Công văn 4144/TCT-CS

To: Provincial Departments of Taxation

On June 13, 2019, the 14^th National Assembly has ratified the Law on tax administration No. 38/2019/QH14 which comes into force from July 01, 2020. Regulations on invoices and records laid down in this Law come into force from July 01, 2022. Authorities, organizations and individuals are encouraged to apply regulations on invoices and records laid down in this Law before July 01, 2022.

On October 19, 2020, the Government has promulgated the Decree No. 123/2020/ND-CP prescribing invoices and records, which comes into force from July 01, 2022.

On September 17, 2021, the Ministry of Finance has promulgated the Circular No. 78/2021/TT-BTC providing guidance on the Law on tax administration and Decree No. 123/2020/ND-CP , which comes into force from July 01, 2022.

The General Department of Taxation hereby introduces new regulations of the Circular No. 78/2021/TT-BTC and request Provincial Departments of Taxation to promptly bring them to the attention of tax officials and taxpayers under their management.

 (Detailed contents are provided in the Appendix enclosed herewith).

Difficulties that arise during the implementation of this Circular should be reported to the General Department of Taxation for consideration./.

APPENDIX

INTRODUCTION OF NEW REGULATIONS OF CIRCULAR NO. 78/2021/TT-BTC DATED SEPTEMBER 17, 2021 OF THE MINISTRY OF FINANCE PRESCRIBING INVOICES AND RECORDS
(Enclosed with the Official Dispatch No. 4144/TCT-CS dated October 28, 2021 of the General Department of Taxation)

1. Use of electronic invoices and records: comply with Chapter X of the Law on tax administration.

2. Management and use of invoices for sale and provision of goods and services; management and use of records for completion of procedures related to taxes, fees and charges, and tasks, powers and responsibilities of regulatory authorities, organizations and individuals in management and use of invoices and records: comply with the Government’s Decree No. 123/2020/ND-CP dated October 19, 2020.

3. New regulations of Circular No. 78/2021/TT-BTC:

3.7. Authorization to issue e-invoices prescribed in Article 3 of the Circular No. 78/2021/TT-BTC

Clause 7 Article 4 of the Decree No. 123/2020/ND-CP dated October 19, 2020 provides regulations on authorization to issue e-invoices and assigns the Ministry of Finance to provide specific guidelines [1].

Article 3 of the Circular No. 78/2021/TT-BTC stipulates the authorization to issue e-invoices as follows:

- A third party (that is authorized to issue e-invoices) is a related party of the seller, eligible to use e-invoices and is not suspended from use of e-invoices.

A related party shall be determined according to Clause 2 Article 5 of the Government’s Decree No. 132/2020/ND-CP dated November 05, 2020 prescribing tax administration for enterprises having related-party transactions[2].

Cases in which the use of e-invoices is suspended are prescribed in Clause 1 Article 16 of Decree No. 123/2020/ND-CP[3].

- An e-invoice issued by the authorized party is an e-invoice with or without the tax authority’s authentication code but must bear the name, address and TIN of the authorizing party and those of the authorized party, and correctly reflect actual amounts.  

In case invoices to be made out with authorization are e-invoices without the tax authority’s authentication code (hereinafter referred to as “unauthenticated invoices”), the authorizing party shall transmit e-invoice data to their supervisory tax authority directly or through an e-invoice service provider.

- The authorization must be made in writing (authorization contract or authorization agreement) between two parties, and bear the following information:

+ Particulars of the authorizing party and the authorized party (including name, address, TIN and digital certificate);

+ Information about the e-invoice issued with authorization (type, form number and reference number of the invoice);

+ Purposes of authorization;

+ Duration of authorization;

+ Methods of payment for invoices issued with authorization (including responsibility to make payment for the invoiced goods/services);

- The authorization is considered as a change in information provided in the application for use of e-invoices, so the authorizing party and the authorized party must register (notify) their supervisory tax authorities of authorization to issue e-invoices, including cases of early termination of such authorization, as prescribed in Article 15 of Decree No. 123/2020/ND-CP. Information about digital certificate, name and TIN of two parties shall be provided in Part 5, Part 6 of Form No. 01DKTD/HDDT enclosed with Decree No. 123/2020/ND-CP .

- Responsibilities of the authorizing party and the authorized party:

+ When giving authorization to issue e-invoices: two parties shall bring to buyers’ attention all information about the authorization by publishing such information their websites or mass media;

+ When the authorization expires or is terminated before its expiration date as agreed upon between two parties, two parties shall remove all notices/information about such authorization published on their websites or mass media;

3.2. Form number, reference number and names of copies of an invoice prescribed in Article 4 of the Circular No. 78/2021/TT-BTC

3.2.1. E-invoices

- Form number of an e-invoice is a digit from 1 to 6 depending on the type of e-invoice, including: Electronic VAT invoice; Electronic sales invoice; E-invoice for sale of public property; E-invoice for sale of national reserve goods; Other types of e-invoice, including electronic stamp, ticket, card, receipt or other electronic documents that have other names but have the same contents as an e-invoice as prescribed in the Decree No. 123/2020/ND-CP ; Electronic records which are used and managed in the same manner as invoices, including electronic delivery and internal consignment notes, and electronic delivery notes for goods sent to sales agents.

- Reference number of an e-invoice contains 6 characters, including letters and numbers, indicating the following information:

+ The first character: C if the invoice bears a tax authority’s authentication code (authenticated invoice); K if the invoice does not bear a tax authority’s authentication code (unauthenticated invoice);

+ The next two characters are the last two digits of the year in which the e-invoice is issued, written in Arabic numerals.

+ The next character is either T, D, L, M, N, B, G or H depending on the type of e-invoice.

+ The last two characters shall be decided by the seller to serve their management requirements. If the seller uses different forms of the same type of e-invoice, the last two characters shall be used to differentiate such e-invoice forms. If the seller does not decide the last two characters, YY shall be specified;

3.2.2. Tax authority-ordered printed invoices

- The form number of a provincial department of taxation-ordered printed invoice contains 11 characters indicating the name of invoice form, number of copies, ordinal number of invoice form (if there are different forms of the same invoice type). To be specific:

+ The first 6 characters indicate the name of invoice type. To be specific: 01GTKT: VAT invoice; 02GTTT: Sales invoice; 07KPTQ: Sales invoice used by the entities in free trade zones; 03XKNB: Delivery and internal consignment note; 04HGDL: Delivery note for goods sent to sales agents.

+ The next character is a digit 1, 2 or 3 depending on the number of copies of the invoice;

+ The next character is “/” for separation;

+ The next three characters indicate the ordinal number of form of an invoice type, from 001 to 999.

- Reference number of a provincial department of taxation-ordered printed invoice contains 08 characters, indicating the name of the provincial department of taxation that orders the printing of invoices, year of order placement, and is decided by the provincial department of taxation to serve its management. To be specific:

+ The first two characters are the code of the provincial department of taxation ordering the printing of invoices and determined according to Appendix I.A enclosed herewith the Circular No. 78/2021/TT-BTC ;

+ The next two characters are two letters in the 20-letter Vietnamese alphabet, including: A, B, C, D, E, G, H, K, L, M, N, P, Q, R, S, T, U, V, X, Y, and decided by the tax authority to serve its management;

+ The next character is “/” for separation;

+ The next three characters consist of the last two digits of the year in which the invoice printing is ordered by the provincial department of taxation, written in Arabic numerals, and the letter P indicating that the invoice is printed according to the order of the provincial department of taxation.

- Copies of a provincial department of taxation-ordered printing invoice are sheets of the invoice of the same reference number. Invoice of a reference number contains 3 copies, including: Copy 1: for retention; Copy 2: for the buyer; Copy 3: for internal delivery.

- The form number of a provincial department of taxation-ordered printed stamp, ticket or card contains 03 characters indicating whether it is VAT invoice or sales invoice. To be specific:

- 01/: VAT invoice in the form of stamp, ticket or card;

- 02/: sales invoice in the form of stamp, ticket or card.

3.3. Conversion to authenticated e-invoices prescribed in Article 5 of the Circular No. 78/2021/TT-BTC

3.3.1. If a taxpayer that is using unauthenticated e-invoices wants to use authenticated e-invoices, it shall follow procedures for modification of information about the use of e-invoice as prescribed in Article 15 of Decree No. 123/2020/ND-CP .

Users of unauthenticated e-invoices shall be determined according to Clause 2 Article 91 of the 2019 Law on tax administration 4.

When applying for modification of information about the use of invoices, the taxpayer shall fill in Form 01DKTD/HDDT enclosed with the Decree No. 123/2020/ND-CP , of which Item “Invoice with code of tax authority" in Part 1 "Form of invoice" must be marked, and send it to the tax authority. 

3.3.2. If a taxpayer that is eligible to use unauthenticated e-invoices (determined according to Clause 2 Article 91 of the 2019 Law on tax administration⁴) falls into the case of high tax risk specified in the Circular No. 31/2021/TT-BTC dated May 17, 2021 of the Ministry of Finance and has received a notice from the tax authority, the taxpayer shall follow procedures for use of authenticated e-invoices as notified.

Within 10 working days from the receipt of the tax authority’s notice, the taxpayer shall follow procedures for modification of information about use of e-invoices (conversion from unauthenticated e-invoices to authenticated e-invoices) as prescribed in Article 15 of Decree No. 123/2020/ND-CP by way of submitting Form No. 01DKTD/HDDT enclosed with the Decree No. 123/2020/ND-CP , of which Item “Invoice with code of tax authority" in Part 1 "Form of invoice" must be marked, to the tax authority, and comply with the tax authority’s notice.

After 12 months from the date of conversion to use authenticated e-invoices, if the taxpayer wants to use unauthenticated e-invoices, it shall follow procedures for modification of information about use of e-invoices as prescribed in Article 15 of Decree No. 123/2020/ND-CP (the taxpayer shall submit Form No. 01DKTD/HDDT enclosed with the Decree No. 123/2020/ND-CP , of which Item “Invoice without code of tax authority" in Part 1 "Form of invoice" must be marked, to the tax authority). The tax authority shall, based on regulations on eligible users and conditions for use of unauthenticated e-invoices laid down in Clause 2 Article 91 of the Law on tax administration⁴ and the Circular No. 31/2021/TT-BTC dated May 17, 2021, decide to approve or refuse the taxpayer's application for use of unauthenticated e-invoices.

3.4. Use of e-invoices in some other cases prescribed in Article 6 of the Circular No. 78/2021/TT-BTC

Clause 4 Article 13 of the Decree No. 123/2020/ND-CP stipulates that the Ministry of Finance shall provide the use of e-invoices in some other cases (in addition to eight (08) cases specified in Clause 3 Article 13 of Decree No. 123/2020/ND-CP) to serve management requirements.

Article 6 of the Circular No. 78/2021/TT-BTC provides guidelines for transfer of data on unauthenticated e-invoices to tax authorities, transfer of e-invoice data in case of selling of petrol and oil products, use of e-invoices by household businesses and in case of banking services as follows:

3.4.1. Transfer of data on unauthenticated e-invoices to tax authorities:

The seller shall concurrently send the e-invoice to the tax authority within the same day in which it is issued to the buyer.

Unauthenticated e-invoices shall be sent to buyers according to Point a.2 Clause 3 Article 22 of the Decree No. 123/2020/ND-CP5.

3.4.2. In case of petrol and oil business: The seller shall transfer data on invoices for sale of petrol and oil to the tax authority within the day as prescribed in Point a.1 Clause 3 Article 22 of the Decree No. 123/2020/ND-CP6.

Where the seller and the buyer has entered into an agreement which facilitates the circulation of goods or data search, the seller shall concurrently send the e-invoice that contains adequate information as prescribed to both the buyer and the tax authority.

3.4.3. Household businesses and individual businesses that use e-invoices include:

- A household business or individual business that pays tax using declaration method is required to issue e-invoices;

- If a household business or individual business that pays presumptive tax needs to issue invoices, they shall use e-invoices separately issued by the tax authority;

- If a household business or individual business that declares tax separately needs to issue invoices, they shall use e-invoices separately issued by the tax authority.

3.4.4. Banking services:

- Invoices shall be issued periodically under terms and conditions of the service contract signed between two parties but must be issued by the last day of the month in which services are provided. The invoice must be accompanied by statements or other documents bearing certification of two parties.

- Where a large volume of banking services is provided regularly and requires more time for checking and verifying data/figures between the bank and relevant third parties (including settlement organizations, international card service providers or other organizations), invoices shall be issued upon completion of data/figures verification between the parties but no later than the 10^th day of the month following the month in which services are provided.

3.5. Handling of errors in some cases

Article 19 of the Decree No. 123/2020/ND-CP stipulates the handling of erroneous e-invoices (first handling).

Article 7 of the Circular No. 78/2021/TT-BTC provides guidelines on further handling of e-invoices which are still erroneous after the first handling, handling of e-invoice datasheets which contain errors, are inadequate, or need to be modified. To be specific:

3.5.1. Rules for handling of erroneous e-invoices:

- If the issued e-invoice contains errors and requires a new tax authority’s authentication code or the erroneous e-invoice needs to be corrected or replaced, the seller may choose to notify the correction of each or multiple erroneous e-invoices to the tax authority by the last day of the VAT declaration period in which erroneous e-invoices are handled.

The seller shall notify the correction of erroneous invoices to the tax authority using Form No. 04/SS-HDDT in Appendix IA enclosed with the Decree No. 123/2020/ND-CP .

- If an invoice has been issued when receiving advance payment or during the service provision but then the service provision is cancelled or terminated, the seller shall cancel the issued e-invoice and bring to attention of the tax authority all information about such cancellation.

- If the erroneous e-invoice has been handled by correction or replacement method but then is found to have other errors, these errors shall be handled using the same method as the first handling.

- If the issued e-invoice which does not necessarily bear the form number, reference number or number of invoice contains errors, the seller shall only correct the erroneous invoice without cancelling or replacing it;

- If the value specified in the invoice is wrong, an increase ( “+” mark) or decrease ( “-“ mark) shall be specified in the invoice according to the actual value.

3.5.2. Handling of inadequate or erroneous e-invoice datasheet and invoices included therein

- After the prescribed deadline for submission of e-invoice datasheet to the tax authority, if the submitted e-invoice datasheet is found inadequate, the seller may send an additional datasheet.

- In case the e-invoice datasheet sent to the tax authority is erroneous, the seller may send supplementary information.

- In case of correction of an invoice specified in the e-invoice datasheet, the information about the form number, reference number and number of the invoice must be specified (unless an e-invoice does not necessarily bear the form number, reference number and number of the invoice).

3.5.3. The supplementation of tax declaration documents concerning corrected or replaced e-invoices (including cancelled e-invoices) shall be carried out in accordance with regulations of the Law on tax administration.

3.6. E-invoices generated from POS cash registers prescribed in Article 8 of the Circular No. 78/2021/TT-BTC

3.6.1. Regulated entities:

In order to facilitate the continuous issuance of a large amounts of invoices of enterprises, household businesses or individual businesses that pay taxes using declaration method and use authenticated or unauthenticated e-invoices when providing goods and/or services directly to consumers according to such business models as shopping mall, supermarket, retailing of consumer goods, foods and drinks, restaurants, hotels, retailing of modern medicines, entertainment and relaxation services and other services, they may use either e-invoices generated from POS cash registers that are digitally connected to tax authorities or authenticated e-invoices or unauthenticated e-invoices.

3.6.2. Application rules:

- E-invoices generated from POS cash registers that are digitally connected to tax authorities shall bear codes of tax authorities and meet the requirements laid down in Article 11 of the Decree No. 123/2020/ND-CP , including:

+ Invoices printed out from POS cash registers that are digitally connected to tax authorities must be recognizable as authenticated e-invoices. Tax authority’s authentication codes on e-invoices generated from POS cash registers shall consist of a series of characters and be issued automatically to each business establishment and must not be coincided. When issuing e-invoices generated from POS cash registers, taxpayers shall use authentication codes, consisting of a series of characters, issued by tax authorities in a manner ensuring the continuity and unity of issued codes;

+ Digital signatures on such invoices are optional;

+ The spending on goods and/or services written in the invoice (or the scanned invoice or the information search result on the e-invoice page in the Web Portal of the General Department of Taxation) which is generated by a POS cash register may be defined as an expense supported by adequate legal invoices and records upon determination of tax obligations.

- An authenticated e-invoice generated from a POS cash register that is digitally connected to tax authorities shall have the following contents: The seller’s name, address and TIN; Information about the buyer, if requested (personal authentication number of TIN); Name of good/service, unit price, quantity and payment price. If an organization or enterprise pays taxes using credit-invoice method, the selling price exclusive of VAT, VAT rate, total VAT payable, and total amount payable inclusive of VAT, date of invoice, and tax authority’s code must be specified.

3.6.3. Responsibilities of taxpayers

When using e-invoices generated from POS cash registers, the taxpayer shall:

+ Apply for use of e-invoices in accordance with Article 15 of Decree No. 123/2020/ND-CP .

+ Issue invoices to clients. Issued invoices must meet the rules laid down in Article 11 of the Decree No. 123/2020/ND-CP and Clause 3 Article 8 of the Circular No. 78/2021/TT-BTC .

+ Use codes consisting of a series of characters issued by tax authorities when issuing e-invoices generated by POS cash registers in a manner ensuring continuity and unity.

+ Transfer data on e-invoices generated from POS cash registers to tax authorities within the day in which such invoices are issued through data receipt, transmission and storage service providers.

3.6.4. Data composition, data transmission methods, and roadmap for application of e-invoices generated from POS cash registers shall comply with guidelines given by tax authorities.

3.7. Use of receipts and records prescribed in Article 9 of the Circular No. 78/2021/TT-BTC

3.7.1. Use of tax receipts

- Provincial department of taxations shall print, create and issue tax receipts according to Form CTT50 in the form of externally- or internally-printed or electronic receipts for use when collecting taxes, fees and charges from household and individual businesses in the areas that meet conditions for use of receipts, and collecting debts from household businesses paying presumptive taxes, agricultural and non-agricultural land levy from family households and individuals.

- An area eligible to use tax receipts is required to meet all of the following 03 conditions: there is no collection sites; no authorization to collect tax is made; it is a disadvantaged or extremely disadvantaged area according to regulations on determination of disadvantaged communes. Sub-departments of taxation/regional sub-departments of taxation shall determine and submit lists of areas eligible to use tax receipts to provincial departments of taxation for approval.

3.7.2. Use of other types of records or receipts of which some items are changed

- During their management of taxes, fees and charges as prescribed in the Law on tax administration, if an organization wants to use other types of records as prescribed in Clause 2 Article 30 of Decree No. 123/2020/ND-CP , it shall be required to obtain an approval from the Ministry of Finance (via the General Department of Taxation).

- If collectors of fees and charges want to change some compulsory items of an electronic receipt as prescribed in Clause 2 Article 32 of Decree No. 123/2020/ND-CP , they must apply for approval of the Ministry of Finance (via the General Department of Taxation).

3.8. Eligibility criteria to be satisfied by e-invoice service providers to enter into contracts for provision of authenticated e-invoice services, e-invoice data receipt, transmission and storage services, and other relevant services prescribed in Article 10 of the Circular No. 78/2021/TT-BTC

3.8.1. Providers of authenticated and unauthenticated e-invoice solutions for sellers and buyers

Eligibility criteria:

- Entity: It is an IT organization established under the law of Vietnam; Information about e-invoice services is published on its website.

- Personnel: There are at least 5 employees possessing bachelor’s degree in IT.

- Technology: There are IT infrastructure facilities and equipment, and software system meeting the following requirements: They are adequate to provide solutions for creating, handling and storing data on authenticated and unauthenticated e-invoices for sellers and buyers as prescribed by the Law on e-invoices and relevant laws; There are solutions for receiving and transmitting e-invoice data from and to service users; solutions for transmitting and receiving e-invoice data to and from tax authorities through e-invoice data receipt, transmission and storage service provider. Information about data receipt and transmission must be fully recorded to serve verification purposes; Solutions for backup, recovery and protection of confidentiality of e-invoice data are available; There are written records of successful technical testing on solutions for transmission and receipt of e-invoice data with the e-invoice data receipt, transmission and storage service provider.

Procedures for publishing information on the Web Portal of the General Department of Taxation:

- The applicant (e-invoice solution provider) shall send an application which includes documents proving its satisfaction of eligibility criteria such as description of its services and commitment to provide service to the General Department of Taxation. Within 10 days from the receipt of the application, the applicant’s description of its services and commitment shall be published on the website of the General Department of Taxation.

- The applicant shall assume responsibility for all documents included in its application. During its operation, if the applicant is found to provide services against regulations, the General Department of Taxation shall give a notification and remove all information about the applicant published on the website of the General Department of Taxation.

3.8.2. E-invoice data receipt, transmission and storage service providers

Eligibility criteria:

- Entity: It is an organization established under the law of Vietnam and has been operating in the IT field for at least 05 years; Information about e-invoice services is published on its website.

- Finance: It has paid a deposit at a bank lawfully operating in Vietnam or has obtained a guarantee of not less than VND 5 billion from a bank lawfully operating in Vietnam to manage risks and make compensation for any damage that may occur during the service provision;

- Personnel: There are at least 20 employees possessing bachelor’s degree in IT;

- Technology: There are IT infrastructure facilities and equipment, and software system meeting the following requirements: They are adequate to provide solutions for creating, handling and storing data on authenticated e-invoices in accordance with the Law on e-invoices and relevant laws; There are solutions for connecting, receiving, transmitting and storing e-invoice data with organizations providing authenticated and unauthenticated e-invoice services for sellers and buyers; solutions for connecting, receiving, transmitting and storing e-invoice data with tax authorities. Information about data receipt and transmission must be fully recorded to serve verification purposes; The technical systems and equipment used for providing e-invoice services are operated on both the main data center and backup center. The backup center is located at least 20 km away from the main data center and is ready for use when the main data center encounters problem; The system must be capable of detecting, giving warning and preventing illegal access and cyberattacks to ensure the confidentiality and integrity of data exchanged between parties; The system for backing up and recovering data must be available; It is connected to the General Department of Taxation through a separate channel or MPLS VPN of Layer 3 or equivalent level, which consists of 1 main channel and 2 backup channels. Each channel has a minimum bandwidth of 20 Mbps; use an encrypted Web Service or Message Queue (MQ) for connection; use SOAP/TCP to compile, transmit and receive data.

Procedures for conclusion of contract with the General Department of Taxation:

The organization that meets all of eligibility requirements shall submit an application for conclusion of the contract for provision of e-invoice data receipt, transmission and storage services, including supporting documents, to the General Department of Taxation. Within 10 working days from the receipt of adequate supporting documents, the General Department of Taxation shall cooperate with the service provider to make technical connections and check data transmission and receipt between two parties. After the connection has been successfully made, the General Department of Taxation and the service provider shall enter into a contract for provision of e-invoice data receipt, transmission and storage services for tax authorities. Information about the e-invoice data receipt, transmission and storage service provider shall be published on the website of the General Department of Taxation.

3.9. Effect prescribed in Article 11 of the Circular No. 78/2021/TT-BTC

- The Circular No. 78/2021/TT-BTC comes into force from July 01, 2022.

- Household businesses and individual businesses shall use e-invoices from July 01, 2022. Except the cases specified in Clause 1 Article 14 of Decree No. 123/2020/ND-CP7 where the household business or individual business does not carry out electronic transactions with tax authorities, does not have IT infrastructure, accounting software system or e-invoicing software enabling the use of e-invoices and transfer of e-invoice data to buyers and tax authorities, physical invoices provided by tax authorities may be used within the maximum period of 12 months, and tax authorities shall adopt measures for facilitating their gradual use of e-invoices. This maximum period of 12 months existing in a one-off manner starts from July 01, 2022 if the household business or individual business starts their business before July 01, 2022, or the date of registration of use of invoices if the household business or individual business sets up in business on or after July 01, 2022.

- From July 01, 2022, the following Circulars and Decisions of the Ministry of Finance shall cease to have effect, including:

+ Decision No. 30/2001/QD-BTC dated April 13, 2001 introducing policies on printing, issuance, management and use of tax records;

+ Circular No. 191/2010/TT-BTC dated December 01, 2010 providing guidelines for management and use of transport invoices;

+ Circular No. 32/2011/TT-BTC dated March 14, 2011 providing guidelines for generation, issuance and use of electronic invoices for sale of goods and provision of services;

+ Circular No. 39/2014/TT-BTC dated March 31, 2014 (as amended in the Circular No. 119/2014/TT-BTC dated August 25, 2014 and Circular No. 26/2015/TT-BTC dated February 27, 2015);

+ Decision No. 1209/QD-BTC dated June 23, 2015 prescribing pilot application of authenticated electronic invoices; Decision No. 526/QD-BTC dated April 16, 2018 prescribing expansion of the scope of pilot application of authenticated electronic invoices;

+ Decision No. 2660/QD-BTC dated December 14, 2016 prescribing extension to the implementation period of Decision No. 1209/QD-BTC dated June 23, 2015;

+ Circular No. 303/2016/TT-BTC dated November 15, 2016 providing guidelines for printing, issuance, management and use of receipts of fees and charges payable to state budget;

+ Circular No. 37/2017/TT-BTC dated April 27, 2017 providing amendments to the Circular No. 39/2014/TT-BTC dated March 31, 2014 (as amended in the Circular No. 119/2014/TT-BTC dated August 25, 2014 and Circular No. 26/2015/TT-BTC dated February 27, 2015);

+ Circular No. 68/2019/TT-BTC dated September 30, 2019 providing guidance on implementation of some Articles of the Government's Decree No. 119/2018/ND-CP dated September 12, 2018 on electronic invoices;

+ Circular No. 88/2020/TT-BTC dated October 30, 2020 providing amendments to Article 26 of the Circular No. 68/2019/TT-BTC dated September 30, 2019 of Ministry of Finance providing guidance on implementation of some Articles of the Government's Decree No. 119/2018/ND-CP dated September 12, 2018 on electronic invoices.

3.10. Transition clauses prescribed in Article 12 of the Circular No. 78/2021/TT-BTC

- Enterprises and business entities that have informed the issuance of externally-printed invoices or internally-printed invoices, unauthenticated e-invoices or have applied for use of authenticated e-invoices, or have purchased invoices from tax authorities before the effective date of the Circular No. 78/2021/TT-BTC are allowed to continue using these invoices from the date of promulgation of the Circular No. 78/2021/TT-BTC to June 30, 2022 inclusively, and following invoice-related procedures as provided for in the Government’s Decree No. 51/2010/ND-CP dated May 14, 2010 and the Government’s Decree No. 04/2014/ND-CP dated January 17, 2014.

From the date of promulgation of the Circular No. 78/2021/TT-BTC to June 30, 2022 inclusively, at the request of the General Department of Taxation, the business establishments in areas that meet infrastructure requirements for use of e-invoices according to the Ministry of Finance’s Decision shall use e-invoices in accordance with regulations of this Circular according to the roadmap notified by tax authorities. The business establishments that do not meet IT infrastructure requirements and continue using invoices in the abovementioned forms shall send invoice data to tax authorities using Form No. 03/DL-HDDT in Appendix IA enclosed with Decree No. 123/2020/ND-CP when they submit VAT returns. Tax authorities shall include invoice data received from these business establishments into the invoice database and publish them on the Web Portal of the General Department of Taxation to serve invoice data searching.

- Business establishments that are established within the period from the date of promulgation of the Circular No. 78/2021/TT-BTC to June 30, 2022 inclusively shall follow guidelines given by tax authorities to use e-invoices in accordance with the provisions of Decree No. 123/2020/ND-CP , Decree No. 119/2018/ND-CP dated September 12, 2018, Circular No. 68/2019/TT-BTC and the Circular No. 78/2021/TT-BTC. If they fail to meet IT infrastructure requirements and continue to use invoices in accordance with Decree No. 51/2010/ND-CP dated May 14, 2010 and Decree No. 04/2014/ND-CP dated January 17, 2014, they shall comply with the same provisions applicable to the abovementioned business establishments.

- Tax authorities may sell their externally-printed invoices as prescribed in Decree No. 51/2010/ND-CP dated May 14, 2010 and Decree No. 04/2014/ND-CP dated January 17, 2014 to eligible buyers from July 01, 2022 as prescribed in Article 23 of the Government’s Decree No. 123/2020/ND-CP dated October 19, 2020 if form numbers and reference numbers of these invoices comply with regulations of this Circular and their contents comply with regulations of the Government’s Decree No. 123/2020/ND-CP dated October 19, 2020.

- Fee and charge receipts made using the Form provided in Circular No. 303/2016/TT-BTC dated November 15, 2016 of the Ministry of Finance and tax receipts printed according to Decision No. 30/2001/QD-BTC dated April 13, 2001 of the Ministry of Finance may continue to be used. After these receipts have been used up, the receipt form provided in the Government’s Decree No. 11/2020/ND-CP dated January 20, 2020 shall be used. When receiving notifications from tax authorities of use of e-receipts in the format prescribed by tax authorities, relevant organizations shall carry out conversion, and apply for use, notify issuance, and submit reports as prescribed in Article 34, Article 36, Article 38 of the Government’s Decree No. 123/2020/ND-CP .

- Personal income tax (PIT) deduction documents shall continue to be used in accordance with Circular No. 37/2010/TT-BTC dated March 18, 2010 of the Ministry of Finance (and its amending documents) and Decision No. 102/2008/QD-BTC dated November 12, 2008 of the Minister of Finance until the end of June 30, 2022. Organizations deducting PIT that meet IT infrastructure requirements may use electronic PIT deduction documents as prescribed in Decree No. 123/2020/ND-CP dated July 01, 2022 and follow procedures as prescribed in the Circular No. 37/2010/TT-BTC dated March 18, 2010 of the Ministry of Finance

- Since enterprises, organizations, household and individual businesses use e-invoices as prescribed in the Government’s Decree No. 123/2020/ND-CP and the Circular No. 78/2021/TT-BTC , if any invoice issued according to the Government’s Decree No. 51/2010/ND-CP dated May 14, 2010, the Government’s Decree No. 04/2014/ND-CP dated January 17, 2014 and guiding documents given by the Ministry of Finance is found erroneous, the seller and the buyer shall enter into an agreement indicating errors, and the seller shall give notification to the tax authority using Form No. 04/SS-HDDT enclosed with the Government’s Decree No. 123/2020/ND-CP and issue a new e-invoice (either authenticated or unauthenticated e-invoice) to replace the erroneous invoice. The replacing invoice shall bear the text “Thay thế cho hóa đơn Mẫu số... ký hiệu... số... ngày... tháng... năm” (“This invoice replaces invoice No. … dated … ").  The seller shall add its digital signature to the new invoice which is issued to replace the erroneous one (which is issued according to the Government’s Decree No. 51/2010/ND-CP , the Government’s Decree No. 04/2014/ND-CP and guiding documents given by the Ministry of Finance), and then send it to the buyer (in case of unauthenticated invoices) or send it to the tax authority for its issuance of a new authentication code (in case of authenticated invoices).

[1] Clause 7 Article 4 of the Decree No.123/2020/ND-CP stipulates:

"7. Good sellers or service providers that are enterprises, business entities or other organizations are allowed to authorize third parties to issue e-invoices for their sale of goods or provision of services. An invoice issued by a third party with authorization must still bear the name of the seller that is the authorizing party. The authorizing party and the authorized party must enter into a written authorization which must contain adequate information on invoices to be made with authorization (purposes and duration of authorization, and method of payment for invoices made out with authorization). Such authorization must be notified to tax authorities when applying for use of e-invoices. In case invoices to be made out with authorization are unauthenticated invoices, the authorizing party shall transmit e-invoice data to tax authorities through the e-invoice service provider. The Ministry of Finance shall provide specific guidelines on this content.”

[2] Clause 2 Article 5 of the Decree No.132/2020/ND-CP dated November 5, 2020 stipulates:

 “2. Related parties referred to in Clause 1 of this Article shall be subject to the following specific provisions:

a) An enterprise holds directly or indirectly at least 25% of the other enterprise’s equity;

b) Each of the two enterprises has at least 25% of its equity held, whether directly or indirectly, by a third party;

c) An enterprise is the shareholder having the greatest ownership interest in the other enterprise, or participates directly or indirectly in at least 10% of total share capital of the other enterprise;

d) An enterprise guarantees or offers another enterprise a loan under any form (even including third-party loans guaranteed by financing sources of related parties and financial transactions of same or similar nature) to the extent that the loan amount equals at least 25% of equity of the borrowing enterprise and makes up for more than 50% of total medium and long term debts of the borrowing enterprise;

dd) An enterprise appoints a member of the executive board responsible for the leadership or control of another enterprise provided the number of members appointed by the former accounts for more than 50% of total number of members of the executive board responsible for the leadership or control of the latter; or a member appointed by the former has the right to decide financial policies or business activities of the latter;

e) Both related enterprises appoint more than 50% of membership of the executive board or have one member of the executive board authorized to decide financial policies or business activities who is appointed by a third party;

g) Both enterprises are managed or controlled in terms of their personnel, financial and business activities by individuals, each of whom is in one of the following relationships with the others such as a wife, husband, natural/foster father, natural/foster child, natural/foster older/younger sibling, brother/sister-in-law, maternal/paternal grandfather/grandmother, maternal/paternal grandchild, and maternal/paternal aunt, uncle and nibling;

h) Both business entities have transactions, either between their head offices and permanent establishments or between permanent establishments of overseas entities or individuals;

i) Enterprises are put under control of one individual through either his/her capital participation into that enterprise or his direct involvement in the administration of that enterprise;

k) In other cases where an enterprise has their business activities managed, controlled or decided de facto by the other enterprise;

l) A related enterprise performs the disposition or acquisition transaction in at least 25% of their equity within a tax period; the borrowing or lending transaction in at least 10% of their equity performed at the transaction time falling within a tax period with a person holding the executive office or the controlling interest in the enterprise, or with a person in one of the relationships prescribed in Point g of this Clause.

[3] Clause 2 Article 5 of the Decree No.132/2020/ND-CP dated November 5, 2020 stipulates:

 “Article 16. Suspension of use of e-invoices

1. Enterprises, business entities, other organizations, household or individual businesses shall suspend their use of authenticated and unauthenticated e-invoices in the following cases:

a) An enterprise, business entity, other organization, household business or individual business has its TIN invalidated;

b) An enterprise, business entity, other organization, household business or individual business does not operate at the registered location as verified and announced by the tax authority;

c) An enterprise, business entity, other organization, household business or individual business has sent a notification of business suspension to a competent authority;

d) An enterprise, business entity, other organization, household business or individual business is banned from using e-invoices by the tax authority for the purpose of enforcement of payment of tax debts;

dd) E-invoices are used to sell smuggled goods, banned goods, counterfeits, goods violating intellectual property rights as detected and informed by competent authorities;

e) E-invoices are used for short selling of goods or services for fraudulent purposes as detected and informed by competent authorities;

g) A business registration authority or competent authority requests an enterprise to suspend operation in a conditional business line after finding that this enterprise does not fully satisfy the business conditions prescribed by law.

If the tax authority, through inspection, discovers that the enterprise is established for the purpose of trade and use of illegal e-invoices or illegal use of e-invoices for tax evasion purposes, the enterprise shall face administrative penalties and be suspended from use of e-invoices according to the decision issued by the tax authority.”

4 Clause 2 Article 91 of the 2019 Law on tax administration stipulates: Enterprises operating in the field of electricity, oil and gas, post and telecommunications, clean water supply, credit, insurance, health, e-commerce, supermarket, commerce, air/road/rail/sea/inland waterway transport; enterprises and business entities that have been or will conduct electronic transactions with tax authorities, develop information technology infrastructure, have software for accounting, issuance, access and storage of e-invoices, and ensure the transmission of e-invoice data to buyers and tax authorities may use unauthenticated e-invoices when selling goods/services, regardless of the value of each sale.

5 Point a.2 Clause 3 Article 22 of the Decree No.123/ND-CP stipulates:

 “a.2) Transmission of invoices for sale of goods/services not mentioned in Point a1 of this Clause.

The seller shall concurrently send the invoices that contain adequate information to the buyers and the tax authority.”

6 Point a.1 Clause 3 Article 22 of the Decree No.123/2020/ND-CP stipulates: “In case of sale of oil and gas, the seller shall include data about every sales invoice issued to buyers in the day in the e-invoice datasheet which shall be sent to the tax authority within the same day.”

7 Clause 1 Article 14 of the Decree No.123/2020/ND-CP stipulates:

 “1. The following entities are not required to pay service charges for a period of 12 months from the date of commencement of the use of authenticated e-invoices:

a) Small- and medium-sized enterprises, cooperatives, household and individual businesses that operate in disadvantaged areas or extremely disadvantaged areas. Disadvantaged areas or extremely disadvantaged areas are defined in the List of areas eligible for investment incentives enclosed with the Government’s Decree No. 118/2015/ND-CP dated November 12, 2015 and its amending or superseding documents (if any).

b) Other small- and medium-sized enterprises which are defined according to the requests of the provincial People’s Committees submitted to the Ministry of Finance, except enterprises operating in economic zones, industrial parks or hi-tech zones.

The General Department of Taxation shall directly provide or entrust e-invoice service providers to provide free of charge authenticated e-invoices for the abovementioned entities.”