VAT Refund, or Value-Added Tax Refund, is a process where the state refunds businesses and companies a sum of money they have previously paid in taxes. Today, Bach Hoa XANH will introduce you to the latest VAT refund procedures for 2021. Let’s find out together!
1. What is a VAT Refund?
A VAT refund is when the state budget repays businesses for taxes they have overpaid.
VAT Refund, or Value-Added Tax Refund, is the repayment by the state budget to businesses for taxes they have overpaid on goods and services purchased for their production and trading activities. This occurs when the input tax amount that the business has already paid when purchasing goods and services exceeds the output tax amount calculated for the same tax period. The business then receives a refund for the difference.
The VAT refund process is determined for each period and has specific regulations regarding the documentation required for the refund procedure.
2. VAT Refund Conditions
Businesses must have a VAT credit of at least 200,000,000 VND to be eligible for a refund.
To be eligible for a VAT refund, businesses must meet the following requirements:
- The business must have a continuous VAT credit and a VAT credit balance of at least 300,000,000 VND.
- All input documents of the business must be valid and comply with the law.
- The business must make full payments through the bank for each import and export order with a value of over 20,000,000 VND.
- Each import and export order must have a clear payment method and separate financial invoices.
3. VAT Refund Procedure
The VAT refund procedure is simple, but it is important for businesses to understand it thoroughly for a smooth and quick process. The procedure is specified in the Circular No. 156/2013/TT-BTC. The following are the key points to note:
Step 1: Prepare the Documents
The documents required for a VAT refund include a request letter and supporting documents.
The documents required for a VAT refund application are as follows:
– A request letter for the refund of budget revenue.
– Supporting documents such as purchase and sale contracts, customs declarations, bank payment documents, etc.
Step 2: Submit the Documents
Submit the documents to the authorized tax authorities.
Once the documents are ready, the business must submit them to the directly managing tax authorities or authorized customs authorities for VAT refund.
The submission can be done electronically or in person at the tax office, or by postal mail.
Step 3: Process the VAT Refund Request
After receiving the documents, the Tax Department will issue an order for the refund of budget revenue.
The process for handling VAT refund requests is specified in Clause 1, Article 59 of Circular No. 156/2013/TT-BTC.
After submitting the necessary documents to the authorized tax authorities, the Tax Department will issue an Order for the Refund of Budget Revenue and an Order for the Refund and Offset of Budget Revenue, which will be sent to the state budget authority as per the law.
Step 4: Time Limit for VAT Refund
Businesses that comply with the law will receive the refund first and be inspected later.
After reviewing the documents and the VAT refund request, the tax authorities will decide on the time limit for the refund.
Refund first, inspect later: This option is for businesses that have a good track record of complying with the law. The time limit for this option is 15 working days from the date of receiving the complete VAT refund application.
Inspect first, refund later: This option is for businesses that are applying for a refund for the first time or the second time, and their documents require further examination and supplementation. The time limit for this option is 60 days from the date of receiving the complete application.
Step 5: Post-Refund Inspection of the Taxpayer
The VAT refund will be processed according to the law, and any discrepancies will be addressed.
After the time limit for the VAT refund has passed, the tax authorities will process the refund for the businesses.
Following the VAT refund, an inspection will be conducted. If any discrepancies are found in the tax amount, the tax authorities may issue a decision to recover the refunded amount and impose penalties on the business according to the law.
Detailed Guide on How to Create an Online Individual Income Tax Return Profile
Get a Tax Refund When You Have Overpaid Your Income Tax. As an individual with a labor contract, you are required to pay annual income tax. Follow the article below to understand how to conveniently and quickly file for an online personal income tax refund.
