Latest information on issuing VAT invoices for returns


  • Mai Thi Dung


In Vietnam, when selling goods and providing services to customers, sellers are required to issue VAT invoices to buyers. If the product is subsequently returned due to quality issues, how should the VAT invoice be handled? This article describes the current regulations, tax authorities’ views, and our views on how to process VAT invoices in there is a return.

1. Previous regulations

Regarding the processing of returned goods, “Circular 39/2014/TT-BTC” issued on March 31, 2014 was previously applied, but it has expired as of July 1, 2022. In addition, Appendix 4, item 2.8 of the notification stipulated as follows:

  • -If an organization or individual purchases goods and the seller issues a VAT invoice, but the buyer returns some or all of the goods due to quality problems after receiving the goods, the buyer must issue a VAT invoice to the seller with the description “Return due to quality problems”.
  • -If the buyer is unable to issue a VAT invoice, a return agreement must be drawn up between the buyer and the seller, and the seller must retrieve the VAT invoice issued to the buyer. The return agreement must clearly state the reason for the return, the name of the product, the quantity, the amount excluding tax, and the amount of VAT (for example, if the buyer is an individual without sole proprietorship or a representative office, VAT invoice cannot be issued).
  • As mentioned above, before July 1, 2022, if part or all of the product was returned due to product quality issues, the buyer was required to issue a VAT invoice to the seller in principle.

    2. Current regulations

    Currently, “Decree 123/2020/ND-CP Article 4, Paragraph 1” issued on October 19, 2020 and “Circular 78/2021/TT-BTC” issued on September 17, 2021 are applied. These regulations stipulate that when selling goods or providing services, the seller must issue a VAT invoice to the buyer. However, there are no specific regulations regarding the handling of VAT invoices when returns are made.

    3. Opinions of the General Bureau of Taxation and Local Taxation Bureaus

    In “Official Letter (hereinafter called as “OL”) No.2121/TCT-CS” published by the Directorate General of Taxation on May 29, 2023 and “OL No.4511/TCT-CS” published on October 11, 2023, it is written as below;

  • -If an organization or individual purchases a product and the seller issues a VAT invoice, but the buyer returns some or all of the product due to quality issues after receiving the product, the seller needs to issue a return invoice for canceling the issued sales invoice or adjusting the invoice.
  • -At the same time as issuing the above-mentioned return invoice, it is also necessary to create a return agreement between the seller and the buyer.
  • In response to the above-mentioned guidance from the General Administration of Taxation, most local tax bureaus have also taken the view that sellers must issue return invoices when returns are made. (for example, OL No. 73896/CTHN-TTHT by the Hanoi Tax Department and OL No. 8999/CTTPHCM-TTHT by Ho Chi Minh City Tax Department).

    On the other hand, some local tax departments have expressed the view that buyers need to issue invoices (for example, OL No. 3168/CTBDI-TTHT by Binh Dinh Province). However, in practice, in most companies, sellers issue return invoices in accordance with the OL opinions published by the General Department of Taxation, Hanoi City Tax Department, and Ho Chi Minh City Tax Department.

    4. Future prospects

    OL No. 9206/BTC-TCT released by the Ministry of Finance on August 29, 2023 included a request for opinions from local government agencies regarding the revision of Decree 123/2020/ND-CP. Additionally, there was a suggestion that the ordinance should clearly state that the seller is obliged to issue a return invoice when there is a return.

    Additionally, with the spread of electronic invoices, mechanisms are currently being built to link electronic invoice data with tax authority systems. As a result, the jurisdictional tax authority where the seller issued the return invoice will be able to easily and accurately compare sales and the amount of VAT on the invoice, and the amount of VAT and corporate tax on the VAT return.


    The General Department of Taxation and most local tax bureaus are of the opinion that sellers need to issue return invoices. The Ministry of Finance is also soliciting opinions from local government agencies regarding the revision of Decree 123/2020/ND-CP, and has expressed a positive opinion on the issue of sellers issuing return invoices. In light of the above, there is no objection to sellers issuing return invoices, but it will be necessary to continue to follow future trends regarding return invoices. If official guidance or government ordinances are issued in the future, we plan to provide additional information.


    Circular 39/2014/TT-BTC dated March 31, 2014
    Decree 123/2020/ND-CP dated October 19, 2020
    OL No. 2121/TCT-CS dated May 29, 2023
    OL No. 8999/CTTPHCM-TTHT dated July 19, 2023
    OL No. 9206/BTC-TCT dated August 29, 2023
    OL No. 3168/CTBDI-TTHT dated September 13, 2023
    OL No. 4511/TCT-CS dated October 11, 2023
    OL No. 73896/CTHN-TTHT dated October 16, 2023

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