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OPEN LETTER ON PEOPLE AND ENTERPRISE SUPPORT TAX POLICIES IN SOCIO-ECONOMIC RECOVERY AND DEVELOPMENT SENT TO THE TAXPAYERS

Trường Lăng

June 7, 2022

News

OPEN LETTER ON PEOPLE AND ENTERPRISE SUPPORT TAX POLICIES IN SOCIO-ECONOMIC RECOVERY AND DEVELOPMENT SENT TO THE TAXPAYERS

Trường Lăng

June 7, 2022

Hanoi Department of Taxation would like to send its respectful greetings and thanks for the cooperation and companionship of organizations and enterprises (hereinafter referred to as the taxpayers) in the implementation of tax regulations over the past time.

quan ly thue qoc

On January 11, 2022, the National Assembly Standing Committee issued the Resolution No. 43/2022/QH15 on fiscal and monetary policies to support the program of socio-economic recovery and development. On January 28, 2022, the Government issued the Decree No. 15/2022/ND-CP stipulating tax exemption and reduction policies under the Resolution No. 43/2022/QH15 of the National Assembly, effective from February 1, 2022.

Hanoi Department of Taxation would like to provide the taxpayers with the note about the tax exemption and reduction policies specified in the Decree No. 15/2022/ND-CP as follows:

I. Value-added tax reduction policy:

1. Subjects of application: group of goods and services currently applying the value-added tax rate of 10%, except for the group of goods and services specified in Appendices I, II, III issued together with the Decree No. 15/2022/ND-CP.

2. Reduction rate: Reducing 2% of value added tax rate in 2022 (to 8%) for the above groups of goods and services.

3. Executed sequence and procedures:

– For Business entities whose VAT applied by the reduction method: When VAT invoices providing goods and services subject to value-added tax reduction is prepared, write “8%” at the value-added tax rate line; value added tax amount; the total amount to be paid by the buyer. Based on the value-added invoice, the seller and the buyer declare tax as prescribed.

– For Business entities (including business households and individuals) calculating VAT according to the percentage method on turnover, when preparing sales invoices for the provision of goods and services subject to VAT reduction in the column “Amount” write the full amount of goods and services before the reduction, in the line “Sum up the sum for goods and services” write the amount that has reduced 20% of the percentage of revenue, and remark: “reduced… (amount) equivalent to 20% of the percentage rate for calculating value-added tax according to the Resolution No. 43/2022/QH15”.

– Business entities shall declare value-added tax-reduced goods and services according to Form No. 01 in Appendix IV issued together with the Decree No. 15/2022/ND-CP together with the value-added tax declaration.

– When selling goods and services, the taxpayers must prepare specific invoices for goods and services eligible for value-added tax reduction. In case Business entities do not issue specific invoices for goods and services eligible for value-added tax reduction, they are not entitled to value-added tax reduction.

– The value-added tax reduction for each type of goods and services specified in Clause 1 of this Article is uniformly applied at the stages of importation, production, processing, business and trade.

– In case a Business entity has issued an invoice and declared at the tax rate or percentage to calculate the value-added tax that has not yet been reduced as prescribed in the Decree No. 15/2022/ND-CP, the seller and the buyer must make a record or have a written agreement clearly stating the error, and at the same time the seller shall issue an invoice to correct the error and deliver the adjusted invoice to the buyer. Based on the adjusted invoice, the two parties declare tax as prescribed.

– For goods sold/services of which provision has been completed before February 1, 2022, the tax rate of 8% is not applicable (including the case that the taxpayers will not be able to issue the invoice until February 2022 for goods and services sold/provided before February 1, 2022)

– For invoices prepared before February 1, 2022, but errors found since February 1, 2022, the taxpayers who prepare adjusted/replaced invoices will still apply the tax rate at the time of sale of goods or services as goods and services are sold/provided before February 1, 2022.

– For Business entities that issue invoices at the wrong tax rate but the taxpayers do not make adjustment/replacement invoices, when the tax authorities inspect and detect, they will handle according to regulations.

II. Enterprises and organizations are CIT payers according to the provisions of the Law on Corporate Income Tax, shall be included in the deductible expenses when determining the taxable income of the corporate income tax period of 2022, for the donation or sponsorship expenses in cash and in kind for Covid-19 epidemic prevention and control activities in Vietnam through the donation and sponsorship recipients specified in Clause 2, Article 2 of the Decree No. No. 15/2022/ND-CP.

The documents to determine expenditures for donation or sponsorship consist of: Minutes of confirmation of support or sponsorship, made according to Form No. 02 in Appendix IV issued together with the Decree No. 15/2022/ND-CP or documents and financial statements (in paper or electronic form) certifying the expenditure of support, sponsorship, signed and stamped by the representatives of the enterprises or organizations that are the supporters, sponsors and the representative of the support , sponsor recipients; accompanied by legal invoices and vouchers as prescribed by the law of donation or sponsorship in cash or in kind.

Remarks:

+ In case the parent company receives donation or sponsorship from affiliates to focus on donation or sponsorship activities, the parent company and affiliates are included in the deductible expenses unless the taxable income corresponding to the donation or sponsorship of the parent company and each affiliate is otherwise determined. The parent company must have a record or a document certifying the expenditure of donation or sponsorship mentioned in Clause 4, Article 2 of the Decree No. 15/2022/ND-CP. The affiliate must have legal invoices and documents in accordance with the law and have a written certification of the parent company about the donation or sponsorship of each affiliate.

+ The ones receiving donations and sponsorships are responsible for using and distributing the right purposes of the received donations and sponsorships for Covid-19 prevention and control activities. In case the donation or sponsorship recipients misuse the donation or sponsorship for the wrong purpose, they will be handled in accordance with the law.

During the implementation process, if there are any problems, the taxpayers should contact Hanoi Department of Taxation/directly managing Department of Taxation for guidance.

The taxpayers can visit the website of Hanoi Department of Taxation (http://hanoi.gdt.gov.vn) to find understanding and update supporting information from Hanoi Department of Taxation.

Source :Letter from the Hanoi city Department of Taxation

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