investment phases or investment items) according to the provisions of the Investment Law 2020 in the same province/city or different province/city from the head office location (except for the cases specified in point c, clause 2, Article 10 of Decree 209/2013/ND-CP and investment projects for building houses for sale, projects that do not form fixed assets) that are in the investment phase or projects for oil and gas exploration and development that are in the investment phase, with input value-added tax on goods and services incurred during the investment phase, aggregating to uncredited amounts of 300 million VND or more, are eligible for value-added tax refunds.

Business establishments must file separate value-added tax returns for investment projects and offset the input value-added tax of the investment project against the output value-added tax of current production and business activities (if any). After offsetting, if the cumulative uncredited input value-added tax of the investment project amounts to 300 million VND or more, the value-added tax will be refunded.

In cases where the investment project of the business establishment has been audited or inspected by competent state agencies, the tax authority may use the inspection, audit results to decide on the value-added tax refund.

+ For investment projects by business establishments in industries, conditional business sectors under the following circumstances, the business establishment is eligible for value-added tax refunds for the investment project according to point a, clause 2, Article 10 of Decree No. 209/2013/ND-CP:

++   Investment   projects   in   the   investment   phase,   as   per   investment   laws,   sectoral   laws   have   been   issued   a   business   license   for   conditional   business   sectors   by   a   competent   state   agency   in   one   of   the   following   forms:   License   or   certificate   or   confirmation,   approval   document.

++   Investment   projects   in   the   investment   phase,   as   per   investment   laws,   sectoral   laws   have   not   yet   required   a   competent   state   agency   to   issue   a   business   license   for   conditional   business   sectors   in   one   of   the   following   forms:   License   or   certificate   or   confirmation,   approval   document.

++   Investment   projects   according   to   investment   laws,   sectoral   laws,   do   not   need   a   business   license   for   conditional   business   sectors   in   one   of   the   following   forms:   License   or   certificate   or   confirmation,   approval   document.

+  Business  establishments  are  not  eligible  for  value-added  tax  refunds  but  are  allowed  to  carry  forward  uncredited  tax  amounts  of  the  investment  project  according  to  investment  laws  to  the  next  period  in  cases  where:

++   Investment   projects   of   business   establishments   in   conditional   business   sectors   when   they   do   not   meet   the   business   conditions   as   per   the   provisions   of   the   Investment   Law   2020   stipulated   at   point   a,   clause   1,   Article   13   of   the   Value-Added   Tax   Law   2008,   as   amended   and   supplemented   by   the   Law   on   Amendments   and   Supplements   to   Certain   Articles   of   the   Value-Added   Tax   Law   2013,   Special   Consumption   Tax   Law   2013,   and   Tax   Administration   Law   2019   are   investment   projects   of   business   establishments   in   conditional   business   sectors   but   have   not   been   granted   a   business   license   in   conditional   business   sectors   by   competent   state   agencies   in   one   of   the   following   forms:   License   or   certificate   or   confirmation,   approval   document   or   do   not   meet   the   conditions   to   carry   out   conditional   business   activities   without   requiring   written   confirmation,   approval   as   per   investment   laws   (except   for   cases   specified   in   point   b,   clause   2,   Article   10   of   Decree   No.   209/2013/ND-CP).

Investment   projects   of   business   establishments   in   conditional   business   sectors   do   not   ensure   the   maintenance   of   sufficient   business   conditions   during   operation   as   stipulated   at   point   a,   clause   1,   Article   13   of   the   Value-Added   Tax   Law   2008,   as   amended   and   supplemented   by   the   Law   on   Amendments   and   Supplements   to   Certain   Articles   of   the   Value-Added   Tax   Law   2013,   Special   Consumption   Tax   Law   2008,   and   Tax   Administration   Law   2019   are   investment   projects   of   business   establishments   in   conditional   business   sectors   but   during   operation   the   business   establishment   has   been   revoked   one   of   the   conditional   business   sector   licenses:   License,   certificate   or   confirmation   document,   approval;   or   during   operation,   the   business   establishment   does   not   meet   the   conditions   to   carry   out   conditional   business   activities   according   to   investment   laws,   then   the   time   point   for   not   refunding   value-added   tax   is   calculated   from   the   time   the   business   establishment   is   revoked   one   of   the   aforementioned   documents   or   the   time   the   competent   state   agency   checks   and   detects   that   the   business   establishment   does   not   meet   the   conditions   for   conditional   business   activities.

++   Investment   projects   exploiting   resources,   minerals   that   have   been   licensed   from   July   01,   2016,   or   investment   projects   producing   products   and   goods   where   the   total   value   of   resources,   minerals   plus   energy   costs   account   for   51%   or   more   of   the   product   cost   according   to   the   investment   project,   except   for   exploration   and   development   of   oil   and   gas   stipulated   at   point   a,   clause   2,   Article   10   of   Decree   No.   209/2013/ND-CP.

The  determination  of  resources,  minerals;  value  of  resources,  minerals,  and  the  time  for  determination  of  the  value  of  resources,  minerals  and  energy  costs  are  conducted  according  to  the  provisions  of  clause  11,  Article  3  of  Decree  No.  209/2013/ND-CP.

2. Regulations on the Latest Value-Added Tax Filing Locations in Vietnam

Article 11 of Decree No. 209/2013/ND-CP stipulates the value-added tax filing locations as follows:

- Taxpayers declare and file value-added tax at the locality where the production and business activities take place.

- Taxpayers declaring and filing value-added tax according to the credit method, if they have dependent production facilities located in provinces or cities other than where the head office is located, must file value-added tax at the locality where the production facility is located and where the head office is located.

To Quoc Trinh

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