The Ministry of Finance has just posted on the Electronic Information Portal the content of answering a business's question about the value-added tax (VAT) policy for short-term training activities.
According to the reflection sent to the Ministry of Finance, this enterprise is operating under the industry code 8559 - Other education has not been allocated (according to Decision No. 27/2018/QD-TTg). The company organizes short-term training courses such as teaching foreign languages, IT, speaking skills, leadership skills, corporate governance... for cadres, civil servants, public employees, the community and businesses.
Pursuant to Clause 13, Article 5, Law on VAT No. 48/2024/QH15, the activity of "teaching and vocational training according to the provisions of the law on education and vocational education" is not subject to VAT. However, businesses are wondering whether these short-term training courses are considered teaching and vocational training activities according to the law or not. At the same time, the enterprise requested clarification:
- Is the issuance of invoices for contracts for organizing short-term training courses not subject to VAT as prescribed in Clause 13, Article 5 of the Law on VAT No. 48/2024/QH15?
- If not subject to tax, what is the applicable VAT rate (0%, 5% or 10%)?
Hanoi City 14 Grassroots Tax replies: Pursuant to Clause 13, Article 5, Law on VAT No. 48/2024/QH15 and Law on Vocational Education No. 74/2014/QH13:
In case the enterprise organizes short-term training courses under vocational training and teaching activities according to the provisions of the law on education and vocational education and meets the conditions specified in Article 19 of the Law on Vocational Education, this activity is not subject to VAT.
If it does not meet the requirements under Article 19 of the Law on Vocational Education (on registration of vocational education activities), training activities are determined to be services subject to VAT with a tax rate of 10% according to Article 9 of the Law on VAT No. 48/2024/QH15.
Regarding VAT invoices, the tax authority guides:
If providing non-taxable services: state "KCT" (No VAT) in the "Tax rate" indicator on the invoice, according to Article 10 of Decree 123/2020/ND-CP and Decision 1510/QD-TCT.
If providing taxable services: make an invoice according to regulations, apply a tax rate of 10%.
The Ministry of Finance recommends that units in the process of implementing tax policies should refer to additional instructions on the portal or contact the tax authority directly for support.
