Circular No. 32/2011/TT-BTC guiding the creation, issuance, and use of electronic invoices for selling goods and providing services

CIRCULAR

Guidelines on the creation, issuance, and use of electronic invoices for selling goods and providing services

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Pursuant to the Law on Tax Administration dated November 29, 2006;

Pursuant to the Accounting Law dated June 17, 2003 and related guiding documents;

Pursuant to the Electronic Transactions Law dated November 29, 2005, Decree No. 27/2007/NĐ-CP dated February 23, 2007 on electronic transactions in financial activities, and Decree No. 35/2007/NĐ-CP dated March 8, 2007 on electronic transactions in banking activities;

Pursuant to Decree No. 51/2010/NĐ-CP dated May 14, 2010 of the Government on invoices for selling goods and providing services;

is a medicine production facility certified by the competent authority of a country participating in the EMA or ICH or PIC/s to meet EU-GMP or PIC/s-GMP standards or equivalent, and announced by the Ministry of Health (Drug Administration Department) on the Drug Administration Department's electronic information website.

The Ministry of Finance issues guidelines on the creation, issuance, use, and management of electronic invoices when selling goods and providing services as follows:

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

This Circular guides on the creation, issuance, use, and management of electronic invoices when selling goods and providing services.

Article 2. Applicability

This Circular applies to:

- Organizations and individuals choose to use electronic invoices when buying and selling goods and providing services.

- An intermediary organization providing electronic invoice solutions is an organization that provides support solutions for the creation, transmission, receipt, storage, and recovery of electronic invoice data messages between sellers and buyers.

- Tax administration authorities at all levels and organizations and individuals related to the creation, issuance, and use of electronic invoices.

Article 3. Electronic Invoice

1. An electronic invoice is a set of electronic data messages about selling goods and providing services, created, issued, sent, stored, and managed through electronic means. An electronic invoice must comply with the contents prescribed in Article 6 of this Circular.

An electronic invoice is created, issued, and processed on a computer system of an organization that has been assigned a tax code when selling goods and services and is stored on computers of the parties according to the laws on electronic transactions.

Electronic invoices include export invoices; value-added tax invoices; sales invoices; other invoices such as stamps, tickets, cards, receipts for insurance payments... air cargo payment receipts, international transportation fee collection documents, service fee collection documents from banks..., their forms and contents are established according to international practices and relevant laws.

An electronic invoice ensures the principle of being uniquely identified by a continuous and chronological numbering system, each invoice number can only be issued and used once.

2. An invoice that is initially created on paper but subsequently processed, transmitted, or stored using electronic means is not considered an electronic invoice.

3. An electronic invoice has legal validity if it satisfies the following conditions simultaneously:

a) There is sufficient assurance regarding the integrity of the information contained in the electronic invoice from the time the final form of the electronic invoice is created.

The criteria for assessing integrity are that the information remains complete and unchanged, except for changes in format arising during the exchange, storage, or display of the electronic invoice.

b) The information contained in the electronic invoice can be accessed and used in its entirety when necessary.

Article 4. Principles of Use and Conditions for Organizations Creating Electronic Invoices

1. Principles of Using Electronic Invoices

When a seller chooses to use an electronic invoice for selling goods or providing services, the seller is responsible for informing the buyer about the format of the electronic invoice and the method of transmitting the electronic invoice between the seller and the buyer (specifying whether the transmission is direct from the seller's system to the buyer's system; or the seller uses the intermediary system of an organization providing electronic invoice solutions to create and transmit the invoice to the buyer).

The seller, buyer, intermediary organization providing electronic invoice solutions (if through an intermediary), and related units must agree on technical requirements and conditions ensuring the integrity and security of the electronic invoice.

2. Conditions for Organizations Creating Invoices

A seller of goods or services (referred to collectively as the seller) creating an electronic invoice must meet the following conditions:

a) It is an economic entity that meets the conditions and is conducting electronic transactions for tax declaration with the tax authority; or an economic entity that uses electronic transactions in banking activities.

b) It has locations, information transmission channels, information networks, and communication devices that meet the requirements for operating, controlling, processing, using, preserving, and storing electronic invoices.

c) It has a team of personnel with the appropriate qualifications and capabilities to perform the tasks of creating, issuing, and using electronic invoices as prescribed.

d) It has an electronic signature as required by law.

đ) It has sales software connected to accounting software, ensuring that the data of electronic invoices for selling goods and providing services is automatically transferred into the accounting software (or database) at the time of invoice issuance.

e) It has data backup, data recovery, and data storage procedures that meet the minimum quality requirements for storage, including:

- The data storage system must meet or be proven to be compatible with data storage standards.

- There must be a data backup and recovery procedure when the system encounters problems: ensuring that electronic invoice data is backed up onto portable media or backed up online in full.

Article 5. Conditions for intermediary organizations providing electronic invoice solutions

Intermediary organizations providing electronic invoice solutions must meet the following conditions:

- Be a business operating in Vietnam with a Business Registration Certificate or Investment Certificate or Investment License of a foreign-invested enterprise in the information technology sector, or be a bank providing electronic transaction services in banking activities.

- Have software programs for initiating, creating, and transmitting electronic invoices to ensure that the electronic invoices created comply with the contents stipulated in Article 6 of this Circular.

- Have implemented a system providing information technology solutions to facilitate electronic data exchange between businesses or among organizations.

- Possess equipment and technical systems ensuring the provision of electronic invoice solutions meeting business requirements and legal regulations on issuing invoices.

- Have the ability to detect, warn, and prevent unauthorized access and various forms of attacks on the network environment to ensure the confidentiality and integrity of exchanged data between parties involved.

- Implement backup procedures for data, online data backup, and data recovery; have measures to address issues related to data recovery.

- Have solutions to store results of transmissions between participating parties in transactions; store electronic invoices with the requirement that electronic data messages must be retained on the system.

- Every six months, intermediary organizations providing electronic invoice solutions must submit a report to the tax authority (in Form No. 3 attached to this Circular) containing the following information: list of businesses using the organization's electronic invoice solution (including both sellers and buyers); number of invoices used (including: type of invoice, invoice code, model code, serial number).

Article 6. Contents of Electronic Invoices

1. Electronic invoices must include the following contents:

a) Name of invoice, invoice code, model code, serial number of invoice; The invoice code, model code, and serial number on the invoice shall be carried out according to the provisions in Appendix No. 1 of Circular No. 153/2010/TT-BTC of the Ministry of Finance.

b) Name, address, taxpayer identification number of the seller;

c) Name, address, taxpayer identification number of the buyer;

d) Name of goods or services; unit of measurement, quantity, unit price of goods or services; total amount recorded in figures and in words.

For value-added tax invoices, in addition to the unit price which does not include value-added tax, there must be a line indicating the VAT rate, VAT amount, and total payment amount recorded in figures and in words.

e) Electronic signature of the seller in accordance with the law; date, month, year of issuance and transmission of the invoice. Electronic signature of the buyer in accordance with the law when the buyer is an accounting unit.

g) The invoice must be presented in Vietnamese. If additional foreign language text is required, the foreign language text should be placed in parentheses ( ) to the right or directly below the Vietnamese text and in smaller font size. The digits recorded on the invoice are natural numbers: 0, 1, 2, 3, 4, 5, 6, 7, 8, 9; a period (.) must be placed after thousands, millions, billions, trillions, quadrillions, quintillions; if there are digits after the units place, a comma (,) must be placed after the units place. In cases where there is no specific agreement between the buyer and seller regarding the language used in the creation of electronic invoices for exporting goods or services, the language used on the electronic invoice (export invoice) shall be English.

If the decimal separator is a comma (,) after thousands, millions, billions, trillions, quadrillions, quintillions and the digit separator is a period (.) after the units place, the organization initiating the electronic invoice must clearly state this in the Notice of Issuance of Electronic Invoice.

The contents specified from point b to point d of Clause 1 of this Article must reflect the nature and characteristics of the business industry, identify the economic activity generated, the amount received, identify the buyer (or payer, service beneficiary...), the seller (or service provider...), name of goods or services - or the content of the payment.

2. In certain cases where electronic invoices do not fully contain all mandatory contents, they shall be implemented according to separate guidelines issued by the Ministry of Finance.

Chapter II

INITIATION, ISSUANCE AND USE OF ELECTRONIC INVOICES

Article 7. Creation and Issuance of Electronic Invoices

1. Creating electronic invoices is the activity of formatting invoices, establishing complete information about the seller, type of invoice, invoice code, transmission-reception format, and storage format for invoices before selling goods or providing services through electronic means of businesses or organizations providing electronic invoice services, and stored on electronic media of the parties in accordance with the law.

An organization must issue a decision to apply electronic invoices before creating electronic invoices and send it in writing or electronically through the tax authority's online portal to the directly managing tax authority, and bear responsibility for this decision (according to Model No. 1 attached as an appendix to this Circular).

The decision to apply electronic invoices includes the following main contents:

- Name of the system equipment (names of electronic devices), name of the application software used to create and issue electronic invoices.

Electronic devices are means of operation based on electrical, electronic, digital, magnetic, wireless transmission, optical, electromagnetic technology, or similar technologies.

- Technical department or name of the service provider responsible for technical aspects of electronic invoices and application software.

- Process of creating, issuing, circulating, and storing electronic invoice data within the organization.

- Responsibilities of each affiliated department related to the creation, issuance, processing, circulation, and storage of electronic invoice data within the organization, including the responsibility of the person implementing the conversion of electronic invoices to paper invoices.

2. Issuing Electronic Invoices

Before using electronic invoices, the organization creating electronic invoices must issue a Notice of Issuance of Electronic Invoices to the directly managing tax authority. The Notice of Issuance of Electronic Invoices (according to Model No. 2 attached as an appendix to this Circular) includes the following contents: name of the unit issuing electronic invoices, taxpayer code, address, telephone number, types of invoices issued (name of invoice type, invoice code, model number code, start date of use, quantity of invoices issued (from number... to number...)), date of issuance of the Notice of Issuance; name, signature of the legal representative and stamp of the unit (in case the Notice of Issuance is sent to the tax authority on paper); or electronic signature of the issuing organization (in case it is sent to the tax authority via the tax authority's online portal).

In case there is a change in the business address, the organization creating electronic invoices must notify the tax authority at the new location of the issuance of unused invoices that will continue to be used.

In case there is a change in the content already notified for issuance, the organization creating electronic invoices must issue a new Notice of Issuance according to the guidance provided in this clause.

The organization creating electronic invoices must sign the sample electronic invoice and send the sample electronic invoice (in the correct format sent to the buyer) to the tax authority via the electronic route.

The Notice of Issuance of Electronic Invoices (excluding the sample electronic invoice) must be posted at the headquarters of the organization creating electronic invoices or published on the organization's online information website during the period of using electronic invoices.

3. Businesses may simultaneously create multiple forms of invoices (self-printed invoices, printed-on-demand invoices, electronic invoices) and must issue a Notice of Issuance for each form of invoice as prescribed.

When selling goods or providing services, for each sale transaction, a business must use only one (01) form of invoice, specifically: if the business uses self-printed invoices for a sales transaction, it cannot use printed-on-demand invoices or electronic invoices for that transaction; if it uses electronic invoices, it cannot use self-printed invoices or printed-on-demand invoices; if it uses printed-on-demand invoices, it cannot use electronic invoices or self-printed invoices.

Article 8. Issuing Electronic Invoices

1. Issuing electronic invoices is the process of fully establishing all information prescribed in Article 6 of this Circular when selling goods or providing services on a predefined invoice format. Forms of issuing electronic invoices:

- The seller of goods or services (the organization initiating the electronic invoice) performs the issuance of electronic invoices within the seller's electronic invoice software system.

- The seller of goods or services (the organization initiating the electronic invoice) accesses the program of the intermediary organization's electronic invoice system to initiate and issue electronic invoices.

2. Sending electronic invoices is the act of transmitting invoice data from the seller of goods or services to the buyer of goods or services.

Forms of sending electronic invoices:

- Direct transmission: The seller of goods or services (the organization initiating the electronic invoice) performs the issuance of electronic invoices within the seller's electronic invoice software system, signs electronically on the invoice, and directly transmits it to the buyer's system according to the agreed method of electronic invoice transmission between both parties. If the buyer of goods or services is an accounting unit, the buyer signs electronically on the received electronic invoice and transmits the electronic invoice with signatures of both parties to the seller according to the agreed method of electronic invoice transmission between both parties.

- Transmission through an intermediary organization providing electronic invoice solutions:

The seller of goods or services (the organization initiating the invoice) accesses the program of the intermediary organization's electronic invoice system to initiate and issue electronic invoices using the intermediary organization's electronic invoice program or the seller of goods or services inputs the created electronic invoice data from their internal system into the intermediary organization's system to send the signed electronic invoice to the buyer through the intermediary organization's system. If the buyer is an accounting unit, upon receiving the electronic invoice with the seller's electronic signature, the buyer signs electronically on the received invoice and sends the electronic invoice with signatures of both parties to the seller through the intermediary organization's system.

Article 9. Handling of Issued Electronic Invoices

1. In cases where an electronic invoice has been issued and sent to the buyer but goods have not yet been delivered or services provided, or where an electronic invoice has been issued and sent to the buyer, and neither the seller nor the buyer has declared taxes, if errors are discovered, cancellation can only be done with the agreement and confirmation of both the seller and the buyer. The cancellation of an electronic invoice becomes effective according to the agreed timeframe by the parties involved. The cancelled electronic invoice must be stored for the purpose of inspection by competent state authorities.

The seller shall issue a new electronic invoice in accordance with this Circular and send it to the buyer. On the new electronic invoice, there must be a statement indicating that "this invoice replaces invoice number..., symbol, sent on date."

2. In cases where an electronic invoice has been issued and sent to the buyer, goods have been delivered, services provided, and both the seller and buyer have declared taxes, and then errors are discovered, the seller and buyer must establish a written agreement with electronic signatures of both parties detailing the errors, while the seller issues an electronic invoice to correct the errors. The subsequent electronic invoice clearly states the correction (increase or decrease) in quantity of goods, price, VAT rate, and VAT amount for electronic invoice number..., symbol.... Based on the corrected electronic invoice, the seller and buyer shall adjust their tax declarations according to current laws on tax management and invoices. The corrected invoice cannot show a negative amount (-).

Article 10. Report on the use and delegation to issue electronic invoices

The report on the use of electronic invoices and the delegation to issue electronic invoices shall be carried out in accordance with Circular No. 153/2010/TT-BTC dated September 28, 2010, issued by the Ministry of Finance. An organization that initiates electronic invoices must submit the report on the use of electronic invoices through an electronic route via the electronic portal of the tax authority.

Article 11. Storage, cancellation, and destruction of electronic invoices

1. Sellers and buyers using electronic invoices for accounting records and financial reporting must store electronic invoices for the period prescribed by the Accounting Law. In cases where electronic invoices are initiated from a system provided by an intermediary organization offering electronic invoice solutions, such intermediary organizations must also store electronic invoices for the aforementioned period.

Sellers, buyers who are accounting units, and intermediary organizations providing electronic invoice solutions have the responsibility to back up electronic invoice data onto storage media (such as USB flash drives; CDs and DVDs; external hard drives; internal hard drives) or perform online backups to protect the data of electronic invoices.

2. Electronic invoices that have been issued must be stored in the form of data messages and must satisfy the following conditions:

a) The content of the electronic invoice can be accessed and used for reference when necessary;

b) The content of the electronic invoice must be stored in its original format as it was initiated, sent, or received, or in a format that accurately represents the content of the electronic invoice;

c) Electronic invoices must be stored in a manner that allows the origin of initiation, destination, date, and time of sending or receiving the electronic invoice to be determined.

3. Cancellation of an electronic invoice means rendering it unusable.

Destruction of an electronic invoice means making it inaccessible and unable to refer to the information contained within it.

If electronic invoices have exceeded the storage period stipulated by the Accounting Law and there is no other decision from the competent state agency, they may be destroyed. The destruction of electronic invoices must not affect the integrity of undestroyed electronic invoices and must ensure the normal operation of the information system. The procedure for destroying electronic invoices shall be carried out according to the procedures for canceling invoices as stipulated in Decree No. 51/2010/NĐ-CP of the Government and Circular No. 153/2010/TT-BTC of the Ministry of Finance.

In cases where sellers or buyers lose electronic invoices, if related parties still retain the invoices in the form of data messages, the seller or buyer may request the seller, buyer, or related party to resend the electronic invoice.

In cases where sellers or buyers lose electronic invoices and cannot contact related parties to obtain resending of the invoice, the seller or buyer must report the loss of the invoice according to Circular No. 153/2010/TT-BTC of the Ministry of Finance.

Article 12. Conversion from electronic invoices to paper invoices

1. Principles of conversion

A seller may convert an electronic invoice into a paper invoice to prove the origin of tangible goods during circulation, but this conversion can only be done once. An electronic invoice converted into a paper invoice to prove the origin of goods must comply with the provisions set forth in Clauses 2, 3, and 4 of this Article and must bear the signature of the legal representative of the seller and the stamp of the seller.

Buyers and sellers may convert electronic invoices into paper invoices to serve the storage of accounting vouchers as prescribed by the Accounting Law. An electronic invoice converted into a paper invoice for the purpose of storing accounting vouchers must comply with the provisions set forth in Clauses 2, 3, and 4 of this Article.

c) For some special areas, the participation period of civilian workers may be earlier or later than the above periods as specified by the Minister of Defense.

An electronic invoice converted into a paper invoice must meet the following conditions:

a) It must fully reflect the content of the original electronic invoice;

b) It must have a specific mark indicating that it has been converted from an electronic invoice to a paper invoice;

c) It must bear the signature and name of the person who performed the conversion from an electronic invoice to a paper invoice.

3. Legal validity of converted electronic invoices

Converted electronic invoices have legal validity when they ensure the completeness of the information on the source invoice, the specific mark indicating the conversion, and the signature and name of the person performing the conversion, all in accordance with the legal regulations on the conversion of electronic documents.

4. Specific marks on converted invoices

The specific marks on invoices converted from electronic invoices to paper invoices include the following complete information: a distinguishing phrase between converted invoices and original electronic invoices (clearly stating "INVOICE CONVERTED FROM ELECTRONIC INVOICE"); the name and signature of the person authorized to perform the conversion; the time of conversion.

Article 13. Inspection of the creation, establishment, issuance, management, and use of electronic invoices

1. The competent state authorities shall be responsible for inspecting, checking, detecting, and handling violations related to electronic invoices in the activities of buying and selling goods and providing services.

2. Organizations using electronic invoices when selling goods and providing services shall be subject to inspection and checking and shall have the responsibility to provide complete data of electronic invoices, means of storing electronic invoices, and other relevant documents to the competent state authorities in accordance with the provisions of the law. The inspection and checking of organizations using electronic invoices when selling goods and providing services shall be carried out in accordance with the provisions of the law.

Sealing, temporary detention, and confiscation of electronic devices for creating electronic invoices shall be implemented in accordance with the provisions of Decree No. 27/2007/NĐ-CP dated February 23, 2007 of the Government.

Chapter III

IMPLEMENTATION

Article 14. Effectiveness and Implementation

1. This Circular shall take effect from May 1, 2011.

2. In addition to the specific guidance provided in this Circular, other matters shall be implemented in accordance with the provisions of Decree No. 51/2010/NĐ-CP dated May 14, 2010 of the Government and Circular No. 153/2010/TT-BTC dated September 28, 2010 of the Ministry of Finance.

During the implementation process, if there are any difficulties, organizations and individuals are requested to report to the Ministry of Finance for timely guidance and resolution./.