Revenue over 1 billion VND, must use electronic invoices
The base tax of 5 provinces in Ha Tinh has just answered a business household about how to calculate taxes and invoices for affiliate marketing activities on the TikTok platform.
According to the question and answer content, this person registered a business household to fulfill tax obligations and issue invoices. The commission from Affiliate activities was directly transferred to a bank account by TikTok, a foreign legal entity, in Vietnamese Dong.
Revenue in the year has exceeded 1 billion VND, but business people said they do not dare to issue invoices because they have not determined the tax rate, the recipient of the invoice, as well as the content to be recorded on the invoice.
This person also asked whether affiliate TikTok activities are subject to a total tax of 7% or 10%.
Regarding electronic invoices, the tax authority cited Decree 254/2026/ND-CP, according to which business households and individual businesses with annual revenue over 1 billion VND are subject to using electronic invoices.
In the case of readers providing that they are business households with income from marketing receiving commissions, have registered business households and have revenue of over 1 billion VND, the tax authority said that they are in the case of having to use electronic invoices.
A noteworthy detail is that the content written on the invoice must clearly state "Affiliate marketing commission on the TikTok platform".
Regarding the time of invoice issuance for service provision, the tax authority cited the provisions of Decree 254/2026/ND-CP. Accordingly, the time of invoice issuance is the time of completion of service provision, regardless of whether money has been collected or not.
In case the service provider collects money before or during the service provision, the time of invoice is the time of collection. This regulation does not include a deposit to ensure the performance of the service provision contract as prescribed by the Civil Code.
Affiliates enjoying commissions may be subject to 5% VAT, 2% PIT
Regarding tax rates, the tax authority said that current law stipulates that the group of brokerage services, auctions and agent commissions are subject to VAT at a rate of 5% on revenue.
For personal income tax, the group of brokerage services, auctions and agent commissions are subject to a tax rate of 2% on revenue for resident individuals with business activities.
From there, the Basic Tax Department of 5 provinces of Ha Tinh said that if the actual operation is marketing services enjoying product commissions, the VAT applied is 5% and the PIT is 2% on revenue for business households.
Thus, in this case, the total ratio of the two corresponding taxes is 7% on revenue.
However, the tax authority does not assume that all TikTok Affiliate activities apply this level.
According to feedback, the information provided by the respondent does not clearly show whether this is a marketing service enjoying commissions on products or a product advertising service. Therefore, businesses need to base on contracts, agreements and actual operations to correctly determine the nature of the service and apply appropriate tax rates.
Regarding the question of which unit the invoice must be issued when TikTok is a foreign legal entity that directly pays commissions, the tax authority has not yet given a specific object.
The reason is that the questioner has not fully provided the contract or marketing agreement for commission, payment method and payment time. The base tax of 5 provinces of Ha Tinh believes that there is not enough basis to determine specifically, and at the same time requests business households to compare the regulations on electronic invoices to implement.
