The General Department of Taxation provides guidance on VAT and corporate income tax policies related to trade discounts and sales price reductions at the request of the Tax Department of Ba Ria – Vung Tau province and VHGS Company as follows:
- VAT policy:
- According to Circular 219/2013/TT-BTC, the VAT calculation price is the selling price after trade discount. Discounts based on quantity or sales will be adjusted on the final invoice or at the end of the program.
- If errors are detected on the declared invoice, the seller and buyer shall issue an adjusted invoice according to Circular 39/2014/TT-BTC.
- Decree 123/2020/ND-CP requires details of discounts on invoices and determination of VAT calculation prices according to regulations.
- Circular 78/2021/TT-BTC guides the adjustment of electronic invoices with errors.
- Corporate income tax policy:
- Circular 200/2014/TT-BTC stipulates that sales price reduction is a revenue deduction if the goods do not meet contract requirements. Trade discounts are tracked separately when customers qualify for the discount during the last purchase period.
- Revenue subject to corporate income tax includes sales proceeds and surcharges, determined at the time of transfer of ownership of goods (Circular 78/2014/TT-BTC and 96/2015/TT-BTC).
Click here to see details of Official Dispatch 4991/TCT-CS 2024
