On March 28, 2022, the new work was carried out on the 3rd payment volume. Ms. Trinh asked, the 3rd payment volume, the company can issue an 8% value-added tax (VAT) invoice according to Decree No. 15/2022/ND-CP of the Government (the first and second payment volumes are in 2021 and the VAT rate is 10%)?

The Tax Department of Quang Ngai province responded to this problem as follows:

In Article 1 of the Government's Decree No. 15/2022/ND-CP dated January 28, 2022 on VAT reduction as follows:

"Article 1. VAT reduction

1. Reduced VAT for groups of goods and services currently applying the 10% tax rate, except for the following groups of goods and services:

a) Telecommunications, financial activities, banking, securities, insurance, real estate trading, metals and prefabricated metal products, mining products (excluding coal mining), coke, refined petroleum, chemical products. Details are in Appendix I issued together with this Decree.

b) Products, goods and services subject to excise tax. Details are in Appendix II issued together with this Decree.

c) Information technology according to the law on information technology. Details are in Appendix III issued with this Decree.

d) The reduction of VAT for each type of goods and services specified in Clause 1 of this Article is uniformly applied at the stages of import, production, processing, business and trade. For the sold coal mined (including the case of coal mined and then screened and classified according to a closed process to be sold) which is subject to VAT reduction. Coal products listed in Appendix I to this Decree are not eligible for VAT reduction at other stages other than mining.

… 2. VAT reduction

a) Business establishments that calculate VAT by the credit method may apply the VAT rate of 8% for goods and services specified in Clause 1 of this Article.

… 3. Order and procedures for implementation

a) For business establishments specified at Point a, Clause 2 of this Article, when making VAT invoices providing goods and services eligible for VAT reduction, write "8%" at the VAT rate line; VAT amount; total amount to be paid by the buyer. Based on VAT invoices, business establishments selling goods and services shall declare output VAT, and business establishments purchasing goods and services shall declare and deduct input VAT according to the reduced tax amount stated on the invoice. VAT…".

In Article 8 of Circular No. 219/2013/TT-BTC dated December 31, 2013 of the Ministry of Finance stipulating the time of VAT determination as follows:

"Article 8. Time of VAT determination

1. For the sale of goods, it is the time when the ownership or the right to use the goods is transferred to the buyer, regardless of whether the money has been collected or not.

2. For service provision, it is the time when the service is completed or the service provision invoice is issued, regardless of whether money has been collected or not.

… 5. For construction and installation, including shipbuilding, is the time of acceptance, handover of works, work items, completed construction and installation volumes, regardless of whether money has been collected or have not received the money…”.

In Clause 2, Article 16 of Circular No. 39/2014/TT-BTC dated March 31, 2014 of the Ministry of Finance, the date of invoice issuance is as follows:

"Article 16 Invoicing

… 2. How to set up some specific criteria on invoices

a) Criteria "Date Month Year" invoicing

The invoice date for the sale of goods is the time when the ownership or the right to use the goods is transferred to the buyer, regardless of whether the money has been collected or not.

The invoice date for a service is the date on which the service is completed, regardless of whether payment has been received or not. In case a service-providing organization collects money before or during service provision, the invoice date is the date of payment.

… The date of invoice for construction and installation is the time of acceptance, handover of works, work items, completed construction and installation volume, regardless of whether money has been collected or not.

In case of multiple delivery or handover of each service item or stage, each delivery or handover must issue an invoice for the corresponding volume and value of the delivered goods and services.

In Article 9 of Decree No. 123/2020/ND-CP dated October 19, 2021 of the Government stipulating the time of making invoices as follows:

"Article 9. Time of invoicing

1. The time of making invoices for the sale of goods (including the sale of state assets, confiscated properties, replenishment of state funds and sale of national reserve goods) is the time of transfer of ownership or use rights, regardless of whether money has been collected or not.

2. Time of invoicing for service provision is the time of completion of service provision, regardless of whether money has been collected or not. In case the service provider collects money before or while providing the service, the time of making an invoice is the time of collecting money (excluding the case of collection of deposits or advances to ensure the performance of contracts for the provision of services: accounting, auditing, financial consulting, tax; valuation; survey, technical design; supervision consultants; setting up a construction investment project).

… 4. Invoice time for some specific cases is as follows:

… c) For construction and installation activities, the time of invoice issuance is the time of acceptance and handover of works, work items, completed construction and installation volumes, regardless of receipted money or not received money…”.

On March 23, 2022, the Ministry of Finance issued Official Letter No. 2688/BTC-TCT guiding VAT in Decree No. 15/2022/ND-CP of the Government.

Pursuant to the above provisions and the content of the question of Ms. Nguyen Thi Thu Trinh, in case her company generates VAT calculation revenue from construction activities that are not on the list of goods and services not eligible for tax reduction, VAT according to the detailed provisions in Appendix I, II, III issued together with Decree No. 15/2022/ND-CP of the Government, the VAT rate of 8% shall be applied to tax calculation business establishments. VAT by the deduction method from February 1, 2022 to the end of December 31, 2022.

The time to determine VAT of construction activities is the time of acceptance, handover of works, work items, completed construction volumes, regardless of whether money has been collected or not as prescribed in Clause 1 of this Article. Clause 5, Article 8 of Circular No. 219/2013/TT-BTC of the Ministry of Finance.

Nguyen Thi Thu Trinh is requested to base on the above provisions and the guidance of the Ministry of Finance in Official Letter No. 2688/BTC-TCT, compare with the actual goods and services arising at the unit and at the time of confirmation. determine VAT in order to reduce VAT in accordance with the provisions of law.