The Vietnam Government released its Decree covering E-invoices in Vietnam on 12 September 2018. Decree 119/2018/ND-CP (“Decree 119”) on Regulations for Electronic Invoices when Selling Goods or Providing Services, sets out instructions which compel enterprises in Vietnam to move to using E-invoices by 31 October 2020, and cease using paper VAT invoices.
Key highlights of Decree 119
- The Decree is effective from 1 November 2018, and applies to all enterprises in Vietnam.
- Enterprises that are registered for paper invoices prior to 1 November 2018 can continue to use these up until 31 October 2020.
- Enterprises already using E-invoices prior to 1 November 2018, will continue using the E-invoices and process as registered.
- Enterprises established from 1 November 2018 will be required to register and use E-invoices in accordance with this Decree and Tax Department guidelines.
- The new Decree removes reference to the VND200,000 transaction threshold that previously applied to issuing paper invoices.
- E-invoices can be printed and stored as paper invoices for recording and monitoring in accordance with the Law on Accounting, but when printed as paper invoices they are not valid for executing transactions or payments.
- Certain public institutions (for example, schools) can continue using receipts as they do at present, with the Ministry of Finance to issue guidance and timelines to convert to E-invoices / E-receipts.
- E-invoices are to follow the standard format as issued by the authorities, and managed by the tax authorities through the E-invoice database from the Tax Department.
- Requirements exist to destroy unused paper invoices, and submit summaries on prescribed forms of invoices issued/destroyed upon conversion to E-invoices or by the 31 October 2020 final conversion date.
Application of e-invoices, databases and tax authority verification codes
Enterprises and other organisations in the fields of electricity, petroleum, telecommunications, transportation, clean water, financial services, insurance, e-commerce, supermarkets, and other trading fields with high volumes of transactions can issue E-invoices without tax authority verification codes, where:
- enterprises transact with tax authorities electronically, and
- have sufficient computer infrastructure, accounting software and e-invoice software in accordance with regulations.
- Enterprises, other than those referred to above, will be required to issue E-invoices with tax authority verification codes. Verification codes are issued through the General Department of Taxation’s web portal when sellers digitally sign E-invoices using the web portal, or through valid software providers registered with and connected to the web portal.
- Certain Vietnamese authorities can access the web portal to verify goods in transit and similar activities, resulting in printer/paper invoices not being required to be on hand during transit.
- E-invoices are to be sent by sellers to buyers through electronic communication methods as agreed by both parties.