The General Department of Taxation to guide the classification of VAT refund dossiers in Vietnam

The General Department of Taxation to guide the classification of VAT refund dossiers in Vietnam (Internet image) 

Regarding this issue, LawNet would like to answer as follows:

On September 18, 2023, the General Department of Taxation issued Decision 1388/QD-TCT applying risk management in classifying value-added tax refund dossiers and selecting taxpayers to develop a plan for inspection and post-tax refund inspection.

Principles for classifying VAT refund dossiers in Vietnam

Right on the working day, the Risk Management application automatically returns the results of classifying VAT refund documents as "tax refund in advance" or "check before tax refund" to the TMS application for the tax refund system according to tax refund dossier classification form 02/QD-HT issued together with Decision 679/QD-TCT in 2023.

In case the Risk Management application of the tax refund system has problems and does not return results after the above time, the Risk Management department will prepare a proposal for a solution according to Form No. 08-QLHT/QD-QLRR, issued in Decision 1388/QD-TCT, transferring tax authority leaders to approve the manual risk assessment and analysis plan for tax refund dossiers according to "In cases where data analysis and risk management applications have not been applied to classify tax refund documents" specified in Clause 2, Article 7 of the Tax Refund Process issued in Decision 679/QD-TCT.

(Clause 1, Article 11, Decision 1388/QD-TCT)

The General Department of Taxation to guide the classification of VAT refund dossiers in Vietnam 

The classification of VAT refund dossiers is guided by the General Department of Taxation as follows:

- Tax refund documents are at high tax risk: Check first, refund later

For 12 consecutive months from the beginning of the fiscal year, taxpayers have consecutive tax refund records that are assessed as high-risk:

+ In case the ongoing risk assessment compared to the previous assessment differs in the total number of risk points or the risk score at each criterion or criterion index, Tax refund dossiers are subject to inspection first and a tax refund later.

+ In case the ongoing risk assessment compared to the previous assessment has the same total score and number of points for each criterion and index; or the tax refund dossier in progress compared to the previous assessment has a lower risk score for each index, resulting in a corresponding lower total risk score:

(i) The results of checking the previous tax refund dossier or post-refund inspection do not detect any incorrect declaration leading to a lack of tax payable or an increase in the tax refund amount; the next tax refund dossier is not subject to pre-refund inspection.

(ii) In case an inspection of the previous tax refund dossier or a post-refund inspection or inspection detects an incorrect declaration, leading to a lack of tax payable or an increase in the tax refund amount, the next tax refund dossier is subject to inspection before the tax refund.

- Tax refund dossiers of medium-risk and low-risk: tax refund done first, check later.

(Clause 2, Article 11, Decision 1388/QD-TCT)

Processing results of classifying VAT refund dossiers in Vietnam

In case, after applying Risk Management, the VAT refund dossier is classified as subject to tax refund before checking later, but during the resolution process, according to the provisions of the Tax Refund Process issued in Decision 679/QD-TCT, Circular 80/2021/TT-BTC, tax authorities transfer documents to pre-audit status (before paying notice of acceptance of tax refund documents of taxpayers), and the TMS application must update the status and reason for transferring the pre-check and update it to the Tax Refund System Risk Management application to track and exclude post-tax refund checks and inspections.

The results of classifying and processing tax refund dossiers and changing the results of classifying and processing tax refund dossiers are stored on the Risk Management application according to form number 07-QLHT/QD-QLRR issued together with Decision 1388/QD-TCT.

(Clause 3, 4, Article 11 of Decision 1388/QD-TCT)

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