Latest regulations on non-cash payments: What are non-cash payment documents and what do they include? What is their role in deducting input VAT and determining deductible expenses when calculating corporate income tax?
What is a payment voucher?
Learning what a payment voucher is will help you better understand what a non-cash payment voucher is.
Payment voucher is a term used to refer to a type of document or object containing information reflecting a certain financial and economic transaction that has been completed and is used as a basis for making payments.
What is a non-cash payment voucher?
As the name suggests, a non-cash payment voucher is a type of paper or document used to record information about payments for the purpose of purchasing services and goods according to the provisions of tax management law, but not paid in cash but paid through other means such as: bank cards, collection orders, payment orders or payment orders, checks, etc.
What is the role of non-cash payment vouchers?
According to Circular 26/2015/TT-BTC, non-cash payment documents serve as the basis for determining conditions for input value-added tax (VAT) deduction and deductible expenses when calculating corporate income tax (CIT), specifically:
1. For input VAT deduction
One of the conditions for enterprises to be able to deduct input VAT is to have non-cash payment documents for purchased services and goods (including imported goods) with a value of VND 20,000,000 or more (including VAT), except in the following cases:
- Imported goods and services each time have a value of less than 20,000,000 VND;
- Services and goods purchased each time according to invoice value under 20,000,000 VND (including VAT);
- Business establishments import goods as gifts from foreign individuals and organizations.
Note:
In case a business establishment purchases services or goods with a value of less than VND 20,000,000 but purchases multiple times in the same day from the same supplier (*) with a total value of VND 20,000,000 or more, it can still deduct input value-added tax if there is a payment document via bank.
(*): The supplier here is a taxpayer with a separate tax code, directly performing the procedures for declaring and paying VAT according to regulations. In case the taxpayer is a business establishment with stores as dependent units, each store will be a supplier, if:
- These stores share the same invoice form and tax code with the business;
- The invoice has the stamp of each store and uses the criterion “Store number” to distinguish the stores.
>> See details: Conditions for input VAT deduction.
2. For determining deductible expenses when calculating taxable income of corporate income tax
Pursuant to Article 4, Circular 96/2015/TT-BTC, for expenses with invoices for purchasing services and goods each time with a value of VND 20,000,000 or more (price including VAT) with non-cash payment documents, enterprises will be deducted when determining taxable income of CIT.
>> See details: Deductible expenses when calculating corporate income tax.
What are the classifications of non-cash payment documents?
Non-cash payment vouchers are currently classified as follows:
- Bank payment documents;
- Other non-cash payment documents.
1. Bank payment documents
It can be understood that a bank payment document is a type of document that records the transfer of money from the buyer’s account to the seller’s account. And these accounts are opened at organizations that provide payment services according to payment methods in accordance with current legal regulations.
Bank payment documents can be:
- Phone SIM (electronic wallet), credit card, bank card, collection order, collection order, payment order or payment order, check;
- Other forms of payment as prescribed, including cases where the buyer pays from the buyer’s account to the seller’s account, in which the buyer’s account or the seller’s account is in the name of the private enterprise owner.
2. Other non-cash payment documents
In addition to bank payment documents, there are other non-cash payment cases that are also recorded when deducting input VAT such as:
- Enterprises purchase goods and services by offsetting the value of purchased goods and services with the value of sold goods and services or by borrowing goods. To be recognized when deducting VAT, this payment method must ensure the following conditions:
- As specified in the contract;
- There is a confirmed data reconciliation record of payments between the two parties.
- Services and goods purchased by enterprises through debt offset methods such as borrowing money, lending money or offsetting debt through a third party. This payment method must ensure that the following conditions are met:
- As specified in the contract;
- There is a loan contract, borrowing money in written form established in advance;
- For cash loans, there must be a document of money transfer from the lender’s account to the borrower’s account (including cases where the value of purchased goods and services is offset against the amount of money that the seller has asked the buyer to pay on his behalf or the seller supports the buyer).
- Purchased goods and services are paid for by the enterprise by authorizing a third party to pay via bank. The conditions that this payment method must ensure to be recorded when deducting VAT include:
- Payment methods are clearly stated in the contract;
- A third party is a natural person or legal entity operating in accordance with the provisions of current law.
- Enterprises purchase services and goods by payment via bank into a third-party account opened at the State Treasury, in order to enforce the seizure of assets and money held by other individuals and organizations (according to the decision of a competent state agency).
Note:
If after making the above payment methods, the remaining value paid in cash is worth VND 20 million or more, tax deduction is only allowed in cases where there is a payment document via bank.
Frequently asked questions about cashless payment vouchers
1. What is a non-cash payment voucher?
Non-cash payment vouchers are a type of paper or document used to record information about payments by businesses for the purpose of purchasing services and goods according to the provisions of tax management law, but not paid in cash but paid through other means such as: bank cards, checks, payment orders or payment authorizations, collection authorizations, etc.
2. When can a company with non-cash payment documents deduct input VAT?
Enterprises with non-cash payment documents are entitled to deduct input VAT if such payment documents are payment documents for the purchase of goods and services (including imported goods) with a value of VND 20,000,000 or more (including VAT), except in the following cases:
- Imported goods and services each time have a value of less than 20,000,000 VND;
- Services and goods purchased each time according to invoice value under 20,000,000 VND (including VAT);
- Business establishments import goods as gifts from foreign individuals and organizations.
3. What types of non-cash payment documents are there?
Non-cash payment documents currently include:
- Bank payment documents;
- Non-cash payment documents in cases such as:
- Purchased goods and services are paid for by the enterprise by authorizing a third party to pay through the bank;
- Services and goods purchased by businesses through debt offset methods such as borrowing money, lending money, offsetting debt through a third party, etc.
>> For details, see: Non-cash payment documents – Detailed classification.
4. What is a non-cash payment voucher used for?
Non-cash payment documents play a role in determining the conditions for input VAT deduction and deductible expenses when calculating corporate income tax.
>> See details: The role of non-cash payment documents.
5. What are the bank payment documents?
Payment documents via bank can be phone sim (electronic wallet), credit card, bank card, collection order, collection order, payment order or payment order, check or other forms of payment according to current law.
Call us at 0978 578 866 (North) – 033 9962 333 (Central) – 033 9962 333 (South) for support.