Question: Business A wants to inquire about the following scenario: in the case of purchasing input goods where the business has already paid but has not received the goods, what documents does the business need to include these expenses as reasonable when calculating corporate income tax?

Response:

- Based on Article 6 of Circular No. 78/2014/TT-BTC dated June 18, 2014, issued by the Ministry of Finance (amended and supplemented at Point 2.9 of Article 4 of Circular No. 96/2015/TT dated June 22, 2015):

"2.1. Expenses that do not meet the conditions prescribed in Clause 1 of this Article.

... In cases where the enterprise incurs expenses related to losses due to natural disasters, epidemics, fires, and other force majeure events that are not compensated, these expenses are included in deductible expenses when determining taxable income, as follows:

The enterprise must clearly determine the total value of losses due to natural disasters, epidemics, fires, and other force majeure events as prescribed by law.

The portion of the value of losses due to natural disasters, epidemics, fires, and other force majeure events that are not compensated is determined by subtracting the portion covered by insurance or other organizations or individuals as required by law."

- Based on Point 1 of Article 3 of Decree No. 126/NĐ-CP dated October 19, 2020, issued by the Government, which stipulates:

1. Taxpayers suffering material damage due to other force majeure reasons as stipulated in point b, clause 27, Article 3 of the Tax Administration Law, including: war, riots, strikes causing production cessation, inability to produce or trade, or risks not attributable to subjective responsibility of the taxpayer, and the taxpayer has no financial ability to contribute to the state budget.

Therefore, in cases where the enterprise suffers losses, determined to be force majeure, they will be recognized as deductible expenses when calculating corporate income tax.

Procedures and documentation for identifying the losses to be included in expenses are implemented according to the guidelines at Point 2.1, Article 6 of Circular No. 78/2014 (amended and supplemented by Circulars 119/2014/TT-BTC and 151/2014/TT-BTC).