Uni 24-12-2013 - Guidance on implementation of some articles of Law on VAT

Decree No.209/2013/NĐ-CP issued by Government on18 December 2013 guiding implementation some articles of Law on VAT, effective from 01 January 2014 and replaces decree No.123/2008/NĐ-CP and 121/2011/NĐ-CP, eliminating clause 1 article 4 Decree No. 92/2013/NĐ-CP. In which, some spotlights should be noted as follows:

• Export goods and services applied to 0 % tax rate except the conditions of sale , provision to organizations and individuals in foreign countries must also meet consumption conditions out of Vietnam , in non-tariff zones.
• Housing meets the criteria for social housing under the provisions of the law to be applied at the tax rate of 5 %
• The business establishments have an annual turnover of less than 1 billion VND are subject to the direct calculation method to the added value , if they want to apply the tax deduction method ( except for households , business and individuals ) must meet the conditions : full implementation of accounting regulations , invoices, vouchers and voluntary registration applicable to withholding taxes.
• Newly established enterprises can register to apply the method of tax deduction . Where not registered, enterprises are applied to the direct method to the added value.
• Input VAT of fixed assets used for the production and trading of VAT-liable and non VAT – liable goods and services, only deduct the input VAT amounts used for production and trading of goods and services subject to VAT.
• The number of VAT amounts of each purchase more than 20 million VND or more without evidence of non-cash payments is not deducted, not accounted for in the deductible expense or the cost of the fixed assets.
• Business establishments in twelve consecutive months or continuous four quarters generated VAT is not deducted but will be refunded ( instead of 3 months as the previous regulations).
• The new structures, projects and business establishments have export goods or services will be refunded VAT if the accumulative VAT amounts of goods and services purchased used for investment or for export more than 300 million VND or more ( instead of 200 million as the previous regulations).