Circular No. 5249/TC-CST regarding the deduction and refund of overpaid or mistakenly paid value-added tax (VAT) at the import stage

LETTER

OF THE MINISTRY OF FINANCE NUMBER 5249/TC-CST ON APRIL 29, 2005
REGARDING THE DEDUCTION AND REFUND OF VALUE ADDED TAX (VAT) PAID IN ERROR OR BY MISTAKE AT THE IMPORT STAGE
NỘP NHẦM TẠI KHÂU NHẬP KHẨU

RESPECTFULLY SUBMITTED TO: CUSTOMS BRANCHES OF PROVINCES, PROVINCE GROUPS, AND DIRECTLY-GOVERNED CITIES

Provincial Tax Departments under the Ministry of Finance

RECENTLY, THE MINISTRY OF FINANCE HAS RECEIVED REPORTS OF DIFFICULTIES RELATED TO THE DEDUCTION AND REFUND OF VAT PAID IN ERROR OR BY MISTAKE FOR EXPORTED AND IMPORTED GOODS. REGARDING THIS ISSUE, THE MINISTRY OF FINANCE GUIDES IMPLEMENTATION AS FOLLOWS:

1. ELIGIBLE SUBJECTS FOR DEDUCTION AND REFUND

An organization or individual importing goods (hereinafter referred to as the importer) who has paid VAT at the import stage with an amount exceeding the legally required amount (hereinafter referred to as overpayment) or who has paid VAT at the import stage but was not required to pay according to the law (hereinafter referred to as mistaken payment) is eligible for deduction and refund of VAT in accordance with this Circular.

2. PROCEDURE AND FORMALITIES FOR DEDUCTION AND REFUND

2.1. In cases where the importer is registered to pay VAT under the deduction method, the excess VAT paid or mistakenly paid at the import stage shall be included in the deductible VAT input and deducted when calculating VAT at the domestic sales stage.

Based on the tax payment receipt for imported/exported goods, the taxpayer shall declare the excess VAT or mistakenly paid VAT as part of the deductible VAT input.

In cases where imported goods are entrusted, the entrusted party (the importer of goods) is the subject entitled to deduct the excess VAT or mistakenly paid VAT.

2.2. In cases where the importer is not registered to pay VAT under the deduction method (organizations or individuals not engaged in VAT-liable goods or services or registered to pay VAT under the direct payment method), the excess VAT or mistakenly paid VAT shall be refunded to the importer.

In cases where imported goods are entrusted (the importer of goods) is the subject entitled to have the excess VAT or mistakenly paid VAT refunded.

2.3. The procedure and formalities for refunding VAT are as follows:

a. The importer prepares and submits a request for confirmation of the excess VAT or mistakenly paid VAT to the customs authority where the customs declaration was opened. The application file includes:

- A letter requesting confirmation of the excess VAT or mistakenly paid VAT.

- The customs declaration for imported goods (original and copy) verified by the customs authority;

- The tax receipt for VAT on imported goods (original and copy).

Upon receiving the file, the customs authority will compare the original and copies of the customs declaration for imported goods and the tax receipt for VAT on imported goods, then return the originals to the importer.

Within 15 days from the date of receipt of the above file, the customs authority issues a certificate confirming the excess VAT or mistakenly paid VAT on imported goods.

If the excess or mistaken payment is discovered by the customs authority itself, the importer does not need to submit the above files. The customs authority is responsible for informing the importer about the excess or mistaken VAT payment and issuing a certificate.

a. After obtaining the customs authority's confirmation, the importer prepares a request for refund of the excess or mistakenly paid VAT to send to the tax authority where the importer's main office is located (if it is an organization) or place of residence (if it is an individual). The application for refund of VAT includes:

A letter requesting the refund of mistakenly paid or overpaid VAT on imported goods;

The customs authority's certificate regarding the excess or mistakenly paid VAT;

Copy of the tax receipt for VAT on imported goods.

The tax authority is responsible for reviewing and issuing a decision to refund the excess or mistakenly paid VAT at the import/export stage within 15 days from the date of receipt of the application.

2.4. The State Treasury of provinces and centrally-administered cities shall implement the refund of VAT to the aforementioned subjects within three days from the date of receipt of the tax authority's refund decision.

2.5. The funds for refunding the excess or mistakenly paid VAT at the import/export stage shall be sourced from the VAT Refund Fund.

2.6. The number of days for confirmation and processing of refunds mentioned above shall be calculated based on actual working days (excluding weekends and holidays).

3. Organization of Implementation

Cases of excess or mistaken VAT payments at the import stage occurring before the issuance date of this Circular shall also be handled in accordance with the guidance provided in this Circular.

During implementation, if there are difficulties, please report them to the Ministry of Finance for supplementary guidance.