The General Department of Taxation received several feedbacks regarding difficulties related to invoice issuance when implementing Decree 15/2022/ND-CP. Therefore, on May 29, 2023, the General Department of Taxation issued Official Letter 2121/TCT-CS to provide guidance on issuing invoices with a 2% VAT reduction in certain cases as stipulated.
1. Which invoices are eligible for the 2% tax reduction in 2023?
On March 23, 2022, the Ministry of Finance issued Official Letter 2688/BTC-TCT directing and guiding the Tax Departments of provinces and cities to implement regulations on VAT according to Decree 15/2022/ND-CP, including guidance on the timing of invoice issuance.
On September 22, 2022, the General Department of Taxation issued Official Letter 3522/TCT-CS in response to the Ho Chi Minh City Tax Department and sent it to the Tax Departments of provinces and cities, providing guidance on VAT reduction for cases with specific invoice issuance dates. Accordingly, the Tax Departments of provinces and centrally-administered cities are requested to study the content and guide their units in implementing the guidance from the Ministry of Finance and the General Department of Taxation mentioned above.
2. Regarding cases for issuing invoices
According to Official Letter 2122/TCT-CS, the General Department of Taxation provides guidance on invoice issuance in specific cases as follows:
2.1. Case where invoices are reissued in 2023 due to errors in 2022
In cases where goods or services are eligible for a 2% VAT reduction under Decree 15/2022/ND-CP, if errors are discovered after December 31, 2022, an adjusted or replacement invoice must be issued.
- Adjustment or replacement invoices are subject to an 8% VAT rate if the error does not affect the amount of goods and the VAT payable, or if the taxable price is adjusted.
- Adjustment or replacement invoices are subject to a 10% VAT rate if an error in the quantity of goods leads to an error in the amount of goods and VAT.
2.2. Cases where invoices are reissued due to the buyer returning goods.
For goods sold before January 1, 2023, and invoiced with an 8% VAT rate, if the buyer returns the goods after December 31, 2022, due to incorrect specifications or quality, the seller must issue a return invoice to adjust or replace the previously issued invoice with a reduced VAT rate of 2%. A clear agreement between the seller and the buyer regarding the returned goods is required.
2.3. Cases where invoices include trade discounts for goods sold in 2022
If a business applies trade discounts to customers, and for goods subject to a VAT reduction of 8% that were sold in 2022 but invoices showing the trade discounts were only issued from January 1, 2023 onwards, then:
- The discount amount for goods sold is adjusted in the tax base price, with a tax rate of 10%, if the discount amount is applied to the last purchase or the period following December 31, 2022;
- The seller shall issue an adjusted invoice and apply the 8% VAT rate at the time of sale if the discount amount was determined at the end of the discount program after December 31, 2022.
2.4. Cases where sales took place in 2022 but invoices were issued in 2023
Revenue of businesses selling goods, providing services (subject to VAT reduction under Decree 15/2022/ND-CP) and construction and installation activities with the time of acceptance and handover of the project, project item, or completed construction and installation volume, regardless of whether payment has been received or not, arising during the VAT reduction period (from February 1, 2022 to December 31, 2022) but with invoices issued after December 31, 2022, shall be subject to the following:
- That invoice was issued at the wrong time, but it was still subject to the 8% VAT rate according to Decree 15/2022/ND-CP;
- Received administrative penalties for issuing invoices at the wrong time.
3. Principles for creating, managing, and using invoices
The principles for the creation, management, and use of invoices and documents, as stipulated in Article 4 of Decree 123/2020/ND-CP, have been clarified in detail in the following article: Note regarding invoice usage