📑 New Legal Basis for VAT (Effective 01/07/2025)
From 01/07/2025, the VAT legal system officially changes. Businesses must pay close attention to the following updates.
1️⃣ Main Legal Documents
- VAT Law 2024 (replaces 2008 Law, effective 01/07/2025).
- Decree 181/2025/ND-CP: detailed guidance on rates, credit, refund.
- Circular 69/2025/TT-BTC: regulations on VAT dossiers and refund procedures.
- Circular 80/2021/TT-BTC (amended by Circular 40/2025/TT-BTC): updated declaration forms 01/GTGT, 02/GTGT, 05/GTGT…
2️⃣ Key Highlights to Remember
A. Branch VAT Declaration & Payment
- Branches declare following the parent company’s method.
- Investment projects: branches/PMUs may credit & refund after offsetting payable VAT.
- Construction/real estate in other provinces: declare using Form 05/GTGT at the project location.
B. Credit Method
- Applied to businesses with ≥ VND 1 billion annual revenue or voluntary registration.
- Conditions: valid invoices, non-cash payment for invoices ≥ VND 5 million (including same-day aggregation).
C. Refund Cases
- Exports: post-offset balance ≥ VND 300 million; refund ≤ 10% of export turnover in refund period.
- Investment projects: after offset, ≥ VND 300 million refundable. Application within 12 months from project/phase completion.
- Goods/services at 5% VAT: after 12 months or 4 quarters, if input VAT ≥ VND 300 million.
- Dissolution/bankruptcy: only if overpaid VAT or uncredited input VAT exists.
- Others: ODA, humanitarian aid, diplomatic missions…
D. Non-Refund Cases
- Production/trading of non-taxable goods (except 0% exports).
- Supplier not declared/owing VAT for relevant period → invoice excluded.
- Projects without sufficient charter capital, or conditional industries not meeting requirements.
E. Key Conditions
- Business under credit method, with a tax-registered bank account.
- Supplier must have declared & paid VAT for the relevant period.
F. Procedures & Dossiers
- New forms: 01/HT, 02/GTGT, 01-1/HT, 05/GTGT…
- E-filing via GDT portal or postal submission.
- Processing deadlines per Circular 80/2021 (amended 2025).
🔑 5 Key Takeaways (2025)
- No refund for goods imported then re-exported → only genuine exports qualify.
- Refund threshold: VND 300 million after offset (exports, investment, 5%).
- Refund limit: ≤ 10% of export turnover in refund period.
- Supplier compliance: undeclared/unpaid VAT → invoice excluded.
- Branches/PMUs: offset & refund at branch level; transfer uncredited VAT when projects are reassigned.
👉 Recommendation
MBA Audit Firm recommends businesses to review all contracts, invoices, and cash flows before 01/07/2025 to avoid risks of refund application rejection.
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