Value-added tax refund for businesses is no longer a strange concept today, value-added tax refund is understood as a tax amount, and returned to the enterprise by the state, after the enterprise deducts input and output value-added tax, but has a surplus of input, the tax will be refunded.
Currently, the tax law of Vietnam, recorded three cases, is refunded value added tax.
- First, the case of construction in progress,
- Second, the case that enterprises generate export revenue,
- Third, the case that the enterprise is dissolved or terminates its operation,
Note, from July 2016, there is no longer a tax refund for domestic sales and purchases. This is bitter content for businesses.
Case one: Tax refund on construction in progress. There are six notes.
The first: New investment projects have not generated revenue, if there is revenue, even if it is only trial sales, it can only be deducted in the next month, or wait for tax refund according to the export category. Therefore, it is necessary to apply for a tax refund before the time when revenue is generated, this point is especially important
The second: The tax balance that has not been fully deducted on the declaration must be over 300,000,000 by the time of requesting a refund.
Third: The company has fully contributed capital according to the capital contribution schedule. The time limit for capital contribution is according to current regulations, which is 90 days from the date of having the business license.
Fourth: If you belong to a conditional business industry, there should be legal procedures related to the full conditional business industry.
Fifth: The point that the law does not detail, but actually applies is to declare on the form 02, added value, the form of VAT declaration withholding for investment projects. If you declare the wrong form (form 01), you need to send an official letter to the tax office to cancel the submitted declaration, and make an additional declaration of the correct declaration.
Sixth: The point that the law does not detail, but needs attention, is to consider whether fixed assets, created for business activities, are subject to value-added tax or not, if it is in a non-taxable industry, it means that the value added tax of fixed assets will not be deducted, and of course not refunded.
Case two: Refund of export tax. There are four notes.
First: Export revenue must go through export procedures at the area of customs operation, according to the provisions of the law on customs.
Second: Exporting enterprises, whose value-added tax balance is still deductible, of export activities, at least 300,000,000.
Third: The number of requests for refund does not exceed 10% of export revenue, of the period of application for refund.
Fourth: Conditions to be considered, as export revenue, must have: Foreign trade contract, export declaration, non-cash payment documents. Refund of tax by month, or quarter depends on the declaration period of the business.
Case three: Tax refund on company dissolution, termination of operation
In this case, the tax authority will finalize the tax at the enterprise, and the refunded tax amount, if any, is the amount, after a decision from the tax authority is obtained.
Above are the notes related to VAT refund for businesses, see you on the next topic.
