Circular 173/2016/TT-BTC amends the regulations on the conditions for deducting input value-added tax (VAT) in Clause 3, Article 15 of Circular 219/2013/TT-BTC, issued on October 28, 2016.
Accordingly, the regulation requiring both the buyer's and seller's accounts to be registered or notified to the tax authorities has been removed.
Therefore, even without notifying or registering the account with the tax authorities, payment documents between two accounts opened at the payment service provider are still a condition for the entity to be eligible for input VAT deduction.
Furthermore, according to this new regulation, it is no longer necessary to register a trading account with the tax authorities before making payments.
+ From the buyer's account to the seller's account in the name of the private business owner; or
+ Transfer from the buyer's account, registered under the name of the private business owner, to the seller's account.
Circular 173/2016/TT-BTC came into effect on December 15, 2016.
Comparison between the new circular (2016) and the old circular (2013) on conditions for VAT deduction.
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Circular 173 / 2016 / TT-BTC (new amendments and additions) |
Circular No. 219 / 2013 / TT-BTC (Previously amended by Circular No. 26/2015/TT-BTC dated February 27, 2015) |
| 3. Bank payment documents are understood as documents proving the transfer of funds from the buyer's account to the seller's account opened at payment service providers using payment methods compliant with current laws, such as checks, payment orders, collection orders, bank cards, credit cards, mobile phone SIM cards (electronic wallets), and other prescribed payment methods (including cases where the buyer pays from their account to the seller's account in the name of the owner of a private enterprise, or the buyer pays from their account in the name of the owner of a private enterprise to the seller's account). | 3. Bank payment documents are understood to be documents proving the transfer of funds from the buyer's account to the seller's account. (Both the buyer's and seller's accounts must be registered or notified to the tax authorities. The buyer does not need to register or notify the tax authorities of any loan accounts at credit institutions used to pay the supplier.) Opened at payment service providers using payment methods compliant with current laws, such as checks, payment orders or disbursement orders, collection orders, collection services, bank cards, credit cards, mobile phone SIM cards (electronic wallets), and other prescribed payment methods (including cases where the buyer pays from the buyer's account to the seller's account in the name of the private business owner, or the buyer pays from the buyer's account in the name of the private business owner to the seller's account). if this account has already been registered for transactions with the tax authorities.). |
