This circular stipulates the issuance of documents for cost support, marketing support, and promotional rewards between non-agent enterprises. It guides the issuance of invoices for promotional goods and requires clear payment vouchers when implementing monetary support.
Scope of application
Enterprises, local tax authorities
Key points
- Enterprises must issue a VAT invoice for free promotional goods and strike out the tax rate and VAT amount (Point 1).
- When providing cost support in cash, enterprises must base on the promotion contract and business regulations to establish clear payment vouchers (Article 2).
- Payment vouchers must bear signatures of all parties involved and the person approving the payment is responsible for this expenditure.
- The monetary support amount shall be recorded as other expenses according to the ceiling specified in Point 11, Section III, Part B Circular No. 18/2002/TT-BTC (Article 2).
- Enterprises receiving monetary support must issue a receipt and record it as other income for corporate income tax purposes.
🌐 Social impact of this document
- To assist enterprises in complying with regulations on invoices and documents when implementing promotions.
- Ensure transparency in the accounting of expenses and income related to promotional activities.
- Contribute to strengthening tax management over monetary support.
❓ Frequently asked questions
How should an enterprise issue an invoice when conducting free promotional goods?
Issue a VAT invoice, clearly stating it is for free promotional goods and strike out the tax rate and VAT amount.
What must an enterprise do when providing cost support in cash to ensure compliance?
Base on the promotion contract and business regulations to establish clear payment vouchers with signatures of all parties involved.
How should monetary support be recorded?
Recorded as other expenses according to the ceiling specified in Point 11, Section III, Part B Circular No. 18/2002/TT-BTC.
What must an enterprise receiving monetary support do?
Issue a receipt and record it as other income for corporate income tax purposes.
Full text
LETTER
OF THE MINISTRY OF FINANCE NUMBER 5778 TC/TCT DATED JUNE 3, 2003
REGARDING THE ESTABLISHMENT OF DOCUMENTATION FOR COST SUPPORT,
MARKETING SUPPORT, AND PROMOTIONAL AWARDS
Dear: - Ministries, ministerial-level agencies, and government agencies
- People's Committees of provinces and centrally governed cities.
Recently, some local tax bureaus and businesses have raised difficulties in establishing documentation for cost support, marketing support, and promotional awards received by enterprises that are not agents. Regarding this issue, the Ministry of Finance provides the following opinions:
1. For product promotions conducted according to point 5.5, section IV, part B of Circular No. 122/2000/TT-BTC dated December 29, 2000 issued by the Ministry of Finance regarding VAT as follows: Products and goods for promotional or advertising purposes serving production and business activities subject to VAT shall be recorded on a VAT invoice or sales invoice with the notation that they are promotional items without charge. For VAT invoices, the tax rate line and VAT amount line must be crossed out, leaving only the payment price line indicating the cost or value of the goods. 2. Regarding cost support, marketing support, and promotional awards in cash: The unit providing such support shall base its actions on a promotion contract signed between both parties, the business's sales policy regarding promotions, and establish documentation for cash disbursements clearly stating that it is cost support, marketing support, or promotional awards. This payment document must be fully signed by all parties involved; the person approving the expenditure bears responsibility for this expense, which shall be recorded as other expenses according to the limit set forth in point 11, section III, part B of Circular No. 18/2002/TT-BTC dated February 20, 2002 issued by the Ministry of Finance guiding the implementation of the Law on Corporate Income Tax.
The unit receiving such financial support shall issue a receipt and must record this amount as other income for corporate income tax purposes.
The Ministry of Finance informs relevant agencies and guides units to implement accordingly.
The finance authority announces for relevant agencies to be aware of and guides units to implement.
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