Problem:
"If an individual travels for business, both domestically and internationally, and pays for expenses (including all expenses incurred during business trips as stipulated in the company's travel expense regulations, internal regulations, or financial regulations) exceeding 20 million VND using their personal credit card, are these considered non-cash payments? What documentation from the overseas party is required for tax purposes to be accepted?"
Answers:
In cases where a company sends employees on business trips abroad or domestically, if expenses exceed 20 million VND, payment by credit card of the employee is accepted as a non-cash payment method (payment by personal credit card is subject to Corporate Income Tax) and this expense will be deductible when determining taxable income if the following conditions are met:
1. Decision to send on business trip (business trip assignment document): Clearly state the officer being sent, the purpose, duration, and means of transportation.
2. A travel authorization form with confirmation from the sending company (departure date, return date) and the destination (arrival date, departure date) or confirmation from the guesthouse where the employee is staying.
3. Invoices and receipts related to travel: Invoices, airline tickets, boarding passes, train/bus tickets, hotel receipts, taxi receipts, etc. (If the amount exceeds 20 million VND, it must be transferred via bank transfer)
4. The conditions and amounts of entitlement are specifically stipulated in the financial regulations or internal regulations of the enterprise.
Conclusion: Individuals traveling abroad or domestically who pay for expenses (including all expenses incurred during business trips as stipulated in the company's travel expense regulations, internal regulations, or financial regulations, etc.) exceeding 20 million VND using their personal credit cards are considered to have made non-cash payments, as stated in the document below.
Download the official document: https://bitly.vn/2-do
How can I get tax authorities to accept documents from overseas when traveling for business?
1. Legal grounds
Article 4 of Circular 96/2015/TT-BTC
Clause 4, Article 5 of Circular 156/2013/TT-BTC
Official document No. 21535/CT-TTHT, dated April 20, 2018
In cases where a business sends employees abroad for production or business purposes, and incurs travel and accommodation expenses overseas, and according to the company's regulations, the company reimburses the employee for all these expenses based on invoices and supporting documents brought back by the employee, then these expenses are deductible expenses if all invoices and supporting documents are available, as per Article 4 of Circular 96/2015/TT-BTC.
2. What types of documents are considered valid and deductible when accounting for corporate income tax expenses?
* If expenses of 20 million VND or more are incurred, including airfare, and these expenses are paid using a personal bank card, this qualifies as a non-cash payment method and is deductible if the following conditions are met:
- Have appropriate invoices and documents delivered by the goods or service provider.
- The enterprise has a decision or a document to send workers to work.
- Financial regulations or internal regulations of the enterprise allow employees to pay travel expenses and air tickets with a bank card by the individual who is the cardholder and these expenses are then paid by the enterprise. pay back to the employee.
* In cases where a business purchases airline tickets through an e-commerce website for employees traveling on business for the purpose of production and business activities, the documents used as a basis for calculating deductible expenses are the electronic airline ticket, boarding pass, and non-cash payment documents from the business with the individual participating in the transportation. If the business cannot retrieve the employee's boarding pass, the documents used as a basis for calculating deductible expenses are the electronic airline ticket, the decision or document assigning the employee to the business trip, and non-cash payment documents from the business with the individual participating in the transportation.
* For expenses incurred abroad, invoices and supporting documents for these expenses must comply with the regulations of the host country and must be translated into Vietnamese according to the guidelines in Circular 156/2013/TT-BTC. The taxpayer must sign and stamp the translation and is legally responsible for the accuracy of the translation.
* In cases where foreign-language documents exceed 20 A4 pages in total, the taxpayer must submit a written explanation and request that only the content and clauses relevant to determining tax obligations be translated.
