|Update:||Compliance Alert – VAT temporary reduction according to Decree No. 15/2022/ND-CP is over|
The VAT rate reduction from 10% to 8%, imposed by Decree No. 15/2022/ND-CP (Decree 15) in 2022 for given goods and services, ended on 31 December 2022.
Therefore, since 1 January 2023, the VAT has returned to its regular rate of 10%.
The local tax authorities explain how to proceed with the termination of the reduction:
- How to correct invoices for goods and services provided and invoiced before 31 December 2022?
Whether a taxpayer adjusts the output invoices issued for goods or services eligible for VAT reduction in 2022, the referred invoice must use the VAT rate of 8%, states the official letter No. 6778/CTHN-TTHT of the Hanoi City Tax Department.
- How to return invoices for goods purchased between February and December 2022?
The same official letter also states that if goods subject to 8% VAT under Decree 15 are returned, the company will issue the return invoice at the rate of 8%.
- How to proceed if the provision was completed in 2022 but invoiced in 2023?
Most local tax authorities are consistent that all goods and services eligible for the VAT rate reduction based on Decree 15, must apply a 10% VAT rate from January 2023, including those performed in 2022 but invoiced in 2023.
It is important to know that penalties may be charged on taxpayers invoicing at the wrong time.