Introduction
The timing of invoice issuance is a crucial factor in determining tax obligations and invoice validity. Issuing an invoice at the wrong time may lead to administrative penalties or the invoice being deemed invalid. Below is a summary of the key regulations regarding invoice issuance timing that businesses must be aware of.
1. What is an Invoice, and Its Role?
An invoice is an accounting document issued by an individual or organization selling goods or providing services, recording transaction details. According to Article 3 of Decree 123/2020/ND-CP dated October 19, 2020, invoices can be in electronic or printed formats, although most businesses are now required to use electronic invoices under current regulations.
Invoices play a crucial role in accounting, tax determination, and business management. They provide key financial information that helps businesses make strategic decisions and comply with regulatory requirements.
2. Summary of Regulations on Invoice Issuance Timing
The timing of invoice issuance must comply with legal regulations on accounting documents to ensure tax compliance, prevent fraud, and maintain transparency in business transactions.
2.1. Legal Basis for Invoice Issuance Timing
Current regulations on invoice issuance timing are outlined in:
- Decree 123/2020/ND-CP, issued on October 19, 2020, governing invoices and accounting documents.
- Circular 78/2021/TT-BTC, issued on September 17, 2021, providing guidance on implementing certain provisions of the Tax Administration Law and Decree 123/2020/ND-CP.
2.2. Regulations on Invoice Issuance Timing
The timing of invoice issuance varies depending on the type of goods, services, and payment methods. According to Clauses 1 and 2 of Article 9, Decree 123/2020/ND-CP, the regulations are as follows:
(1) For Sales of Goods
- The invoice must be issued at the time of ownership or usage rights transfer to the buyer, regardless of payment status.
- Installment sales: The invoice is issued at the time of receiving an advance payment or full payment.
- E-commerce sales: The invoice is issued after completing the transaction and receiving payment from the customer.
(2) For Service Provision
- The invoice must be issued at the time of service completion, regardless of whether payment has been received.
- If payment is received before or during service provision, the invoice is issued at the time of payment (except for cases of deposits or advance payments related to specific services like accounting, auditing, financial consulting, and project supervision).
- Recurring services: The invoice is issued on the last day of the billing cycle.
- Air transport services provided through online platforms: The invoice must be issued no later than five days after issuing service confirmation documents.
(3) For Multiple Deliveries or Partial Service Completion
If a business delivers goods multiple times or completes services in stages, an invoice must be issued for each delivery or completed phase, corresponding to the value of goods/services provided.
(4) Specific Cases of Invoice Issuance Timing
| No. | Invoice Issuance Timing | Specific Cases |
|---|---|---|
| 1 | No later than the 7th day of the following month or within 7 days after the agreed cycle ends | Services requiring reconciliation, such as air transport support, fuel supply for airlines, utilities (electricity, water, telecom), logistics, and IT services billed periodically. |
| 2 | No later than 2 months after service charge accrual | Telecommunication and IT services requiring reconciliation between business entities. |
| 3 | At the time of acceptance and handover of construction projects | Construction and installation services. |
| 4 | At the time of payment or per contract agreement | Real estate, infrastructure construction, and house sales before ownership transfer. |
| 5 | No later than 5 days after issuing air transport service confirmation documents | Airline ticketing via websites and e-commerce platforms. |
| 6 | At the time of official price determination | Oil, gas, and mining industries. |
| 7 | End of the day or end of the month, summarizing transactions | Retail, food and beverage businesses, financial services (banking, securities, insurance), and digital transactions. |
| 8 | At the completion of the service or transaction | Taxi and ride-hailing services using digital fare meters. |
| 9 | End of the business day, based on transaction details | Medical services and road toll collection under electronic tolling systems. |
3. Penalties for Late or Incorrect Invoice Issuance
Under Article 24 of Decree 125/2020/ND-CP, penalties for incorrect invoice issuance timing include:
- Warning: For minor timing errors without tax implications.
- Fine of 3,000,000 – 5,000,000 VND: For incorrect timing that does not delay tax obligations.
- Fine of 4,000,000 – 8,000,000 VND: For incorrect invoice timing that affects tax reporting and compliance.
Key Considerations to Ensure Compliance
- Invoices must be issued in sequence without omissions or false entries.
- Electronic invoices must comply with digital taxation guidelines.
- All required details must be accurately recorded.
- Invoices must be securely stored as per legal requirements.
By adhering to these regulations, businesses can avoid penalties and maintain proper accounting practices, ensuring transparency in financial transactions.
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