Is it okay to miss an input invoice? Is there a penalty for not declaring an input invoice? Regulations and how to declare missed input invoices – with examples
Missing input invoice declaration is an issue that attracts the top attention of businesses. However, there are currently many documents guiding declarations for cases of missing input invoices with new regulations that make many businesses confused. Let’s join fdiinvietnam.com to learn more about the regulations on missing input invoice declaration in 2023 through this article.
I. What is a missed input invoice?
Omitted input invoices are cases where a business declares and deducts input value-added tax (VAT) incompletely compared to the actual invoice. Omitted input invoices that are not declared in a timely manner may affect the business’s tax obligations and cause difficulties for tax authorities in tax management and inspection.
II. Risks when businesses fail to declare input invoices
Missing input invoice declaration is a mistake that business accountants often encounter, posing many potential risks to businesses, such as:
- Enterprises are not allowed to deduct VAT, leading to financial losses;
- Enterprises cannot present documents proving the origin of products when tax authorities conduct inspections of input invoices for goods and services, leading to administrative violations regarding invoices and being fined for losing invoices;
- Enterprises may be penalized for tax evasion if the tax authority has sufficient evidence to prove that this is an act of revenue evasion.
III. Regulations and methods for declaring missing input invoices
To declare additional input invoices and correct errors accurately and in accordance with regulations, you need to carefully study the regulations and refer to some of the following legal documents:
- Circular No. 219/2013/TT-BTC;
- Law on Tax Administration No. 38/2019/QH14;
- Decree 126/2020/ND-CP;
- Some official dispatches instructing on declaring input invoices are omitted.
Detailed information on the regulations in the above documents is presented by fdiinvietnam.com below:
1. Circular No. 219/2013/TT-BTC
According to Clause 8, Article 14 of Circular No. 219/2013/TT-BTC, it is stipulated as follows:
- Input VAT arising in any period must be declared and deducted when determining the amount of VAT payable for that period, regardless of whether the goods have been exported for use or are still in inventory;
- If an enterprise discovers any errors in declaring or deducting input VAT, it can make a supplementary declaration before the tax authority announces the decision to conduct a tax inspection or audit.
>> See details: Circular No. 219/2013/TT-BTC guiding the Law on Value Added Tax.
2. Tax Administration Law No. 38/2019/QH14
According to Article 47 of the Tax Administration Law No. 38/2019/QH14, it is stipulated as follows:
- When a business discovers errors in the tax declaration submitted to the tax authority, the business is allowed to make a supplementary tax declaration that meets the following two conditions:
- Declare within 10 years from the deadline for submitting the tax return of the tax period in which the error occurred;
- Declare before the tax authority or competent authority decides to inspect or examine the enterprise.
- Enterprises can still supplement their tax declaration dossiers after the tax authority or competent authority announces the decision to conduct a tax inspection or examination. However, they will be subject to administrative penalties according to Articles 142 and 143 of the Tax Administration Law No. 38/20219/QH14.
>> See details: Tax Administration Law No. 38/2019/QH14.
3. Decree 126/2020/ND-CP
According to the provisions of Clause 4, Article 7 of Decree 126/2020/ND-CP, enterprises are allowed to submit supplementary declarations for each tax declaration when detecting errors or omissions according to the provisions of Article 47 of the Law on Tax Administration as follows:
- In case there is no change in tax obligations, the enterprise only needs to submit a supplementary declaration explanation along with related documents and certificates without having to submit a supplementary declaration;
- In case the year-end tax settlement dossier has not been submitted, the enterprise shall supplement the tax declaration dossier of the month or quarter in which the erroneous invoice arises;
- In case the annual tax settlement declaration has been submitted, the enterprise shall make a supplementary declaration for the annual tax settlement declaration;
- Enterprises that make additional declarations leading to an increase in the amount of VAT payable or a decrease in the amount of VAT refunded must pay the full amount of the increased tax payable or the amount of tax refunded in excess by the state budget and late payment fees (if any);
- If the additional declaration increases or decreases the amount of deductible VAT transferred to the next period (indicator [43] on the VAT declaration), the enterprise shall declare it in the current tax period;
- Enterprises are only allowed to declare additional VAT refunds when they have not yet submitted tax declarations for the next tax period and have not yet submitted VAT refund requests.
See also:
>> Decree 126/2020/ND-CP on guidelines for the Law on Tax Administration;
>> How to declare additional and adjust VAT declaration.
4. Some official dispatches guiding the declaration of input invoices were omitted.
4.1. Official dispatch No. 3059/TCT-KK
Official dispatch No. 3059/TCT-KK dated August 18, 2022 of the General Department of Taxation sent to Lam Dong Provincial Tax Department providing guidance on additional declaration of input VAT invoices as follows:
In the tax calculation period of October and November 2021, if the company discovers that the VAT invoices for purchased goods and services are missing (from January 2021 to September 2021) before the tax inspection and examination decision of the tax authority or competent authority, it shall make a supplementary declaration of input invoices according to the provisions of Point b, Clause 4, Article 7 of Decree No. 126/2020/ND-CP.
>> See details: Official dispatch 3059/TCT-KK guiding value added tax declaration.
4.2. Official dispatch No. 2397/CTBNI-KKKTT
Official dispatch No. 2397/CTBNI-KKKTT dated June 27, 2023 of the Bac Ninh Provincial Tax Department provides guidance on declaring missing input invoices as follows:
If the company discovers that input invoices from previous periods have not been declared, the company is allowed to make additional declarations according to the instructions in Article 47 of the Law on Tax Administration No. 38/2019/QH14 dated June 13, 2019 and Clause 4, Article 7 of Decree 126/2020/ND-CP.
Accordingly, the official dispatch stipulates that for any period where input VAT invoices are missed, additional input invoices of that period must be declared.
>> See details: Official dispatch No. 2397/CTBNI-KKKTT guiding on declaring missing input invoices.
IV. Deadline for declaring missing input invoices
According to the regulations fdiinvietnam.com mentioned above, when declaring an input VAT invoice incorrectly, the enterprise is allowed to declare and deduct additional amounts, but must declare before there is an inspection or examination decision by the tax authority or competent authority.
According to Circular 78/2021/TT-BTC, enterprises shall make additional declarations of input invoices as follows:
➤ Case before applying electronic invoices: Make additional declarations in the period when missing input invoices are discovered;
Example 1: In October 2021, fdiinvietnam.com company discovered that there was a missing input VAT invoice for April 2021. This invoice is applying electronic invoices according to Decree 51/2010/ND-CP, so the company will declare this additional invoice in the tax calculation period of the fourth quarter of 2021.
➤ Case after applying electronic invoices: Make additional declaration in the arising period of the missed input invoice.
Example 2: In November 2023, fdiinvietnam.com company discovered that it had misdeclared the input VAT invoice of June 2023. This invoice is applying the new electronic invoice according to Circular 78/2021/TT-BTC, so the company will make a supplementary declaration in the tax period of the second quarter of 2023.
See also:
>> Deadline for supplementary declaration of VAT declaration;
>> Instructions for determining the time of VAT declaration.
V. Questions related to missing input invoice declaration
1. How to handle missing input invoice declaration from previous year?
If the previous year’s input invoices are found to be undeclared, the enterprise can handle them as follows:
- Enterprises can supplement the declaration of input invoices omitted from the previous year at any time but must be before the tax authority decides to conduct a tax audit;
- Accounting for omitted input invoices in the year of occurrence, adjusting the costs of that year, not accounting for omitted input invoices in the current year because the costs of each year must be recorded in that year;
- Re-present the previous year’s financial statements to accurately reflect that year’s costs, profits and tax liabilities;
- Make a supplementary declaration of the previous year’s corporate income tax settlement to recalculate the tax payable.
See also:
>> How to handle incorrect invoices;
>> Cases of illegal invoice processing.
2. Will a company be fined if it does not declare input invoices?
Not declaring input invoices will have the following potential risks:
- VAT on purchased goods and services is not deductible;
- Administrative penalties for losing invoices may be imposed in case the tax authority inspects and the enterprise cannot present invoices or documents proving the origin of the goods;
- Tax evasion can be punished when the tax authority proves that this is an act aimed at evading the enterprise’s revenue.
>> See more: Penalties for using illegal invoices.
3. How to check if a business’s input invoices are complete?
Currently, all businesses have used electronic invoices according to Circular 78/2021/TT-BTC, so businesses can look up input invoices on the General Department of Taxation’s Electronic Invoice Portal at the link https://hoadondientu.gdt.gov.vn.