Vietnam VAT Rate and Refund Rules 2026: A Practical Guide for FDI Companies

Vietnam’s VAT changes over 2025–2026 are spread across several effective dates rather than concentrated on a single day as with the invoicing rules. The key point to grasp: the biggest change is not the rate — it is the conditions for input credit and the mechanics of declaration.

This article gives the overall picture for foreign-invested enterprises, with links to dedicated analyses for each specialised topic.

1. The legislation currently in force

Circular No. 89/2026/TT-BTC introduces new return templates and declaration guidance. Finance teams need to update templates and filing software before the July 2026 declaration period.

2. The non-cash payment threshold: VND 5 million

This is the change with the widest impact on day-to-day operations.

A business must hold non-cash payment documents for goods and services purchased — including imports — from VND 5 million upward. The basis is Article 14 of Law on VAT No. 48/2024/QH15 and Article 26 of Decree No. 181/2025/ND-CP.

In practice, many small costs that used to be settled in cash — stationery, entertainment, minor repairs, one-off service fees — must now be paid by transfer to qualify for credit. An invoice of VND 5.5 million paid in cash means losing VND 500,000 of input VAT, plus exposure on deductibility for CIT purposes.

For costs settled by a third party on your behalf — logistics charges, lift-on lift-off fees, shipping line charges — check whether the contract contains a payment-on-behalf clause. Its absence is a common audit finding.

On payment documentation in refund claims, see bank payment conditions for input credit and VAT refunds on exports.

3. Input VAT apportionment: no year-end recalculation

Under Article 23 of Decree No. 181/2025/ND-CP, shared input VAT is apportioned by the ratio of VAT-taxable revenue to total revenue in the tax period, and is not reapportioned using full-year figures.

The year-end recalculation in the final month or quarter has been removed. For accountants this means the familiar year-end adjustment lever no longer exists — the ratio is fixed period by period.

A consequence worth noting: because the ratio locks per period, declaring omitted invoices and deciding which period’s revenue drives their apportionment becomes a sensitive point likely to attract scrutiny. Keep documentation explaining the basis for the period selected.

4. Services supplied to export processing enterprises

The conditions for the export service rate have tightened. Under Article 17 of Decree No. 181/2025/ND-CP, an export service is one supplied directly to an organisation in a non-tariff zone, consumed within the non-tariff zone, and serving export production directly. The third limb is new.

Risk to note: “serving export production directly” is not clearly defined. Where the customer is an export processing enterprise with activities beyond manufacturing — trading, services — applying the export service rate requires particular care.

Documentation recommendation: retain the customer’s investment registration certificate and a written confirmation of its business lines and the intended use of the service. This is a low-cost precaution with high value in a retrospective audit.

5. Services bought from foreign suppliers on digital platforms

The 10% rate continues to apply to services supplied by foreign providers through e-commerce and digital platforms. This position is carried over unchanged.

The common oversight: online advertising fees, SaaS subscriptions and cloud storage are typically paid by company credit card and booked as ordinary expenses — leading either to a missed foreign contractor tax obligation, or to input VAT being wrongly claimed on documentation that is not a Vietnamese VAT invoice.

Two case analyses: foreign contractor tax when buying services from suppliers on e-commerce platforms and buying OpenAI’s ChatGPT Business: input VAT and CIT deductibility.

6. Deferred-payment invoices past their due date

Decree No. 144/2026/ND-CP, effective 20 June 2026, gives statutory footing to treatment that previously existed only in official letters.

The mechanism has three steps: claim the credit normally in the period the invoice arises; if payment has not been made by the due date, reduce the input VAT credited in that period; once non-cash payment documentation exists, reinstate the credit. The full credit is preserved, but the timing shifts.

Set up overdue-payables monitoring tied to the filing calendar so the adjustment lands in the right period.

7. Amended returns: the window narrows from 10 years to 5

Under Law on Tax Administration No. 108/2025/QH15, the limit is 5 years from the filing deadline of the period containing the error, and the amendment must be made before the tax authority announces an inspection or audit decision.

Warning: the correction window is halved. Periods already beyond 5 years can no longer be adjusted. This belongs in the 2026 internal review plan, prioritising periods closest to expiry.

8. Indicators [37] and [38] on the return

This is the change with the clearest impact on day-to-day practice. The principle to remember: file an amended return for the original period, and reflect the difference in indicator [37] or [38] of the period in which the error is found.

Previously there was no specific guidance here, so practice varied. Circular No. 89/2026/TT-BTC sets out each scenario — input errors, output errors, and cases that change both the amount payable and the credit carried forward.

For scenario-by-scenario guidance with worked examples, see amending the VAT return: indicators [37], [38] and when form 01/KHBS is required.

9. VAT refunds

Refund situations commonly encountered by FDI companies are analysed separately:

• VAT refunds on goods imported through a local intermediary and exported on the spot
• Bank payment documentation requirements for export VAT refunds

10. What to do now

1. Standardise the payment process: every cost from VND 5 million upward, VAT inclusive, must be paid by transfer; review payment-on-behalf clauses in third-party contracts.
2. Review periods likely to contain errors before the 5-year amendment window closes.
3. Establish overdue-payables monitoring tied to the monthly or quarterly filing calendar.
4. Update templates and filing software for Circular No. 89/2026/TT-BTC before the July 2026 period.
5. Build the supporting file for services to export processing enterprises: the customer’s investment registration certificate and confirmation of business lines and intended use.
6. Review foreign contractor tax obligations on digital services purchased from abroad.

For the accompanying invoicing rules, see the e-invoice guide applicable from 1 July 2026. For penalties, see administrative penalties for tax and invoice violations in 2026.

This article was prepared by Trustlineax based on Law on VAT No. 48/2024/QH15, Decree No. 181/2025/ND-CP, Decree No. 359/2025/ND-CP, Decree No. 144/2026/ND-CP, Law on Tax Administration No. 108/2025/QH15, Decree No. 252/2026/ND-CP and Circular No. 89/2026/TT-BTC. It is for information purposes only and does not replace the original legal documents or tailored tax advice.

How TrustlineAX Can Help

VAT compliance in Vietnam requires both technical expertise and current knowledge of General Department of Taxation guidelines and enforcement priorities. TrustlineAX provides end-to-end VAT compliance services — from monthly return preparation and e-invoice management to VAT refund applications and audit support — so your finance team can focus on business growth rather than tax administration.