Vietnam’s VAT Requirements

VAT in Vietnam

Over the last 10 years, the Vietnamese government has worked on developing a solution to tackle the country’s VAT fraud and the VAT gap, introducing an e-invoicing mandate for all companies doing business in Vietnam from 1 July 2022.

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Reforms

The Vietnam e-invoicing mandate was initially slated to be in force by July 2020, but ultimately was delayed. In October 2020, a new timeline was laid out through Decree 123 announcing implementation dates for the new e-invoicing mandate rules that were originally envisaged in the Law on Tax Administration.

An initial rollout will begin from March 2022 to a select number of provinces and cities. The country’s new e-invoicing requirements will come into effect nationwide on 1 July 2022.

Quick facts

Applicable taxpayers in Vietnam will be required to issue e-invoices for their transactions from 1 July 2022.
Legal framework must be followed for all e-invoice submissions.
Enterprises, organisations (economic or otherwise), business households and individuals must register with the local tax administration to start using e-invoicing.
There are two types of e-invoicing processes in Vietnam. Authenticated invoices are granted an authentication code by the tax authority before the invoice is transmitted to the buyer, whereas unauthenticated e-invoices do not require the tax authority’s authentication code.

Electronic invoices must be issued in XML format.
VAT, sales invoices, and the invoices used for selling public assets are among the documents under the scope of the e-invoicing mandate.
Ensuring of the integrity and authenticity of the e-invoices is required and must be digitally signed by the supplier.
E-invoices must be archived electronically and taxable persons may choose archiving methods guaranteeing security and integrity and authenticity during the entirety of the archiving period.
Service providers meeting specific requirements can provide the contracting parties with e-invoicing solutions.

Mandate rollout dates

March 2022 – Vietnam General Taxation Department (GTD) will first work with six local tax administrations: Ho Chi Minh City, Hanoi, Binh Dinh, Quang Ning, Hai Phong and Phu Tho to start implementing technical solutions for new e-invoicing requirements and construction of an IT system for connection, data transmission, reception and storage of data.
April 2022 – E-invoicing system will be rolled out to the remaining provinces and cities.
1 July 2022 – All cities and provinces must deploy the e-invoicing system based on the rules established in Decree 123 and the Circular that provides guidance and clarification to certain aspects of the new e-invoicing system.

How can Sovos help?

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Learn how Sovos’ solutions for continuous transaction controls and VAT compliance obligations can help your company stay compliant.