Question:
In the case where the Seller has issued an electronic invoice and sent it to the Buyer (the Buyer has declared taxes as required). Later, the Seller unilaterally cancels the invoice without notifying the Buyer. In this case:
1. How should the Buyer handle the input invoice that the Seller canceled unilaterally, even though the Buyer declared taxes correctly?
2. Does the Buyer have to adjust the VAT return due to the Seller’s mistake in canceling the invoice?
3. What actions can the tax authority take against the Seller in this case to minimize the risk for the Buyer? Because when the Seller unilaterally cancels the invoice without notifying the Buyer, all risks fall on the Buyer. It seems quite unreasonable?
Answer:
Based on Article d, Clause 3, Article 27 of Decree No. 125/2020/NĐ-CP dated October 19, 2020, of the Government, which regulates administrative sanctions on tax and invoice violations, penalties are imposed for the act of canceling or destroying invoices not in accordance with the legal procedures and regulations.
Based on Article 9 of Circular No. 32/2011/TT-BTC dated March 14, 2011, guiding the creation, issuance, use, and management of electronic invoices for selling goods and supplying services, it stipulates the handling of invoices that have been issued.
Based on the above regulations:
• In principle, if an electronic invoice has been issued and sent to the buyer but the goods or services have not been delivered, or the electronic invoice has been issued and sent to the buyer, and neither the seller nor the buyer has declared taxes, it can only be canceled with the agreement and confirmation of both the seller and the buyer. The cancellation of electronic invoices must be effective within the agreed-upon time by the parties involved. Canceled electronic invoices must be archived for the convenience of inquiries by competent state authorities. The seller shall issue a new electronic invoice in accordance with this Circular to send to the buyer, and the new electronic invoice must contain the line: ‘This invoice replaces invoice No…, series…, issued on…’.
• In the case where the seller has issued an electronic invoice and sent it to the buyer (the buyer has declared taxes as required). Later, if the seller unilaterally cancels the invoice without notifying the buyer, the seller will be subject to penalties according to Article d, Clause 3 of Decree No. 125/2020/NĐ-CP. Additionally, the buyer must declare and adjust the reduced amount of input VAT already deducted, which cannot be included in deductible expenses when determining taxable income.
Question:
Currently, our company uses foreign accounting software. In this software, the names, addresses of purchasing units, names of goods and services on invoices are written in unaccented Vietnamese, and it applies the way of writing numbers used by foreigners, using a comma as a natural number separator after thousands, millions, billions, trillions, quadrillions, and a dot after the unit digit on invoices and accounting documents. At the beginning of December 2020, some customers, after receiving our invoices, requested that we provide them with a tax authority’s approval letter regarding the use of unaccented Vietnamese for the invoices to be valid. Do we need to submit a letter requesting permission to use unaccented Vietnamese on invoices?
Answer:
Based on Article 1, Clause 3, Article 3 of Circular No. 26/2015/TT-BTC dated February 27, 2015, of the Ministry of Finance guiding value-added tax (VAT), tax administration, and invoices for the sale of goods, supply of services, amended and supplemented by Point d, Clause 1, Article 4 of Circular No. 39/2014/TT-BTC dated March 31, 2014, guiding the implementation of Decree No. 51/2010/NĐ-CP dated May 14, 2010, and Decree No. 04/2014/NĐ-CP dated January 17, 2014 of the Government on invoices for the sale of goods and supply of services: In the case where the company uses foreign accounting software, and the names on invoices are written in unaccented Vietnamese, and numbers are written with a comma as a natural number separator after thousands, millions, billions, etc., and a dot after the unit digit, the company does not need to register the use of unaccented Vietnamese with the tax authorities. However, unaccented Vietnamese characters on invoices must ensure that they do not lead to misunderstandings regarding the content of the invoice.
Question:
Please provide information about electronic invoices applicable from November 1, 2020. Currently, our company is using commercial invoices for processing exported goods. Will our company continue to use commercial invoices (IVOICE) until November 1, 2020, or is it mandatory to switch to electronic invoices?
Answer:
According to the regulations of Law on Tax Administration No. 38/2019/QH14 dated June 13, 2020, of the 14th National Assembly, starting from July 1, 2022, all businesses must use electronic invoices and documents when selling goods and providing services to customers. Before July 1, 2022, it is encouraged for government agencies, organizations, and individuals to apply electronic invoice and document regulations. Therefore, if your business is currently using commercial invoices for processing exported goods, your business can continue to use them until the tax authority notifies your business to switch to electronic invoices.
Question:
Circular No. 68/2019/TT-BTC dated September 30, 2019, provides guidance on implementing some provisions of Decree No. 119/2018/NĐ-CP dated September 12, 2018, of the Government regarding electronic invoices for selling goods and providing services, and it has been in effect since November 14, 2019. Meanwhile, Circular No. 32/2011/TT-BTC dated March 14, 2011, of the Ministry of Finance, which guides the creation, issuance, and use of electronic invoices for selling goods and providing services, continues to be in effect until October 31, 2020. Both circulars have content related to the creation, issuance, and use of electronic invoices, but they differ in terms of form number, invoice symbols, invoice numbers, seller’s electronic signature, electronic invoice usage registration, and handling of invoice errors, leading to difficulties in choosing which regulation to follow when issuing invoices. Now, we kindly request the Tax Department of Ho Chi Minh City – Propaganda Office to support and clarify the following question for our company: At this time, if our company issues electronic invoices, should our company use the invoice form according to Circular No. 32/2011/TT-BTC or Circular No. 68/2019/TT-BTC to avoid the need for time-consuming and costly software conversion?
Answer:
Based on Article 27 of Circular No. 68/2019/TT-BTC dated September 30, 2019, of the Ministry of Finance, providing guidance on implementing some provisions of Decree No. 119/2018/NĐ-CP dated September 12, 2018, of the Government regarding electronic invoices for selling goods and providing services, during the period from November 1, 2018, to October 31, 2020, businesses shall continue to apply the invoice regulations stipulated in Decree No. 51/2010/NĐ-CP dated May 14, 2010, and Decree No. 04/2014/NĐ-CP dated January 17, 2014, and other guiding documents.
Therefore, at present, businesses using electronic invoices, before using them, need to make a decision to apply electronic invoices according to Form 1 in the Appendix issued together with Circular No. 32/2011/TT-BTC and simultaneously make a notification of issuing electronic invoices according to Form TB01/AC issued together with Circular No. 26/2015/TT-BTC of the Ministry of Finance to send to the tax authority directly managing the business.
Regarding the content of electronic invoices, creating and using electronic invoices, businesses must comply with the regulations of Circular No. 32/2011/TT-BTC of the Ministry of Finance.
