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THE
NATIONAL ASSEMBLY
OF VIETNAM
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THE
SOCIALIST REPUBLIC OF VIETNAM
Independence - Freedom – Happiness
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Law
No. 48/2024/QH15
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Hanoi,
November 26, 2024
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LAW
ON VALUE-ADDED TAX
Pursuant to the Constitution of
the Socialist Republic of Vietnam;
The National Assembly promulgates
the Law on Value-added Tax
Chapter I
GENERAL PROVISIONS
Article 1.
Scope
This Law prescribes goods and
services subject to VAT, goods and services not subject to VAT, taxpayers,
basis and methods for calculation, deduction and refund of value-added tax
(VAT).
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VAT means tax imposed on added
value of goods and services during the process from production, circulation and
consumption.
Article 3.
Goods and services subject to VAT
Goods and services used for production,
business operation (hereinafter referred to as “business operation”) and
consumption in Vietnam are subject to VAT, except for those specified in
Article 5 of this Law.
Article 4.
Taxpayers
1. Organizations, households,
individuals that manufacture and/or sell goods and/or services subject to VAT
(hereinafter referred to as “business establishments").
2. Organizations and individuals
that import goods subject to VAT (hereinafter referred to as “importers").
3. Organizations and individuals
having business operation in Vietnam buying services (including services
attached to goods) from overseas organizations without permanent establishments
in Vietnam, from overseas individuals that are not residents of Vietnam
(hereinafter referred to as “non-residents”), except for the cases specified in
Clause 4 and Clause 5 of this Article; organizations having business operation
in Vietnam buying goods and services serving petroleum exploration and
extraction by overseas organizations without permanent establishments in
Vietnam, or by overseas non-residents of Vietnam.
4. Foreign suppliers without
permanent establishments in Vietnam doing e-commerce business or digital
platform-based business with organizations and individuals in Vietnam
(hereinafter referred to as “foreign suppliers"); organizations managing
foreign digital platforms that deduct and pay tax incurred by foreign suppliers
on their behalf; business organizations in Vietnam that apply credit-invoice
method to calculate VAT on services purchased from foreign suppliers without
permanent establishments in Vietnam via e-commerce channels or digital
platforms, deduct and pay tax incurred by foreign suppliers on their behalf.
5. Organizations managing
e-commerce exchanges or digital platforms with payment feature that deduct, pay
and declare deducted tax on behalf of household businesses and individual
businesses on such commerce exchanges or digital platforms.
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Article 5.
Goods and services not subject to VAT
1. Products from plants, cultivated
forests, husbandry, aquaculture, fishery that have not been processed into
other products or have only undergone preliminary processing by the
manufacturers or catchers when they are sold and imported.
2. Products of breeds prescribed by
regulations of law on husbandry, propagation materials prescribed by
regulations of law on farming.
3. Animal feeds prescribed by
regulations of law on husbandry; aquatic feeds prescribed by regulations of law
on aquaculture.
4. Salt products produced from
seawater, natural rock salt, refined salt, iodized salt of which the primary
constituent is sodium chloride (NaCl).
5. State-owned housing sold by the
State to the current tenants.
6. Irrigation and drainage; land
plowing and harrowing; dredging of intra-field canals and ditches serving
agricultural production; harvesting services.
7. Transfer of land use rights
(LUR).
8. Life insurance, health
insurance, insurance for students, other insurances related to humans,
insurance for animals, insurance for plants, other agricultural insurances;
insurance for boats, ships, and other equipment necessary for fisheries;
reinsurance; insurances for petroleum works and equipment, oil tankers with
foreign nationalities hired by foreign subcontractors or petroleum contractors
to operate within territorial seas of Vietnam and overlapping maritime zones
that have been put under joint development agreements between Vietnam and
countries whose coastlines are adjacent or opposite to each other.
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a) Credit extension services
prescribed by regulations of law on credit institutions and fees specified in
lending agreements between the Government of Vietnam and foreign lenders;
b) Lending services provided by
taxpayers that are not credit institutions;
c) Securities trading services
including securities brokerage, proprietary trading of securities, securities
issuance guarantee; securities investment consulting; securities investment
fund management; securities investment portfolio management prescribed by
securities laws;
d) Capital transfer including:
transfer of part or all of capital invested in another business organization
(regardless of establishment of a new juridical person), transfer of
securities, transfer of the right to contribute capital and other forms of
capital transfer prescribed by law, including selling an enterprise to another
enterprise for business operation where the buying enterprise inherits all
rights and obligations of the enterprise being sold as prescribed by law.
Capital transfer prescribed in this Point does not include transfer of
investment projects and sale of assets;
dd) Sale of debts including sale of
amounts payable and amounts receivable;
e) Trading in foreign currencies;
g) Derivatives prescribed by
regulations of law on credit institutions, securities and commerce, including:
interest rate swap, forward contracts, futures contracts (futures); call
options, put options and other derivatives;
h) Sale of collateral for debts of
organizations 100% of charter capital of which is held by the State
(hereinafter referred to as “wholly state-owned organizations”) which are
established by the Government to settle bad debts of Vietnamese credit
institutions.
10. The following healthcare and
veterinary services:
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Care for elderly and disabled
people include medical care, nitration and organization of culture, sport,
entertainment activities, physical therapy, and rehabilitation for elderly and
disabled people.
In case the medical service package
prescribed by the Ministry of Health includes medicines, the revenue from
medicines in such service package is also NOT subject to VAT;
b) Veterinary medicine services
include: medical examination, treatment and disease prevention for domesticated
animals.
11. Funeral services.
12. Renovation, repair and
construction of historical – cultural remains, scenic beauties, cultural,
artistic works, public service works, infrastructure and housing for social
policy beneficiaries which are funded with the people’s contributions or
humanitarian aid (making up at least 50% of the total investment in the work).
13. Teaching and vocational
training prescribed by regulations of law on education and vocational
education.
14. Radio and television
broadcasting funded by state budget.
15. Publishing, importing, issuing
newspapers, magazines, academic journals, political books, text books, law
books, science – technology books, books serving diplomatic communication,
books in ethnic languages, printing propaganda pictures and banners, including
audio, video tapes, discs, or computer files; money, money printing.
16. Mass transit by bus, electric
train, inland waterway vehicle.
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18. Defense and security products
on the lists promulgated by the Minister of National Defense and the Minister
of Public Security; goods and services imported to serve defense and security
industry on the lists promulgated by the Prime Minister.
19. Imports in case of humanitarian
aid or grant aid. Goods and services sold to foreign organizations or
individuals or international organizations for use as humanitarian aid or grant
aid for Vietnam.
20. Goods undergoing merchanting
trade or transit through Vietnam’s territory; goods temporarily imported for
re-export; goods temporarily exported for re-import; raw materials imported for
the production or processing of exports under contracts with foreign parties;
goods and services traded between foreign countries and free trade zones and
between free trade zones.
Goods imported under a finance
lease contract by the finance company (the lessor) and directly transported to
a free trade zone for use by a lessee therein.
21. Technology transfer under the
Law on Technology Transfer; transfer of intellectual property rights under the
Law on Intellectual Property; software products and software serves prescribed
by law.
22. Gold imported in the form of
bars or ingots which have not yet been processed into fine-art articles,
jewelries or other products during import.
23. Exports that are raw natural
resources or minerals that have not been processed into other products; exports
that are raw natural resources or minerals that have been processed into other
products on the list of raw natural resources and minerals restricted from
export promulgated by the Government of Vietnam..
24. Artificial organs for humans,
including those for long-term transplantation; crutches, wheelchairs and other
tools used exclusively for the disabled.
25. Goods and services manufactured
or sold by business households and individuals that earn annual revenue of at
least 200 million VND; assets sold by organizations and individuals that do not
do business and are not VAT payers; goods in national reserves sold by national
reserves agencies; fees and charges prescribed by regulations of law on fees
and charges.
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a) Gifts for state agencies,
political organizations, socio-political organizations,
socio-political-professional organizations, social organizations,
socio-professional organizations or peoples armed forces units within duty-free
allowances according to regulations of law on export and import duties;
b) Donations and gifts within
import duty exemption quota according to regulations of law on export and
import duties given by foreign organizations and individuals to Vietnamese
individuals; personal belongings of foreign organizations and individuals
within diplomatic immunity quotas and movable assets within import duty
exemption quota according to regulations of law on export and import duties;
c) Goods within duty-free luggage
quotas according to regulations of law on export and import duties;
d) Goods imported as donations for
recovery from natural disasters, epidemics or wars as per regulations of the
Government;
dd) Goods traded or exchanged
across the border to serve production or consumption by border residents on the
List of goods traded or exchanged by border residents as prescribed by law and
within the import duty exemption quota according to regulations of law on
export and import duties;
e) Relics, antiques, national treasures
prescribed by regulations of law on cultural heritage imported by competent
authorities.
27. Establishments selling goods
and services not subject to VAT specified in this Article are not entitled to
input VAT deduction and refund, except the cases eligible for 0% VAT specified
in Clause 1 Article 9 of this Law.
28. The Government shall elaborate
this Article. The Minister of Finance shall prescribe documentation and
procedures for identification of goods and services not subject to VAT
prescribed in this Article.
Chapter II
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Article
6. Tax bases
The bases for VAT
calculation include taxable price and tax rate.
Article
7. Taxable prices
1. Taxable prices
are specified below:
Taxable prices of
goods and services are VAT-exclusive prices; taxable prices of goods and
services subject to excise duty are the prices inclusive of excise duty and
exclusive of VAT; taxable prices of goods subject to environmental protection
tax are prices inclusive of environmental protection tax and exclusive of VAT;
taxable prices of goods subject to excise duty and environmental protection tax
are prices inclusive of excise duty and environmental protection tax and
exclusive of VAT;
b) Taxable prices
of imports are dutiable values (values on which import duty is charged) as
prescribed by regulations of law on export and import duties plus (+) import
duty plus (+) extra import duties as prescribed by law (if any), plus (+)
excise duty (if any) plus (+) environment protection tax (if any);
c) Taxable prices of goods and
services used for barter, internal consumption or donation are the prices for
calculating VAT on goods and services of the same or equivalent kinds at the
time of barter, consumption or donation.
VAT on promotional
goods and services prescribed by regulations of law on commerce shall be 0
(zero);
d) Taxable prices for lease of
assets are the rents exclusive of VAT.
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dd) Taxable prices
of goods sold by installment or deferred payment are the one-off selling prices
of such goods, exclusive of value-added tax and the instalment or deferral
interest;
e) Taxable prices
for goods processing are the payment for processing exclusive of VAT;
g) Taxable prices
for construction and installation activities are the value of the completed and
transferred work, item or task, exclusive of VAT. If the value of the
construction or installation contract does not cover building materials,
machinery or equipment, the taxable price is the construction or installation
value, excluding the value of materials, machinery or equipment;
h) For real estate
business, taxable prices are selling prices for real estate exclusive of VAT,
excluding the land levies or land rents payable to state budget (deductible
land prices). The Government shall provide for determination of deductible land
prices in accordance with land laws;
i) For
commission-based agent activities and brokerage of goods and services, taxable
prices are the commission on these activities exclusive of VAT;
k) If the amount
payable on the invoice for goods and services is inclusive of VAT, the taxable
price shall be calculated as follows:
VAT-exclusive
price
=
Amount
payable
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l) For services
including casino business, video games of chance and betting, taxable prices are
revenues from these activities minus (-) the amounts exchanged and returned to
players and the prizes given to players (if any), inclusive of excise duty and
exclusive of VAT;
m) For business
operations including: electricity generation by Vietnam Electricity (EVN);
transport, material handling; tourism services; pawnshop business; books
subject to VAT sold at cover prices; printing; remuneration- or
commission-based agent services including claim assessment, claim validation,
claiming indemnities from third parties, taxable prices are selling prices
exclusive of VAT. The Government shall prescribe taxable prices for business
operations mentioned in this Point.
2. Taxable prices
of goods and services specified in Clause 1 of this Article include surcharges
and extra fees to which business establishments are entitled.
3. The Government
shall elaborate this Article.
Article
8. Time for determination of VAT
1. Time for determination of VAT:
a) For goods, it
is the time of transfer of the right to own or the right to use the goods to
the buyer, or the time of issuance of the invoice, regardless of whether
payment is collected;
b) For services,
it is the time of completion of service provision or the time of issuance of
the service invoice, regardless of whether payment is collected.
2. The time for
determination of VAT on the following goods and services shall be prescribed by
the Government:
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b)
Telecommunications services;
c) Insurance
business services
d) Electricity
supply; electricity generation; clean water production;
dd) Real estate
business;
e) Construction,
installation and petroleum operations.
Article
9. VAT rates
1. 0% VAT shall
apply to the following goods and services:
a) Exports including:
goods from Vietnam sold to overseas organizations and individuals and consumed
outside of Vietnam; goods from the domestic market of Vietnam being sold to
organizations in free trade zones and consumed within free trade zones to serve
export manufacturing; goods sold within airside zones of airports for
individuals (foreigners or Vietnamese people) who have completed exit
procedures; goods sold at duty-free stores;
b) Export services
including: services directly provided for overseas organizations and
individuals and used outside of Vietnam; services directly provided for
organizations in free trade zones and used within free trade zones to serve
export manufacturing;
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d) 0% VAT shall not apply in the
following cases: technology transfer, transfer of intellectual property rights
to abroad; issuing reinsurance policies in foreign countries; credit extension
services; capital transfer; derivatives; postal and telecommunications
services; exports specified in Clause 23 Article 5 of this Law; tobacco and
alcohol that are imported and then exported; oil and gas purchased in Vietnam
and sold to business establishments in free trade zones; automobiles sold to
organizations and individuals in free trade zones.
2. 5% VAT shall apply to the
following goods and services:
a) Clean water for production and
daily life, excluding bottled water and other beverages;
b) Fertilizers; ores for fertilizer
production, plant protection chemicals and animal growth stimulators as
prescribed by law;
c) Services including digging,
embanking and dredging canals, ditches, ponds and lakes for agricultural
production; growing, tending, and preventing pests and insects for plants;
preparing, processing and preservation of agricultural products;
d) Products from plants, cultivated
forests (except timber and bamboo sprouts), husbandry, aquaculture, fishery
that have not been processed into other products or have only undergone
preliminary processing, except the products specified in Clause 1 Article 5 of
this Law;
dd) Rubber latex in the form of
crepe, sheets, rubber or nuggets; nets, ropes and fibers for making
fishing-nets;
e) Products made of jute, rush,
bamboo, leaf, straw, coconut husks and shells, hyacinth and other handicrafts
made of agricultural raw materials; preliminarily processed cotton; carded,
combed fibers; paper for newspaper printing;
g) Fishing vessels at sea;
specialized machinery and equipment for agricultural production as per
regulations of the Government;
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i) Teaching and learning equipment,
including: models, pictures, boards, chalks, rulers, compasses;
k) Traditional art performances;
l) Children toys; books except for
those specified in Clause 15 Article 5 of this Law;
m) Science and technology services
prescribed by the Law on Science and Technology;
n) Sale, lease, and lease purchase
of social housing according to the Law on Housing.
3. 10% VAT shall apply to the goods
and services that are not mentioned in Clause 1 and Clause 2 of this Article,
including services provided by foreign providers without permanent
establishments in Vietnam for organizations and individuals in Vietnam via
electronic commerce channels and digital platforms.
4. A business establishment sells
goods or services with different VAT rates (including goods and services not
subject to VAT) shall declare separate VAT rate for each type of goods and
services; If the business establishment cannot determine separate VAT rates,
the business establishment shall calculate and pay VAT at the highest VAT rate
on its goods or services.
5. Products from plants, cultivated
forests, husbandry, aquaculture, fishery that have not been processed into
other products or have only undergone preliminary processing and are used as
animal feeds or herbal ingredients shall apply the VAT rate for products from
plants, cultivated forests, husbandry, aquaculture.
When scraps,
byproducts, wastes recovered for recycling or reuse are sold, VAT rates on the
products being sold shall apply.
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Article
10. VAT calculation methods
VAT calculation
methods include credit-invoice method and direct method.
Article
11. Credit-invoice method
1. Credit-invoice
method:
a) VAT payable
equals (=) output VAT minus (-) deductible input VAT;
b) Output VAT is
the amount of VAT on sold goods and services written on the VAT invoices.
VAT on sold goods
and services written on the VAT invoice equals (=) the taxable prices of the
goods and services multiplied by (x) VAT rate on such goods and services.
If the amount
payable written on the invoice is inclusive of VAT, the output VAT shall equal
(=) the amount payable minus (-) taxable price determined according to Point k
Clause 1 Article 7 of this Law;
c) Deductible
input VAT equals (=) the total VAT written on the invoice for purchase of goods
and services or document on payment of VAT on imports or VAT payment document
in case of purchase of services specified in Clause 3 and Clause 4 Article 4 of
this Law and must satisfy the requirements specified in Article 14 of this Law.
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a) Business
establishments that earn annual revenue of at least 01 billion VND from sale of
goods and services goods sale, except household businesses and individual
businesses;
b) Business
establishments that voluntarily apply the credit-invoice method, except
household businesses and individual businesses;
c) Foreign
organizations and individuals providing goods and services serving petroleum
exploration and extraction that pay VAT using the credit-invoice method and
have VAT declared, deducted and paid on their behalf by Vietnamese parties.
3. The Government
shall elaborate this Article.
Article
12. Direct method
1. Added
value-based VAT equals (=) added value multiplied by (x) VAT rate on trade and
crafting of gold, silver, and gemstones.
Added value of trade and crafting
of gold/silver/gemstones equals (=) the selling price of gold, silver,
gemstones minus (-) the buying price of gold/silver/gemstones.
A business
establishment involved in trade, crafting of gold, silver or gemstones shall
keep separate accounting records on these activities separately to pay VAT
directly on added value.
2. Revenue-based
VAT equals (=) VAT rate (%) multiplied by (x) revenue. Application of
revenue-based VAT:
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a1) Enterprises,
cooperatives and cooperative unions with an annual revenue of less than 01
billion VND, except for those that voluntarily apply the credit-invoice method
prescribed in Clause 2 Article 11 of this Law;
a2) Household
businesses and individual businesses, except for the cases specified in Clause
3 of this Article;
a3) Foreign
organizations without permanent establishments in Vietnam, overseas
non-resident individuals that have revenue in Vietnam but have not fully
complied with accounting and invoicing regulations, except foreign suppliers
prescribed in Clause 4 Article 4 of this Law;
a4) Other
organizations, except for those applying the credit-invoice method prescribed
in Clause 2 Article 11 of this Law;
b) VAT rates:
b1) Goods supply
and distribution: 1%;
b2) Services and
construction without building materials: 5%;
b3) Production,
transport, services associated with goods, construction that covers building
materials: 3%;
b4) Other business
operations: 2%.”
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3. Household businesses and
individual businesses that do not or not fully comply with accounting and
invoicing regulations shall pay fixed VAT in accordance with the Law on Tax
Administration.
4. The Government
shall elaborate Clause 1 of this Article. The Minister of Finance shall specify
the groups of goods and services applying the VAT rates specified in Point b
Clause 2 of this Article.
Chapter III
VAT DEDUCTION AND REFUND
Article
13. Prohibited acts in VAT deduction and refund
1. Buying, giving, selling
invoices, advertising, brokering sales of invoices.
2. Creation of sales and purchase
of goods, provision of services that are not real or trading against the law.
3. Issuance of invoices for sale of
goods and services during business suspension, except issuance of invoices to
customers to execute contracts that are concluded before the date of
notification of business suspension.
4. Use of illegal invoices and
documents; illegal use of invoices and documents according to regulations of
the Government.
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6. Falsification, misuse, illegal
access, destruction of invoicing and documentation information systems.
7. Giving, taking, brokering bribes
or committing other invoice-related acts in order to be eligible for VAT
deduction, VAT refund, or to appropriate, evade VAT.
8. Aiding, harboring; arranging
collusion between tax officials, tax authorities and business establishments,
importers, between business establishments, importers in using illegal invoices
and documents, or illegal use of invoices and documents in order to be eligible
for VAT deduction, VAT refund, or to appropriate, evade VAT.
Article
14. Deduction of input VAT
1. Business
establishments that apply the credit-invoice method may deduct input VAT as
follows:
a) Input VAT on
goods and services used for the production and sale of goods and services
subject to VAT is fully deductible, including uncompensated input VAT on goods
and services subject to VAT that are damaged or lost during transport due to
their physical or chemical properties;
b) In case certain
goods/services are used for the production/trading of both goods/services
subject to VAT and goods/services not subject to VAT, only input VAT on the
goods/services used for the production/trading of the goods/services subject to
VAT is deductible. The business establishment shall separate deductible input
VAT and non-deductible input VAT on accounting records; if deductible input VAT
and non-deductible input VAT cannot be separately recorded, input VAT shall be
deducted according to ratio (%) of revenue from goods/services subject to VAT
to total revenue from goods/services sold;
c) Input VAT on
goods and services sold to organizations and individuals funded humanitarian
aid or grant aid is fully deductible;
d) Input VAT on
goods and services used for petroleum exploration and extraction is fully
deductible;
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If a business establishment finds
that input VAT was declared or deducted incorrectly, it may be rectified before
the tax authority or a competent authority issues a decision on tax audit or
tax inspection as follows:
In case of incorrect declaration of
input VAT of a month/quarter that leads to an increase in VAT payable or a
decrease in refundable VAT, the taxpayer shall make a supplementary declaration
in the month/quarter in which the incorrectly declared VAT is incurred; the
taxpayer shall pay the increase in VAT or return the excess VAT refund and pay
a late payment interest (if any) to state budget.
In case of incorrect declaration of
input VAT of a month/quarter that leads to a decrease in VAT payable or only an
increase or decrease in refundable VAT being carried forward to the next
month/quarter, the taxpayer shall make a declaration in the month/quarter in
which the error is found;
e) Business
establishments may aggregate non-deductible input VAT with expenses to
calculated corporate income tax, or with historical costs of fixed assets
according to regulations of law on corporate income tax, except VAT of goods
and services purchased without documentary evidence of cashless payment as per
regulations of the Government;
g) The Government
shall promulgate regulations on deduction of input VAT on goods and services forming
fixed asset serving employees; capital contribution by property; goods and
services purchased under authorization for with invoices bear the authorized
party’s name; fixed assets that are automobiles for the transport of up to 09
people; establishments having closed-loop manufacturing process and centralized
accounting.
2. Requirements
for deduction of input VAT deduction:
a) There are VAT
invoices for purchase of goods and services or documentary evidence of VAT
payment during import or documentary evidence of VAT payment on behalf of
foreign parties according to Clause 3 and Clause 4 Article 4 of this Law. The
Minister of Finance shall specify documentary evidence of VAT payment on behalf
of foreign parties;
b) There is
documentary evidence of cashless payment for goods and services purchased,
except in special cases specified by the Government;
c) For exported
goods and services, in addition to the requirements specified in Point a and
Point b of this Clause, there must also be a contract with the foreign party
for sale, processing of goods, provision of services; invoices for sale of
goods, provision of services; documentary evidence of cashless payment; customs
declarations for exports; packing list, bill of lading, goods insurance
documents (if any). The Government shall specify requirements for VAT deduction
in case of export of goods via overseas e-commerce platforms and some other
special cases.
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4. The Government
shall elaborate this Article.
Article
15. VAT refund
1. Refund of VAT
on exports:
a) In a month/quarter,
if residual input VAT credit on exported goods and services of a business
establishment is 300 million VND or more, it will be refunded by month/quarter,
unless the imports are then exported to another country;
b) In a
month/quarter, if a business establishment has both goods/services for export
and goods/services for domestic sale, input VAT for production/sale of the
goods/services for export must be separately recorded; Otherwise, input VAT on
goods/services for export will be determined according to ratio of revenue on
exported goods/services to total revenue from goods/services subject to VAT of
the tax refund period. Tax refund period is the period of time from the tax
period having the residual input VAT to the tax period in which VAT refund is claimed.
After input VAT on
exported goods/services (including separately recorded input VAT and input VAT
calculated according to the aforementioned ratio) is offset against VAT payable
on goods/services sold domestically, if the residual input VAT is 300 million
VND or more, the business establishment may claim a VAT refund for the exported
goods/services. The residual input VAT is refundable if it does not exceed 10%
of the revenue from the exported goods/services of the tax refund period. If
residual input VAT exceeds 10% of the revenue from the exported goods/services
in a tax refund period and is therefore not refundable, it will be deducted in
the next tax period in order to determine refundable VAT on the exported
goods/services of the next tax refund period.
2. Refund of VAT
on investments:
a) Business establishments that
have registered for application of the credit-invoice method and have
investment projects (new investment project or expansion investment projects)
as per investment laws (including investment projects that are divided into
multiple stages or items, except investment projects that do not form fixed
assets of enterprises) during the investment stage or petroleum exploration and
extraction projects during the investment stage, have incurred input VAT during
the investment stage and have not claimed VAT refunds may deduct such input VAT
from VAT payable from their ongoing business operations (if any). If the
residual input VAT on the investment projects is 300 million VND or more, it will
be refunded.
If the investment project has been
completed (including investment projects that are divided into multiple stages
or items with completed stages or items) but the business establishment has not
claimed refund of VAT incurred in the investment stage (on the completed stages
or items), the business establishment shall submit the VAT refund claim within
01 year from the completion date of the investment project, stage or item.
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b) Instead of receiving VAT refund,
a business establishment will have the residual VAT on the investment project
carried forward to the next period in the following cases:
b1) The investment project does not
have adequate charter capital as registered by the time of submission of the
VAT refund claim; engages in conditional business lines while the corresponding
conditions have not been fully satisfied as per investment laws or the
fulfillment of these conditions are not maintained throughout its operation,
except during the investment stage where, according to investment laws or
relevant laws, the license for operation in conditional business lines is not
yet required, or the investment project is not required to have the license for
operation in conditional business lines according to investment laws or
relevant laws;
b2) It is a natural resource or
mineral extraction project (excluding petroleum exploration and extraction
projects mentioned in Point a of this Clause) or investment project for
manufacture of products being natural resources or minerals that have been
processed into other products as prescribed in Clause 23 Article 5 of this Law.
3. A business
establishment that only manufactures products or provides services subject to
5% VAT and has a residual input VAT of 300 million VND or more for at least 12
consecutive months or 04 consecutive quarters will be eligible for VAT refund;
If the business establishment manufactures products or provides services
subject to different VAT rates, VAT shall be refunded at a ratio prescribed by
the Government.
4. Business establishments paying
VAT using the credit-invoice method will be eligible for VAT refund upon their
dissolution or bankruptcy if they have overpaid VAT or residual input VAT.
IN case an artel
applying the credit-invoice method is converted into a cooperative, the
cooperative will inherit all overpaid VAT or residual input VAT of the artel,
which can be used for deduction or claiming refund as per regulations.
5. Foreigners and
Vietnamese people residing abroad who have passports or international travel
documents papers shall receive refunds of VAT on goods purchased in Vietnam and
brought abroad.
The Government
shall specify documentation, procedures, refundable tax and refunding method
for the cases specified in this Clause.
6. Refund of VAT
for programs/projects funded by Official Development Assistance (ODA) grants,
grant aid or humanitarian aid:
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b) The
organizations in Vietnam that use grant aid or humanitarian aid provided by
foreign organizations and individuals to purchases goods and services to serve
the program/project funded by such grant aid or humanitarian aid will receive a
refund of VAT paid on such goods and services.
7. People eligible
for diplomatic immunity who purchases goods and services in Vietnam for personal
consumption will receive a refund of the VAT written on the VAT invoices or
payment documents having the VAT-inclusive prices.
8. Business
establishments having VAT refund decisions issued by competent authorities as
prescribed by law, and other cases eligible for VAT refund under treaties to
which the Socialist Republic of Vietnam is a signatory.
9. A business
establishment must satisfy the following requirements to receive VAT refund in
the cases specified in this Article:
a) The business establishment is
eligible for VAT refunds according to regulations of Clauses 1, 2, 3 and 4 of
this Article, pays VAT using the credit-invoice method, prepares and retains
accounting books and accounting records in accordance with accounting laws; has
checking accounts at banks under its taxpayer identification number (TIN);
b) Regulations on
deduction of input VAT in Clause 2 Article 14 are complied with and it is not
the case specified in Clause 3 Article 14 of this Law;
c) The seller has
declared and paid VAT under the invoices issued to the claiming business
establishment.
10. Taxpayers that
are eligible for VAT refund, have input VAT satisfying the VAT refund
requirements specified in this Article and fully comply with regulations on VAT
declaration shall prepare VAT refund claims for individual cases and send them
to competent tax authorities.
Tax authorities
shall categorize VAT refund claims as eligible for refund before inspection or
subject to inspection before refund, and processes these VAT refund claims in
accordance with regulations of law on tax administration.
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Article
16. Invoices and documents
1. Goods and
service purchase and sale must be accompanied by invoices and documents
according to the law and the following regulations:
a) Business
establishments that apply the credit-invoice method shall use VAT invoices. If
goods and services subject to VAT are sold but the VAT invoice does not specify
the VAT amount, output VAT shall be the amount payable written on the invoice
multiplied by (x) the VAT rate, except in the case specified in Clause 2 of
this Article;
b) Business
establishments that apply the direct method shall use sale invoices.
2. Prices pre-printed on stamps,
tickets and cards that are payment documents are inclusive of VAT.
Chapter IV
IMPLEMENTATION CLAUSES
Article 17.
Amendments to Clause 1 Article 3 of the Law on Personal Income Tax No.
04/2007/QH12, which is amended by Law No. 26/2012/QH13 and Law No. 71/2014/QH13
“1. Income from business,
including:
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b) Income from independent practice
of individuals having licenses or practicing certificates as prescribed by law.
Income from business mentioned in
this Clause does not include income of household businesses and individual
businesses whose revenues are below the level specified in Clause 25 Article 5
of the Law on Value-added Tax.”
Article 18.
Effect
1. This Law comes into force from
July 01, 2025, except in the cases specified in Clause 2 of this Article.
2. Regulations on revenues of
household businesses and individual businesses not subject to VAT at Clause 25
Article 5 of this Law and Article 17 of this Law come into force from January
01, 2026.
3. The Law on Value-added Tax No.
13/2008/QH12, which was amended by Law No. 31/2013/QH13, Law No. 71/2014/QH13
and Law No. 106/2016/QH13, is annulled from the effective date of this Law.
This Law was ratified by the 15th
National Assembly of the Socialist Republic of Vietnam during its 8thsession
on November 26, 2024.
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