A business sent a question to the Ministry of Finance expressing concern about the regulation on deduction of input VAT for goods and services purchased at installments and installments.
According to current regulations, for late payment invoices over 5 million VND, enterprises are allowed to deduct input VAT at the time of receiving the invoice, based on the contract and VAT invoice, even before the payment date.
However, the regulation also clearly states: "In case the payment time is according to the contract... the business establishment does not have a non-cash payment document, then... it must declare and adjust the amount of input value added tax that is deducted down".
The business wondered: "So if after the contract expires, we have all the documents, will we be able to deduct? If so, how many days after the deadline is the deadline? ".
The representative of this company gave a practical example of electricity and water contracts, sometimes only a few days due to payment deadlines due to a weekend, power outage or other objective reasons that customers have not made recommendations for. The enterprise believes that if it is not deducted in this case, it will be "too unfortunate" and recommends that the management agency study it again to suit the reality.
Regarding this issue, the Ninh Binh Provincial Tax Department has issued a document guiding.
Accordingly, the Ninh Binh Provincial Tax Department recommends that readers base on legal regulations to compare with the actual situation and implementation. The tax authority has cited relevant provisions in the Law on Value Added Tax and Decree No. 181/2025/ND-CP.
Specifically, Point g, Clause 2, Article 26 of Decree 181 clearly stipulates that in cases where the enterprise does not have non-cash payment documents at the time of payment under the contract, it is mandatory to declare and adjust the VAT amount deducted to the tax calculation period arising from that payment obligation.
Regarding the question, where will this non-deductible VAT go?
According to Clause 16, Article 23 of Decree 181 also stipulates: For input VAT that is not deductible (including cases where invoices from VND 5 million or more do not have non-cash payment documents), the business establishment is included in the cost to calculate corporate income tax or included in the unit price of fixed assets.
Thus, according to the instructions of the tax authority based on current regulations, if the enterprise pays late (after the contract term), at the tax calculation period with the payment period, the enterprise must still declare an adjustment to reduce the deducted VAT. This tax will not be lost but will be converted into a reasonable cost when calculating corporate income tax.
