Circular No. 176/2016/TT-BTC Amending and Supplementing Certain Provisions of Circular No. 10/2014/TT-BTC dated January 17, 2014 of the Ministry of Finance on Administrative Sanctions for Violations Relating to Invoices

CIRCULAR

AMENDING AND SUPPLEMENTING CERTAIN PROVISIONS OF THE CIRCULAR NO. 10/2014/TT-BTC DATED JANUARY 17, 2014 OF THE MINISTRY OF FINANCE GUIDING ADMINISTRATIVE SANCTIONS FOR VIOLATIONS CONCERNING INVOICES

Pursuant to the Law on Handling Administrative Violations No. 15/2012/QH13 dated June 20, 2012;

Pursuant to the Law on Tax Administration No. 78/2006/QH11 dated November 29, 2006 and the Law Amending and Supplementing Certain Provisions of the Law on Tax Administration No. 21/2012/QH13 dated November 20, 2012;

Pursuant to Decree No. 81/2013/NĐ-CP dated July 19, 2013 of the Government detailing certain provisions and measures for implementing the Law on Handling Administrative Offenses;

Pursuant to the Government Decree No. 51/2010/NĐ-CP dated May 14, 2010 on invoices for goods and services; the Government Decree No. 04/2014/NĐ-CP dated January 17, 2014 amending and supplementing certain provisions of the Government Decree No. 51/2010/NĐ-CP dated May 14, 2010 on invoices for goods and services;

Pursuant to the Government Decree No. 109/2013/NĐ-CP dated September 24, 2013 on administrative sanctions for violations in price, fee, and invoice management; the Government Decree No. 49/2016/NĐ-CP dated May 27, 2016 amending and supplementing certain provisions of the Government Decree No. 109/2013/NĐ-CP dated September 24, 2013 on administrative sanctions for violations in price, fee, and invoice management;

Pursuant to Decree No. 215/2013/NĐ-CP dated December 23, 2013, promulgated by the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

At the proposal of the Director General of the State Revenue Administration,

The Minister of Finance guides the amendment and supplementation of certain provisions of Circular No. 10/2014/TT-BTC dated January 17, 2014 of the Ministry of Finance guiding administrative sanctions for violations concerning invoices as follows:

Article 1. Amending and supplementing certain provisions of Circular No. 10/2014/TT-BTC dated January 17, 2014 of the Ministry of Finance guiding administrative sanctions for violations concerning invoices as follows:

1. Amending and supplementing Clause 1, Clause 6, and adding Clause 2a to Article 7 as follows:

“1. The act of printing invoices without signing a written printing contract.

a) A fine from 500.000 VND to 1.500.000 VND for both the party placing the order for printing and the party receiving the order for printing invoices for the act of printing invoices without signing a written printing contract or an organization receiving orders for printing invoices printing the ordered invoices for self-use but without a decision to print invoices issued by the head of the unit as prescribed.

The printing contract for invoices must be in writing in accordance with the Civil Code, and the decision to print ordered invoices by the organization receiving the order for printing must be in writing and contain all necessary contents as guided in the Circular of the Ministry of Finance on invoices for goods and services.

b) In cases where a printing contract has been signed in writing but the contract does not contain all necessary contents or the organization receiving the order for printing invoices prints the ordered invoices based on a decision to print invoices that does not contain all necessary contents as guided in the Circular of the Ministry of Finance on invoices for goods and services, then:

b.1) A warning shall be imposed on the case where the party placing the order for printing and the party receiving the order for printing invoices have signed a supplementary agreement to include the missing contents, and the organization receiving the order for printing invoices has signed a supplementary decision to include the missing contents before the tax authority announces its inspection or audit decision.

b.2) A fine at the minimum level of the fine range of 500,000 VND VND shall be imposed on the case where the party placing the order for printing and the party receiving the order for printing invoices do not sign a supplementary agreement to include the missing contents, and the organization receiving the order for printing does not sign a supplementary decision to include the missing contents. At the same time, the party placing the order for printing and the party receiving the order for printing invoices must supplement the missing contents in the contract.”

“2a. A fine from 2,000,000 VND to 4,000,000 VND for the act of printing invoices when the tax authority has issued a written notice to organizations and businesses that they do not meet the conditions to print invoices, except in cases where the tax authority does not issue a written opinion when receiving a request to use printed invoices from organizations and businesses in accordance with the guidance of the Ministry of Finance.”

“6. Measures to remedy consequences: Organizations and individuals violating the provisions of the Clause 2a, Clause 4 and Clause 5 of this Article must cancel the improperly printed invoices.”

2. Adding Clause 1a to Article 10 as follows:

“1a. A fine from 500.000 VND to 1.500.000 VND for one of the following acts:

a) Submitting a notification to adjust information in the invoice issuance announcement to the direct tax administration agency and submitting a list of unused invoices to the tax office at the new location within 10 days from the start of using invoices at the new address when a business changes its business address leading to a change in the direct tax administration agency..

b) Using invoices that have been announced for issuance to the tax authority but are not yet due for use (five days from the date of sending the issuance announcement).”

3. Adding Point c to Clause 1 Article 10 as follows:

“1. A fine from 2,000,000 VND to 4,000,000 VND for one of the following acts:

a) Issuing an incomplete invoice issuance announcement according to the regulations which has been discovered by the tax authority and notified to the organization or individual to correct, but the organization or individual has not corrected it and issued invoices to customers.

If there are mitigating circumstances, the fine will be at the minimum level of the fine range, which is 2,000,000 VND.

b) Not posting the invoice issuance announcement as required.

Posting the invoice issuance announcement shall be carried out in accordance with the Circular of the Ministry of Finance on invoices for goods and services.

If there are mitigating circumstances, the fine will be at the minimum level of the fine range, which is 2,000,000 VND.

c) Submitting a notification to adjust information in the invoice issuance announcement to the direct tax administration agency and submitting a list of unused invoices to the tax office at the new location within 20 days from the start of using invoices at the new address when a business changes its business address leading to a change in the direct tax administration agency..”

4. Adding Point g to Clause 3 Article 11 as follows:

“g) Losing, burning, or damaging issued invoices but not yet recorded or issued invoices but not yet received by the customer when the invoices have not reached their retention period; or issued invoices according to a retail sales list; except in cases of loss, burning, or damage caused by natural disasters, fire, or unexpected events, force majeure, then no fine shall be imposed. In cases of losing, burning, or damaging issued invoices (customer copy), the seller and buyer shall prepare a record of the incident, the seller has declared and paid taxes, has contracts and evidence proving the sale of goods or services, and if there is one mitigating circumstance, the fine will be at the minimum level of the fine range; if there are two mitigating circumstances, a warning shall be imposed.

In case the invoice (the copy handed over to the customer) is lost, burned, or damaged ,both the seller and buyer shall prepare a record acknowledging the incident. If the seller has declared and paid taxes, possesses a sales contract and proof of the transaction, and there is one mitigating circumstance, then the penalty shall be at the minimum level of the fine range; if there are two or more mitigating circumstances, then a warning shall be issued.

In the event that invoices, except for the copy given to the customer, are lost, burned, or damaged during the retention period, penalties shall be imposed in accordance with the accounting laws.

If the seller recovers the lost invoice (the copy given to the customer) before the tax authority issues a penalty decision, the seller will not be fined.

In the case where the seller loses, burns, or damages all copies of incorrectly issued invoices that have been deleted (the seller has issued another invoice to replace the incorrectly issued and deleted invoices), the seller will be subject to a warning penalty.

Where, at the same time, organizations or individuals report the loss of multiple invoices to the tax authority but the tax authority has sufficient grounds to determine that the organization or individual is grouping multiple losses of invoices to report to the tax authority, penalties shall be imposed for each loss of invoice.

In the event that issued invoices (the copy given to the customer) are lost, burned, or damaged, involving a third party hired by the seller, the seller shall be penalized according to this provision.

5. Repeal point a and amend Clause 4 of Article 11 as follows:

“4. A fine of VND 10,000,000 to VND 20,000,000 shall be imposed on the act of not issuing an invoice when selling goods or services with a payment value of VND 200,000 or more to the buyer a) Receive and manage IDP data updated from Departments of Transport to synchronize with the IDP management information system; Along with the imposition of penalties, organizations and individuals engaged in business must issue an invoice to the buyer.”

6. Amend and supplement Clause 1 of Article 12 as follows:

“1. A fine of VND 4,000,000 to VND 8,000,000 shall be imposed on the act oflosing, burning, or damaging issued invoices (the copy given to b) Loan amount; credit limit for cases of credit based on a limit;) for accounting records, tax declaration, and budget disbursement; except in cases of loss, burning, or damage due to natural disasters, fire the seller and buyer shall prepare a record of the incident, the seller has declared and paid taxes, has contracts and evidence proving the sale of goods or services, and if there is one mitigating circumstance, the fine will be at the minimum level of the fine range; if there are two mitigating circumstances, a warning shall be imposed.

In case the invoice (the copy handed over to the customer) is lost, burned, or damaged (the copy given to b) Loan amount; credit limit for cases of credit based on a limit;)both the seller and buyer shall prepare a record acknowledging the incident. If the seller has declared and paid taxes, possesses a sales contract and proof of the transaction, and there is one mitigating circumstance, then the penalty shall be at the minimum level of the fine range; if there are two or more mitigating circumstances, then a warning shall be issued.

In the case where the person purchase recovers the lost invoice and reports it back to the tax authority before the tax authority issues a penalty decision, the person purchase will not be fined.

Where, at the same time, organizations or individuals report the loss of multiple invoices to the tax authority but the tax authority has sufficient grounds to determine that the organization or individual is grouping multiple losses of invoices to report to the tax authority, penalties shall be imposed for each loss of invoice.

In the event that issued invoices (the copy given to the customer) are lost, burned, or damaged, involving a third party hired by the buyer, the buyer shall be penalized according to this clause.

In the event that issued invoices are lost (the copy given to the customer) during the retention period, penalties shall be imposed in accordance with the accounting laws.”

7. Amend and supplement Clause 1, Clause 2, and add Clause 4 to Article 13 as follows:

“1. A fine of VND 200,000 to VND 1,000,000 shall be imposed on the act of incorrectly or incompletely filling out notifications or reports in accordance with regulations sent to the tax authority, except for the notification of invoice issuance.

In the case where organizations or individuals voluntarily discover errors and reissue the correct notifications or reports in compliance with regulations and send them to the tax authority before the tax authority or competent authority issues a tax inspection decision or conducts a tax audit at the taxpayer's premises, they will not be fined.

2. For violations related to the submission of notifications or reports to the tax authority, except for the notification of invoice issuance:

a) A warning penalty shall be imposed on the act of submitting notifications or reports to the tax authority, except for the notification of invoice issuance from the first day to the last day 10 within the prescribed deadline.

b) A fine of VND 2,000,000 to VND 4,000,000 shall be imposed, except for the notification of invoice issuance, if submitted late by more than 10 days after the prescribed deadline.

3. A fine of VND 4,000,000 to VND 8,000,000 shall be imposed for the act of failing to submit notifications or reports to the tax authority. The act of failing to submit notifications or reports to specialized agency under the People's Committee of the province/city.the tax authority, except for the notification of invoice issuance, shall be considered after 20 days from the end of the prescribed deadline.

4. Measures to rectify consequences: Organizations or individuals violating Clause 1 of this Article must reissue and resubmit the correct notifications or reports to the tax authority.

Article

1. This Circular takes effect from the date December 15, 2016.

2. Other provisions regarding administrative penalties for violations concerning invoices not specified in this Circular shall be implemented in accordance with the Law on Handling Administrative Violations, Circular No. 10/2014/TT-BTC dated January 17, 2014 of the Ministry of Finance and related detailed regulations.

Article

1. Tax authorities at all levels are responsible for disseminating and guiding organizations, individuals engaged in business, non-business activities, and buyers of goods and services to comply with the guidelines set forth in this Circular, inspecting and handling violations by organizations and individuals using invoices in a consistent manner throughout the industry, in accordance with the law.

2. Organizations and individuals involved in the printing, issuance, and use of invoices must fully comply with the contents outlined in this Circular.

During the implementation process, if there are difficulties, organizations and individuals are requested to promptly reflect to the Ministry of Finance for research and resolution./.