TAX UPDATE ON LATEST DRAFT DECREE ON ELECTRONIC INVOICING

Recently, there has been a submission of the 4th version of the draft decree on electronic invoicing to the Prime nester. After being taken into accounts of Government members’ comments, the draft decree is now waiting for review. According to the new Decree, electronic invoice will be made compulsory for the majority of taxpayers. Its effect is supposed to be after 45 days from the date of signing. Moreover, there would a transition period of 2 ears from the effective that the Decree applies.

Accordingly, electronic invoices without verification code of the tax authorities are applied for organizations operating in some specific industries such as e-commerce, supermarket, insurance, transportation, electricity, telecommunication, trading etc… and all other enterprises falling into these categories:

Already had transaction of will have transaction with the tax authorities in electronic ways.

Are regulated to maintain technology infrastructure, e-invoice software, accounting software.

Otherwise, all economic organizations and enterprises not belonging to these above categories or high risk organizations are require to use e-invoices with verification code of the tax authorities.

Approval from tax authorities must be registered and obtained via the General Department of Taxation (GDT)’s website.

The sellers can issue and sign electronic invoices digitally via the system of e-invoicing provided by e-invoice solution agencies.  The web portal of the GDT is the legal platform to issue and sign e-invoice with verification code. The electronic method that the sellers send e-invoices to the byers should be agree by the two parties.

The minimum amount of 200,000 VND for purchase value was previously requested for issuing e-invoices (which is similar to normal paper invoices). However, no specific amount is mentioned on the new draft decree governing e-invoicing.

According to the Law on Accounting, it is possible to convert e invoices into paper form with the aim to monitor and record. However, the converted to paper invoices are unacceptable to execute transactions or make payment.

Regarding the goods in transit, detailed information guiding e-invoices can be found in the GDT’s web portal. In this case, it is not present papers invoices.

Other information concerning the transition period:

Before the effective date of the Decree, organizations which have already used e-invoice regardless of the verification date will continue to keep up with the current e-invoices from the date the new Decree takes effect.

Before the effective date of the Decree, organizations which have used other types of invoice such as self-printed invoices, purchased invoices from the tax authorities, pre-printed invoices will be possible to continue with the current invoices usage within 2 years (24 months) from the date the new Decree takes effect.

For public organization including clinics, hospitals, schools, universities…, it is allowed to continue using receipts while preparing to switch to e-invoices/ e-receipts under the guided timeframe issued by the Ministry of Finance.

Electronic invoicing can result in a wide range of long-term benefits for organizations. However, many business owners are still confused about how to implement e-invoices in daily activities. If you find yourself in this case, contact S4B Vietnam for the best update and guidance on e-invoices usage and management.