Ho Chi Minh City Tax Department provides guidance on the cost of printing calendars for gifting.

The cost of printing calendars to give as gifts to customers and partners must be invoiced and VAT calculated as if it were a sale of goods. If there is a valid invoice (invoices for purchases valued at 20 million VND or more must have non-cash payment documentation), the printing cost is deductible when determining taxable corporate income.

View the official document here.

Dear: Construction Equipment and Supplies Joint Stock Company 624
Address: 01 Hoang Hoa Tham Street, Ward 6, Binh Thanh District, Ho Chi Minh City
MST 0300479048

In response to document No. 197/TCKT dated November 23, 2016, from the Company regarding tax policy, the City Tax Department has the following opinion:

Based on Clause 3, Article 7 of Circular No. 219/2013/TT-BTC dated December 31, 2013, issued by the Ministry of Finance, guiding value-added tax (VAT), the VAT taxable value is stipulated as follows:

"For products, goods, and services (including those purchased from outside or produced by the business itself) used for exchange, gifts, donations, or as payment in lieu of salary, the VAT taxable price is the price of similar or equivalent goods and services at the time these activities occur."

... "

Based on Clause 7, Article 3 of Circular No. 26/2015/TT-BTC dated February 27, 2015 of the Ministry of Finance amending and supplementing Point b, Clause 1, Article 16 of Circular No. 39/2014/TT-BTC (which has been amended and supplemented by Clause 3, Article 5 of Circular No. 119/2014/TT-BTC) as follows:

“b) Sellers must issue invoices when selling goods and services, including in cases where goods and services are used for promotions, advertising, samples; goods and services used for giving, gifting, exchanging, or as payment in lieu of wages for employees (except for goods circulated internally or consumed internally to continue the production process).

... "

Based on Article 4 of Circular No. 96/2015/TT-BTC dated June 22, 2015, of the Ministry of Finance, amending and supplementing Article 6 of Circular No. 78/2014/TT-BTC (which has been amended and supplemented by Clause 2, Article 6 of Circular No. 119/2014/TT-BTC and Article 1 of Circular No. 151/2014/TT-BTC) regarding deductible and non-deductible expenses when determining taxable corporate income:

"Deductible and non-deductible expenses when determining taxable income"

1. Except for the non-deductible expenses specified in Clause 2 of this Article, enterprises are allowed to deduct all expenses if they meet the following conditions:

a) Actual expenses incurred in connection with the business operations of the enterprise.

b) The expenditure is supported by valid invoices and documents as required by law.

c) For expenditures with invoices for goods and services valued at 20 million VND or more (including VAT), payment must be made using non-cash methods.

... "

Based on the regulations mentioned above, if the Company, as stated, printed calendars to give to customers and partners in 2015 and 2016, the cost of printing these calendars must be invoiced and VAT calculated as if it were a sale of goods. If the printing cost is supported by legitimate invoices (invoices for purchases valued at 20 million VND or more must have non-cash payment documentation), then it can be deducted when determining taxable corporate income.

The City Tax Department hereby informs the Company to comply with the regulations stipulated in the legal documents cited in this document.