investment project and must transfer input VAT of the investment project to offset with VAT declaration of ongoing production and business activities. The maximum amount of VAT transferred of the investment project is equal to the amount of VAT payable of the production and business activities of the business establishment during the period.
After offset, if the input VAT amount of the investment project that has not been fully deducted is from 300 million VND or more, the VAT for the investment project will be refunded.
After offset, if the input VAT amount of the investment project that has not been fully deducted is less than 300 million VND, it will be transferred to the input VAT amount of the investment project of the next declaration period.
In case during the declaration period, the business establishment has input VAT of production and business activities that have not been fully deducted and input VAT of the investment project, the business establishment will be refunded according to the instructions in Clause 1 and Clause 3 of this Article as prescribed.
- In case an operating business establishment subject to VAT payment under the deduction method has a new investment project (except for investment projects to build houses for sale) in a province or centrally-run city other than the province or city where its head office is located, which is in the investment stage and has not yet come into operation, has not yet registered for business, and has not yet registered for tax, the business establishment shall prepare a separate tax declaration for the investment project and at the same time must transfer the input VAT of the investment project to offset the VAT declaration of the ongoing production and business activities. The maximum amount of VAT transferred of the investment project is equal to the VAT payable of the production and business activities of the business establishment during the period.
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After offset, if the input VAT of the new investment project has not been fully deducted from 300 million VND or more, the VAT for the investment project will be refunded.
After offset, if the input VAT amount of the new investment project that has not been fully deducted is less than 300 million VND, it will be transferred to the input VAT amount of the investment project of the next declaration period.
In case a business establishment has a decision to establish Project Management Boards or branches located in provinces or centrally run cities other than the province or city where the head office is located to directly manage one or more investment projects in many localities on behalf of the taxpayer; the Project Management Board or branch has a seal according to the provisions of law , keeps books and documents according to the provisions of law on accounting, has a deposit account at a bank, has registered for tax and is granted a tax code, the Project Management Board or branch must prepare separate tax declaration and refund dossiers with the local tax authority where the tax is registered. When the investment project to establish the enterprise is completed
and complete the procedures for business registration and tax registration, the business establishment that is the owner of the investment project must summarize the value added tax incurred, the value added tax refunded, the value added tax not yet refunded of the project to hand over to the newly established enterprise so that the new enterprise can declare, pay tax and request a value added tax refund according to regulations with the direct tax authority.
Investment projects eligible for VAT refunds under the above provisions are investment projects approved by competent authorities in accordance with the provisions of the law on investment. In cases where an investment project is not subject to approval under the provisions of the law on investment, it must have an investment plan approved by the person with the authority to issue the investment decision.
Fourth, Business establishments that export goods and services in a month (in case of monthly declaration) or quarter (in case of quarterly declaration) and whose input VAT on exported goods and services has not been deducted is from VND 300 million or more will be refunded the monthly or quarterly VAT; if in a month or quarter the input VAT on exported goods and services has not been deducted is less than VND 300 million, it will be deducted in the following month or quarter.
In a month/quarter, a business establishment that has both exported goods and services and domestically sold goods and services will be refunded VAT on exported goods and services if the input VAT amount of exported goods and services that has not been fully deducted is VND 300 million or more.
The input VAT amount to be refunded for exported goods and services is determined.
defined as follows:
Undeducted VAT amount of the month
/quarter
Output VAT
= of goods and services sold domestically
Total input VAT deductible in the month/quarter (including: input VAT for export activities,
_
taxable domestic business activities
in the month/quarter and VAT not fully deducted from the previous month/quarter)
Input VAT of exported goods and services
VAT not deducted
=
end of
month/quarter
Total export revenue in month/quarter
x Total revenue from taxable goods and services sold during the period, revenue not required to be declared or taxed (including export revenue)
export) in month/quarter
x 100%
If the input VAT amount of exported goods and services that has been allocated as above and has not been deducted is less than 300 million VND, the business establishment will not be considered for a monthly/quarterly tax refund but will be carried forward to the next tax period; if the input VAT amount of exported goods and services that has not been deducted is 300 million VND or more, the business establishment will be entitled to a monthly/quarterly VAT refund.
Fifth, business establishments that pay value added tax according to the tax deduction method are entitled to a value added tax refund when changing ownership, converting enterprises, merging, consolidating, dividing, separating, dissolving, going bankrupt, or ceasing operations and have excess value added tax paid or input value added tax that has not been fully deducted.
A business establishment in the investment phase that has not yet entered production and business operations but must be dissolved, declared bankrupt or cease operations and has not yet generated output value-added tax from its main business activities according to the investment project is not required to adjust the declared, deducted or refunded value-added tax amount. The business establishment must notify the directly managing tax authority of its dissolution, bankruptcy or cessation of operations in accordance with regulations.
In case the business establishment has completed all procedures according to the provisions of law on dissolution and bankruptcy, the refunded VAT amount shall be implemented according to the provisions of law on dissolution, bankruptcy and tax management; the refund of unrefundable VAT amount shall not be resolved.
In case a business establishment ceases operations and does not incur output VAT on its main business activities, it must return the refunded tax to the state budget. In case of sale of assets subject to VAT, it is not necessary to adjust the corresponding input VAT on the assets sold.
Sixth , VAT refund for programs and projects using non-refundable official development assistance (ODA) capital or non-refundable aid, humanitarian aid
- For projects using non-refundable ODA capital: the program or project owner or the main contractor or organization designated by the foreign sponsor to manage the program or project will be refunded the VAT paid on goods and services purchased in Vietnam for use in the program or project.
- Organizations in Vietnam that use humanitarian aid money from foreign organizations and individuals to purchase goods and services for non-refundable aid and humanitarian aid programs and projects in Vietnam will be refunded the VAT paid on those goods and services.
For example : The Red Cross received 200 million VND in aid from an international organization to purchase humanitarian aid for people in provinces affected by natural disasters. The value of the purchased goods is not yet available.
Tax is 200 million VND, VAT is 20 million VND. Red Cross will be refunded tax according to regulations of 20 million VND.
Refunds of VAT paid for programs and projects using non-refundable official development assistance (ODA) funds are implemented according to the guidance of the Ministry of Finance.
Seventh , subjects enjoying diplomatic immunity and privileges according to the provisions of the law on diplomatic immunity and privileges purchasing goods and services in Vietnam for use will be refunded the value added tax paid as stated on the value added tax invoice or on the payment document stating the payment price including value added tax.
Eighth, foreigners and Vietnamese people residing abroad holding passports or entry papers issued by competent foreign authorities are entitled to a VAT refund for goods purchased in Vietnam and brought with them when leaving the country. VAT refunds are implemented in accordance with the Ministry of Finance's guidance on VAT refunds for goods purchased in Vietnam by foreigners and Vietnamese people residing abroad and brought with them when leaving the country.
Ninth , the business establishment has a decision to handle tax refunds from a competent authority in accordance with the provisions of law and in the case of value-added tax refunds under international treaties of which the Socialist Republic of Vietnam is a member.
REVIEW CONTENT
I. THEORY OF ESSAY QUESTIONS
1. Present the concept and purpose of applying value added tax.
2. State the conditions for applying value added tax calculation according to the deduction method and write the formula to determine value added tax payable according to the deduction method.
3. How many methods are there to calculate VAT? Conditions of application?
4. Distinguish between cases not subject to VAT and cases subject to VAT at a tax rate of 0%.
5. According to current regulations, in which cases is VAT refunded?
6. Present current regulations on VAT calculation prices in the following cases: asset leasing, installment sales, construction and installation, transportation, loading and unloading, processing, agency sales, goods and services using special invoices.
7. List the cases not subject to VAT.
TRUE OR FALSE QUESTIONS
Please choose true or false and explain.
1. Exported goods are not subject to VAT.
2. VAT is not levied on import activities if the import activities result in losses.
3. All businesses that use complete invoices and documents are allowed to pay taxes using the tax deduction method.
4. The 0% VAT rate is applied to goods that the State encourages consumption.
5. All exported goods are subject to a VAT rate of 0%.
6. Business establishments are entitled to a tax refund when the output VAT amount is less than the output VAT amount.
7. Goods purchased and sold in duty-free zones that generate VAT are subject to VAT.
8. The price for calculating VAT on imported goods is the import price.
9. All cases of supplying goods to enterprises in export processing zones enjoy a 0% tax rate.
10. VAT is an indirect tax.
MULTIPLE CHOICE QUESTIONS
Please choose the correct answer.
Question 1. Which of the following is not a characteristic of value added tax (VAT)?
A. Indirect
B. Multi-stage tax calculation
C. Overlapping
D. Highly neutral
Question 2. The subjects subject to value added tax (VAT) are:
A. Goods and services produced and traded in Vietnam
B. Goods and services purchased from organizations and individuals abroad
C. Goods and services used for production, business and consumption in Vietnam (including goods and services purchased from organizations and individuals abroad), except for those not subject to VAT.
D. All of the above
Question 3. For goods and services used for internal exchange and consumption, the price for calculating value added tax (VAT) is
A. Selling price does not include VAT
B. Selling price includes VAT
C. Taxable price of goods and services of the same type
D. Taxable price of goods and services of the same or equivalent type at the time of internal exchange and consumption
Question 4. For goods circulated internally to continue the production and business process, the price for calculating value added tax (VAT) is
A. No need to calculate and pay VAT
B. Selling price does not include VAT
C. Selling price includes VAT
D. Taxable price of goods and services of the same or equivalent type at the time these activities occur
Question 5. Internal circulation goods are goods
A. Sold by business establishments
B. Provided by the business establishment for the business establishment's consumption
C. To continue the production process in a manufacturing or business establishment
D. Donated or donated by business establishments
Question 6. The price for calculating value added tax (VAT) on imported goods is
A. Price does not include VAT
B. Price does not include VAT, includes special consumption tax
C. Price does not include VAT, includes import tax
D. Import price at the border gate plus import tax (if any), plus special consumption tax (if any).
Question 7. The 0% tax rate does not apply to
A. Export goods
B. Export services
C. International transport
D. Cars sold to organizations and individuals in duty-free zones
Question 8. The amount of value added tax (VAT) payable under the tax deduction method is determined by
A. Output VAT minus deductible input VAT
B. Total output VAT
C. VAT of taxable goods and services sold multiplied by the VAT rate of that type of goods and services
D. Output VAT minus input VAT
Question 9. The tax deduction method applies to which of the following subjects?
A. Individuals and business households do not implement or do not fully implement the regime.
accounting, invoices, documents according to the provisions of law.
B. Foreign organizations and individuals doing business not in accordance with the Investment Law and other organizations that do not implement or do not fully implement the accounting, invoice and voucher regimes as prescribed by law.
C. Trading activities of gold, silver, precious stones, foreign currency.
D. Business establishments must fully implement the accounting, invoice and voucher regimes in accordance with the provisions of the law on accounting, invoices and vouchers and register to pay taxes using the tax deduction method.
Question 10. From January 1, 2009, when selling goods with a tax rate higher than the prescribed rate and the business has not adjusted itself, if the tax authority inspects and detects, it will be handled as follows:
A. New invoices are issued according to the prescribed tax rate.
B. Must declare and pay tax according to the tax rate stated on the invoice.
C. Must declare and pay taxes at the prescribed tax rate.
D. No need to declare or pay taxes.
Question 11. From January 1, 2009, when the tax authority inspects and examines taxes and discovers that the invoice shows a value added tax rate lower than the prescribed rate, how will the seller be handled?
A. New invoices are issued according to the prescribed tax rate.
B. Must declare and pay tax according to the tax rate stated on the invoice.
C. Must declare and pay taxes at the prescribed tax rate.
D. No need to declare or pay taxes.
Question 12. From January 1, 2009, when the tax authority inspects and examines taxes and discovers that the invoice shows a value added tax rate lower than the prescribed rate, how will the buyer be handled?
A. Require the seller to re-issue a new invoice according to the prescribed tax rate and make additional declarations.
B. Input tax deduction according to the tax rate stated on the invoice
C. Input tax deduction at prescribed tax rate
D. No input deductions
Question 13. From January 1, 2009, the conditions for deducting input value added tax (VAT) for goods and services from 20 million VND or more will be supplemented with which of the following provisions?
A. Have VAT invoice
B. Have proof of payment via bank
C. Have proof of cash payment
D. All three answers above
Question 14. From January 1, 2009, which case is not considered payment via bank to be deducted input VAT for goods and services from 20 million VND or more?
A. Debt offset
B. Offset between the value of purchased goods and services and the value of sold goods and services
C. Payment authorization through 3rd party bank payment
D. Cash deposit voucher into seller's account
Question 15. The amount of value added tax payable according to the direct calculation method on VAT is determined by
A. Output VAT minus deductible input VAT
B. Total output VAT
C. The added value of taxable goods and services sold multiplied by the value added tax rate of that type of goods and services.
D. Total value of taxable goods and services sold multiplied by the value added tax rate of that type of goods and services
Question 16. The direct calculation method on VAT applies to which of the following subjects?
A. Individuals and business households do not implement or do not fully implement the regime.
accounting, invoices, documents according to the provisions of law.
B. Foreign organizations and individuals doing business not in accordance with the Investment Law and other organizations that do not implement or do not fully implement the accounting, invoice and voucher regimes as prescribed by law.
C. Trading activities of gold, silver, precious stones, foreign currency.
D. All three answers above are correct.
Question 17. Which of the following invoices, purchase, sale and usage documents are considered illegal?
A. Buying, selling, and using expired invoices.
B. Invoices issued by the Ministry of Finance (General Department of Taxation) are provided by tax authorities to business establishments.
C. Invoices are self-printed by business establishments for use according to prescribed forms and have been accepted for use by tax authorities.
D. Other types of special invoices and documents are allowed to be used.
Question 18. Who is liable for VAT?
A. Seller
B. Seller and buyer bear the same
C. Producer
D. Buyer (consumer)
Question 19. The time to determine revenue for calculating value added tax (VAT) for installment sales of goods is
A. Time the buyer pays