Khóa luận tốt nghiệp Kế toán kiểm toán: Value added tax accounting at Gia Khiem Consultant company

2.1.2.3 Role of VAT From the advantages of Value Added Tax VAT, the application of VAT plays the following roles: - Encouraging a portion of consumer income into the state budget through

VALUE ADDED TAX ACCOUNTING AT GIA KHIEM CONSULTANT

UNIVERSITY OF ECONOMICS AND LAWFACULTY OF ACCOUNTING AND AUDITING

GRADUATION THESIS

COMPANY

Lecturer: Mr Duong Trong Nhan

Student: Le Thu UyenStudent ID: K204051386

Class: K20405CA

Ho Chi Minh City, April 2024

1

———————————ễễễễễễễễễễễễễễễễễễễễễễi

Firstly, I would like to express my gratitude to Mr Duong Trong Nhan, my direct

instructor, who provided me with important information and sincere ideas that helped

me understand and complete the chosen thesis to the best of my ability

Secondly, I extend my heartfelt appreciation to the instructors of the University of

Economics and Law in general, and the lecturers of the Faculty of Accounting —

Auditing in particular, for their guidance and support during my four years of study

and work at the university.

Thirdly, I wish to thank the accounting department at Gia Khiem Consultant

Company for taking the time to guide me and create favorable conditions for gainingpractical experience and collecting material for this topic Working in a professional

environment is a great honor and motivation for self-improvement

During the internship and in the process of writing the internship report, it is difficult

to avoid mistakes due to my limited practical experience and theoretical level

Therefore, I hope to receive suggestions and advice to gain more specialized

knowledge

Finally, I would like to wish the teachers of the University of Economics and Law

good health, well-being, and prosperity I also extend my best wishes to everyone at

Gia Khiem Consultant Company for achieving many successes in their lives.

Thank you very much!

Ho Chi Minh, March 2023

Le Thu Uyen

LIST OF DIAGRAMS

Diagram 3.1.2: Company's organizational strucfure 31

Diagram 3.1.3: company’s accounting sysfem - 32

Diagram 3.3.1: Process diagram of purchasing raw materials at the company .36

Diagram 3.4.1: Diagram of sales process at the Company 47

LIST OF FIGURES

Figure 1: Characteristics of the company's assets and capital resources 33

Figure 3.1: Taxe rate 10% in Misa accounting soffware 39

Figure 3.2: Taxe rate 5% in Misa accounting soffWare - 41

Figure 3.3: Taxe rate 0% in Misa accounting soffware - 43

Figure 3.4: Sales Taxe rate 10% in Misa accounting soffware 50

Figure 3.5: Sale of goods in export processing zones (0% tax rate) in Misa accounting Ea e cece eee sees eee eeeeeeeaeeeeeeeeeeennenbaaneeneeees 52 Figure 3.6: Export sales (0% tax rate) in Misa accounting software 54

LIST OF DOCUMENTSDocument 3.1: Input VAT invoice No 0000723 -. -: 38Document 3.2: VAT invoice No 0002011 c<<<<2 40Document 3.3: VAT invoice No 0003634 c2 42Document 3.4: Sales VAT invoice No 0002121 49Document 3.5: Sales VAT invoice No 0002068 : 51Document 3.6: Sales VAT invoice No 0002081 53

Table of ContentsACKNOWLEDGEMENNT 0 << G <00009 0006890 2LEST OF DTAGRAMID ccsscsscssscessessessscssesssesssesseossesseesesssazsseisensscesseasensnccssensessiensaeiseassensaces3LIST OF EIGUIREES 55 5 5 5 << 5 TT TH T0 0.00010000900000 890 4LIST OF DOCUMENTTS 0 G5 <5 5 nọ TH nọ TH 000000 009800 5CHAPTER 1: INTRODUCTION d5 G5 6 G5 9 99 9 0 0 000008 908

2.1.1 General Overview Of (AX©S G0 cọ HH THỌ Họ HH T0 00000009 0806 11

2.1.1.1 general taxes CONCEPTS 7G G5 G6 G5 959.099 0 0 000000966 88896 11

2.1.2 Concept, features and role Of VỀ Ấ TỬ - s5 << s5 s91 9 0 089560895686 12

2.1.2.1 Concept Of VAẠTH doc s s2 9 9 9 0 00.04 00000 0660096686096 122.1.2.2 Features Of VẠT, << s9 0 00009 0040060990 122.1.2.3 Role Of VẠT << 5< 4 9 HH cọ 0.0 T0 00100000010 01.088990 13

2.1.3 Taxable subjects and VAT DYTFS o5 G5 << S59 9 0 00.0 09 65.8 13

2.1.3.1 Taxable SUÌD©CS dc 7G G5 5 G55 99 999 0909 00900 04 00 009 666096689696 132.1.3.2 VAT AaVFS (G5 < SH cọ TH 0.0009 0001.000990 132.1.3.3 Non-taxablle SỤDj€CẤS 5 5< s < HH TH 000000000 80990 142.1.4 Basis for calculating V ATỬ c0 G6 5 S9 99 99 909 0.00096090996890 15

2.1.5 Roles and responsibilities of VAT ac€0unfÏng -<55s sse<sseesseeee 17

2.1.5.1 The role of value-added tax a€COUunÏN o5 << 5< 5s 5= sssessse 172.1.5.2 The duties of value-added tax accounting 2-55 5 555559 559% 18

2.1.6 Deductible VAT accounting 7G G5 GG G55 99 9 0 0.0 00 0 00996890 19

2.1.6.1 Accounting DFÏTCÏÏ€S 5 <5 << 5 9 SH TH 009008990 192.1.6.2 Documents and Accounts Used s5 << 5< s s4 9561955558956 20

2.1.7 Accounting for VAT payaÌC o5 5S 9 99 0 0 1 006 90 21

2.1.7.1 Accounting DFÏTICÏJDÌCS do G G5 5G 6 %9 999 9999.904 009 59099688996 212.1.7.2 Documents and Accounts Used <55 << 5554 SE 826 222.1.8 Pay taxes and declare VAT doc do s6 9% 99 99 90 90.9000 60096890 24

2.1.8.1 Principles of calculating and declaring Value Added Tax (VAT) 242.1.8.2 Tax declaration OSSÏ€T << 5G «5 s5 9 98990095 9589108988656252.1.8.3 Deadline for submitting VAT tax declaration documenfs: 262.1.9 VAT finaliZafÏ0n <5 <6 G5 9 0 00.009 0000900000 4000000400680262.2 Research m€thod -0œ G555 5 5 9.99 9.900.100.000 0004.1009100040028

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CHAPTER 3: CURRENT SITUATION OF VAT ACCOUNTING AT GIA KHIEMCONSULTANT COMPANY 0.::ssss:sessscssssssssesssseasssnsssssssssensassssesssessussesssassssssessssnssassess 303.1 History and development about Gia Khiem company Limited 30

3.1.1 The process of formation and deVeÏ0pIm€II( <5 5< <5 5< «5e ssees seees 303.1.2 Company's organizational SÍTUCỀUIF 5 << 5 5 << S5 9 9 9 4.06 89996303.1.3 Company’s aCCOUnIfÏTĐ SYS€IT o5 55 << < 5 99 0 09 0 09 684556313.2 Financial situation of the COMpPaANY 55 << 55 9 99 9 09090 0950 6856 33

3.3 Illustrating the accounting procedures for tax finalization at Hung Long

Thread Joint Stock company by Gia Khiem consultant Company Limited 34

3.3.1 Value Added Tax (VAT) Characteristics at the Company - 34

3.3.1.1 Tax Calculation Method, Applicable Tax Rafes 343.3.1.2 Accounting for inpuf VA ÏT << 5 5< s4 999 0 0 09 080980 68880 353.3.1.3 Accounting for OUtPUt V A TỬ << 5 5 << s9 9 0.0 090 088840068866 473.3.1.4 VAT on Imported Good 55 << 5 5< 99 9999900 8950 6188568856 583.3.2 VAT tax fimalization 5 655 << SH 000000900 0098.06 58CHAPTER 4: COMMENTS AND RECOMMENDA TIONS e<<c<<e< 61

4.1 General comments about the accounting procedures for tax finalization at

Gia Khiem consultant COMPANY 2.5 55 << 5 5 << 594 994.0 00.90009009 66894 06 61

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CHAPTER 1: INTRODUCTION

1 Research reason

Economic development is always the primary goal for every nation To promote the

economic development process of each country, Vietnam needs to have a favorable

investment environment and appropriate, clear, and stable policy mechanisms In

response to that goal, the Value Added Tax (VAT) Law was passed by the XI

National Assembly of the Socialist Republic of Vietnam at the 11th session and cameinto effect on January 1, 1999, replacing the Revenue Tax Law Our state's

replacement of the Revenue Tax Law with the VAT Law is entirely consistent with

the trend of tax reform in countries around the world Tax is considered the most

progressive method of revenue collection today, highly appreciated for achieving themajor objectives of tax policy such as generating significant revenue for the state

budget, simplicity, and fairness Over the years of implementation, the VAT Law andits amendments have been effective in socio-economic development, encouraging

investment, stabilizing business activities of enterprises, and improving the

management capacity of tax authorities However, the practical implementation of theVAT law also faces many difficulties and obstacles that need to be resolved such as

invoicing issues, tax deductions, VAT refunds, VAT rates, etc Although amendments and resolutions partially address these challenges, with the current economic

development tasks and requirements, the VAT Law is increasingly perfected and

suitable for the country's economic situation Currently, VAT accounts for a large

proportion of the taxes payable in enterprises, and VAT taxation issues frequently

arise in any business Therefore, emphasizing research and improving the efficiency

of VAT accounting in enterprises is essential Proper accounting of transactions and

accurate determination of the amount of tax payable will help enterprises proactivelyfulfill their tax obligations to the state budget and facilitate their compliance with state

obligations Once compliance and strict adherence to tax obligations are achieved,

enterprises will enhance their credibility in the market and contribute to state budget

revenue Furthermore, proper and accurate tax accounting enables enterprises to plan

rationally without being passive when additional tax amounts arise or due to

miscalculations Recognizing the importance of VAT, with the knowledge acquired atschool and practical experience at Quang Tri Trading Company, I have chosen the

topic "The Current Situation of VAT Accounting at Gia Khiem Consulting and

Service Company" as the subject of my research during my internship period

Research objectives

Systematize theoretical issues regarding taxes and VAT accounting

Study the legal documents related to tax accounting in general and VAT accounting in particular.

Understand the current situation of VAT accounting work and the implementation of

VAT laws at the internship unit

Evaluate the strengths and weaknesses of the accounting system in general and VAT

accounting work in particular, and propose solutions to contribute to improving VATaccounting work and implementing tax laws at the Company

Research Object

Legal documents regulating tax accounting in general and VAT accounting in

particular

The implementation of the VAT Law, VAT accounting work at the Company, and

legal provisions related to VAT accounting work at the Company.

Research methodologies

Document research method: Collecting relevant information related to the topic:

textbooks, circulars, accounting standards, tax laws, accounting websites, etc., to

systematize the theoretical part regarding VAT

Direct interview method: This method is used to directly inquire from information

providers, necessary data for the research topic This method is used to provide

necessary information and raw data for the topic

Data collection and processing method: This method is applied to collect raw data

from the Company Then, all raw data is selected and processed to be incorporated

into the thesis in the most effective way for readers.

Accounting method: This method is used to understand the process of recording,

summarizing input and output VAT at the Company

CHAPTER 2: THEORETICAL BASIC FOR VAT AND RESEARCH

METHODOLOGIES2.1 Theoretical Review for VAT

2.1.1 General overview of taxes

2.1.1.1 general taxes concepts

Taxes are intrinsically linked to the existence and development of the state Until

now, there has not been a unified concept of taxes in global economic reporting

policies Various perspectives on taxes have been proposed:

According to the economic perspective of David Ricardo, as mentioned by Tran Binh Trong (2008): "Taxes are composed of portions taken by the government from land

and labor within the country Ultimately, taxes are taken from capital or the income ofthe taxpayer."

The perspective on taxes by VI Lenin is also referenced by author Phan Thu Cuc

(2009): "Taxes are amounts collected by the state from the people without

reimbursement."

According to Wikipedia's dictionary: "Tax is a compulsory financial fee or another

type of levy imposed on a taxpayer (an individual or legal entity) by a governmental

organization to fund various public expenditures."

According to the Vietnamese dictionary (1998): "Tax is a sum of money or goods that individuals or business entities, depending on assets, income, profession, are obliged

to pay to the State as regulated."

According to Tax Management Law No 38/2019/QH14: "Tax is a compulsory

contribution to the state budget by organizations, households, business households,

and individuals as stipulated by tax laws."

From an economic standpoint: "Taxation is formed through the process of distributionand redistribution of the total social product, national income."

In this study, the concept of taxation is understood as: "Taxes are mandatory

contributions according to the Law by citizens without considering the value of

services received by the taxpayer or the fines imposed for violations."

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Characteristics of taxes are outlined as follows:

According to VAT Law No 13/2018/QH12, taxes have several characteristics:

Firstly, taxes are compulsory contributions that all legal entities and individuals mustcontribute to as stipulated by the law

Secondly, taxes are not directly reimbursed, but all citizens benefit from public

service projects invested in by the State budget

Thirdly, legal entities and individuals are only required to pay the types of taxes

prescribed by law

2.1.2 Concept, features and role of VAT

2.1.2.1 Concept of VAT

According to Value Added Tax (VAT) Law No 13/2008/QH12 issued by the

National Assembly on June 3, 2008: "VAT is a tax levied on the added value of goodsand services generated during the production, circulation, and consumption process."VAT is implemented according to the VAT Law and is calculated on the selling price

exclusive of VAT Producers, suppliers of goods and services are responsible for

collecting and remitting VAT to consumers Consumers purchasing products, goods,

and services bear the VAT, as it is included in the prices they pay Therefore,

consumers are the ones liable for this tax.

2.1.2.2 Features of VAT

According to Value Added Tax (VAT) Law No 13/2008/QH12 issued by the

National Assembly on June 3, 2008, and Circular No 219/2013/TT-BTC dated

December 31, 2013, several characteristics of VAT can be summarized as follows:

Firstly, VAT is an indirect tax, and the tax amount is embedded in the prices of goodsand services The taxpayer is the service provider or supplier of goods, while the tax

bearer is the consumer who purchases these goods or services

Secondly, VAT has a broad tax base, encompassing nearly all goods and services

used for business operations within the territory of Vietnam All individuals and

organizations are subject to VAT

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Thirdly, VAT applies to almost all stages of production and distribution because it islevied on the value added of goods at various stages From production to circulation

and consumption, consumers pay the tax through the purchase of goods and services.Fourthly, the scope of VAT covers consumers within the territory of Vietnam Goodsexported are not subject to VAT, as the export VAT rate is 0%, and input VAT on

those goods can be deducted

2.1.2.3 Role of VAT

From the advantages of Value Added Tax (VAT), the application of VAT plays the

following roles:

- Encouraging a portion of consumer income into the state budget through the process

of purchasing goods and services;

- Limiting tax losses;

- Enhancing accounting and invoicing practices and promoting transactions with

invoices and documents;

- Contributing to the promotion of production and development, facilitating exports asVAT helps overcome duplication in taxation;

- Contributing to the improvement of tax policies, aligning with the dynamics and

development of the market economy.

2.1.3 Taxable subjects and VAT payers

2.1.3.1 Taxable subjects

According to Article 2 of Circular No 219/2013/TT-BTC issued on December 31,

2013, it stipulates: The subjects liable for Value Added Tax (VAT) are goods and

services used for production, business operations, and consumption in Vietnam

(including goods and services purchased by organizations, individuals from abroad),

except for the subjects exempt from VAT as guided in Article 4 of Circular 219 and

according to the provisions of the VAT Law.

2.1.3.2 VAT payers

According to Article 3 of Circular No 219/2013/TT-BTC issued on December 31,

2013, it is regulated that:

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Taxpayers for Value Added Tax (VAT) are organizations and individuals engaged inthe production and business of goods and services subject to VAT in Vietnam,

without distinction of industry, form, or organization of business (hereinafter referred

to as business entities), and individuals or organizations importing goods, purchasingservices from abroad subject to VAT (hereinafter referred to as importers), including:Business entities established and registered for business operation according to the

Enterprise Law, Cooperative Law, and other specialized business laws; Economic

organizations of political organizations, socio-political organizations, social

organizations, occupational social organizations, armed forces units, enterprise

entities, and other organizations; Enterprises with foreign investment capital and

foreign parties participating in business cooperation according to the Investment Law;organizations, individuals abroad engaging in business activities in Vietnam but not

establishing legal entities in Vietnam; Individuals, households, independent business

groups, and entities engaged in production, business, and importation; Organizations,individuals engaged in production and business in Vietnam purchasing services

(including services associated with goods) from organizations with permanent

establishments in Vietnam, foreign individuals not residing in Vietnam Branches of

export enterprises established to engage in the purchase and sale of goods and directly related activities in Vietnam as regulated by laws on industrial parks, export-

processing zones, and economic zones

2.1.3.3 Non-taxable subjects

The entities exempt from tax are regulated in Article 5 of Value Added Tax (VAT)

Law No 13/2008/QH12 and Clause 1, Article 1 of the Law amending and

supplementing some articles of VAT Law No 31/2013/QH13, specifically stipulated

in Article 4 of Circular No 219/2013/TT-BTC issued by the Ministry of Finance,

comprising 26 groups of goods and services as follows:

According to current regulations, goods and services not subject to VAT primarily

include consumer goods and services serving society such as: agricultural products,

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livestock, salt products, or unprocessed aquaculture products, non-profit services, or

public services in healthcare, education, training

Products of agriculture, aquaculture, capture fisheries not yet processed into other

products or only through common processing by organizations, individuals for

self-production, sale, and importation Products include animal breeds, crops, medical

services, veterinary services, public services, postal and telecommunications services,teaching, vocational training, broadcasting, television Public transportation vehicles,

weapons, specialized resources serving national defense, security Relief goods, gifts imported Goods in transit, transit, temporary importation, re-exportation, technology

transfer, intellectual property rights transfer, unprocessed gold products Products

serving healthcare, goods, services of individuals with lower than average income

Businesses providing goods and services not subject to VAT as regulated in Article 5are not eligible for deduction and refund of input VAT, except in cases where the 0%tax rate is applied as stipulated in Clause 1, Article 8 of the VAT Law

2.1.4 Basis for calculating VAT

Based on the calculation of Value Added Tax (VAT), the taxable price and tax rate

are determined as follows, according to the regulations in Circular No

16/VBHN-BTC dated June 17, 2015:

Taxable Price Calculation:

The VAT taxable price (GTGT) is defined in Article 7 of Circular 219/2013/TT-BTC

as follows:

For goods and services sold domestically, the GTGT taxable price is the selling priceexcluding VAT, as indicated on the sales invoice or the price excluding VAT stated

on import documents For goods subject to special consumption tax and

environmental protection tax, the selling price includes both the special consumptiontax and environmental protection tax but excludes VAT

For imported goods, the taxable price is the import price at the border gate plus any

import duties (if applicable), special consumption tax (if applicable), and

15

environmental protection tax (if applicable) The import price is determined according

to the regulations for calculating tax on imported goods

For products, goods, and services (whether purchased externally or produced by the

business itself) used for exchange, gifts, compensation, or barter, the GTGT taxable

price is based on the equivalent price of similar goods or services at the time of thesetransactions

The GTGT taxable price for internally consumed products, goods, and services is

determined based on the equivalent price of similar products or services at the time of their use Goods transferred internally are not subject to GTGT.

In cases where products, goods, or services are used for promotional purposes as per

trade law regulations, the taxable price is considered zero If not compliant with tradelaw regulations, the tax must be declared and paid as if the goods or services were forinternal consumption, gifting, or giving

For rental activities involving assets such as houses, offices, workshops, warehouses,docks, yards, transportation vehicles, machinery, and equipment, the rental amount

excluding GTGT is considered If rent is paid periodically or in advance for a specificperiod, the tax treatment follows the relevant provisions

For goods sold on an installment or deferred payment basis, the taxable price is the

one-time payment price exclusive of VAT for those goods, excluding installment or

deferred payment interest.

For goods processing, the price is the processing fee according to the processing

contract exclusive of VAT, including labor costs, fuel, power, auxiliary materials, andother expenses serving the goods processing

For construction, installation, the price is the value of the construction work, project

items, or the part of the work delivered exclusive of VAT In cases where construction

or installation includes a bill of materials, the price includes the cost of materials

exclusive of VAT If the construction or installation does not involve subcontracting

of materials, machinery, equipment, the tax base is the construction or installation

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value excluding the value of materials and machinery and equipment exclusive of

VAT

- For real estate transfer activities, the tax base is the real estate transfer price minus the

land price deducted for VAT calculation Specific cases are regulated in Clause 10,

Article 7 - Circular 219/2013

- For agency, brokerage activities in buying and selling goods and services,

commission-based import and export transactions, the taxable price is the commissionfee, or the commission earned from these activities exclusive of VAT

- For goods and services using payment documents with VAT included such as stamps,

transportation tickets, lottery tickets, the price excluding VAT is determined as

follows:

the original price

Price without VAT =——_2 +" =

1+ VAT percentage

The tax base is determined in Vietnamese dong In cases where the taxpayer generatesrevenue in foreign currency, it must be converted into Vietnamese dong at the averageexchange rate on the interbank foreign exchange market published by the State Bank

of Vietnam at the time when the revenue is generated for tax calculation purposes

2.1.5 Roles and responsibilities of VAT accounting

2.1.5.1 The role of value-added tax accounting

According to Phi Thi Diem Hong, Bui Thi Phuc, and colleagues (2019), the VietnamAcademy of Agricultural Sciences presents the role of tax accounting as follows:

Value-added tax (VAT) accounting is responsible for tax declaration issues within

enterprises and fulfilling the obligations of enterprises to the state The state can onlyeffectively manage a diverse economy with tax accounting Therefore, the role of tax

accounting is crucial for both enterprises and the state The task of tax accounting is to record fully, accurately, and on time, and to prepare tax reports and financial reports

to serve both enterprises and tax authorities during tax inspections Tax accounting is

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directly related to state laws and must comply with the laws, regulations, and decreesissued by the Ministry of Finance and the state Therefore, those who undertake this

position must not only possess specialized knowledge but also have extensive

experience and sharpness to quickly handle any potential situations that may arise forthe enterprise

2.1.5.2 The duties of value-added tax accounting

From the moment the company is established, the tax accounting department is

responsible for declaring and paying business tax Throughout the company's

operation, the tax accounting department will perform specific tasks as follows:

- Collect and organize invoices and documents arising from the enterprise for tracking

and recording purposes;

- Prepare monthly and quarterly tax reports and submit taxes for the company;

- Prepare financial reports, enterprise income tax reports, personal income tax reports,

and year-end tax reports;

- Address directly any issues that arise with the tax authorities;

- Verify and reconcile VAT invoices with input and output statements from each

facility;

- Monthly, compile a summary report of VAT output tax for the entire company and

classify it by tax rate;

- Monthly, compile a summary report of VAT input tax for the entire company based

on the allocated deduction ratio;

- Monitor the company's tax refund situation, budget payment situation, and budget

arrears;

- Reconcile tax report figures between branches and the final settlement;

- Prepare tax refund documents when issues arise;

- Prepare periodic or ad-hoc comprehensive tax reports;

- Inspect output and input invoices;

- Check the use of tax invoices and report to the tax authorities;

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- Keep abreast of legal updates, draft reports on tax-related business activities stipulated

by tax laws for implementation by the company;

- Plan VAT on enterprise income and budget payments;

- Update tracking of invoice issuance, receipt, and storage;

- Report monthly and quarterly on the use of invoices during the period and other tasks

related to the company's tax accounting

Given the complex and varied nature of these tasks, it is evident that the responsibility

of the tax accounting department within the company is substantial

2.1.6 Deductible VAT accounting

2.1.6.1 Accounting principles

According to Vietnamese accounting regulations (issued under Circular BTC), account 133 is used to reflect input value-added tax (VAT) that is deductible,

133/2016/TT-deducted, and remaining deductible for the enterprise

Accounting must separately record deductible input VAT and non-deductible input

VAT In cases where separate accounting cannot be done, the input VAT is recorded

in account 133 At the end of the period, accounting must determine the deductible

and non-deductible input VAT based on the percentage (%) of taxable turnover

compared to total sales revenue Non-deductible input VAT is then recorded as

production or business operating costs, or the cost of goods sold, depending on the

specific circumstances as stipulated by VAT laws If non-deductible input VATrelates to goods sold and unsold, it is allocated to the cost of goods sold in the

subsequent accounting period

In cases where purchased goods or services are supported by specific invoices (postalstamps, transportation tickets, etc.) indicating that VAT has been paid, the business

basis can rely on the purchased goods or services with VAT to determine the

deductible input VAT.

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Non-deductible input VAT is included in the value of purchased assets, the cost of

goods sold, or production and business expenses, depending on the specific

circumstances

The determination, declaration, settlement, and payment of input VAT must comply

with VAT laws

Input VAT deductible in a given month is declared for deduction when determining

the VAT payable for that month If the deductible input VAT exceeds the output

VAT, only the amount of input VAT payable for that month is deducted The

remaining input VAT can be deducted in subsequent tax periods or considered for tax refund according to regulations.

2.1.6.2 Documents and Accounts Used

> Used Documents:

Enterprises operating under the deduction method when selling goods or providing

services need to use the following types of invoices and documents:

VAT invoices with form number: 01GTKT0/004;

VAT declaration forms with form number: 01/GTGT;

Payment documents: Disbursement vouchers, receipts, payment vouchers

Supplementary declaration forms: Annex 01-2/GTGT

Other related documents

> Used Accounting Ledgers:

General ledger account 133 according to form number S03b-DNN

Subsidiary ledger account 133 according to form number S19-DNN

VAT ledger according to form number S25-DNN

> Structure and Content of Account 133:

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Debit Account 133 Credit

Beginning balance: The amount of VAT

input tax not yet deducted or refunded at

the beginning of the period

VAT input tax incurred VAT input tax already deducted

Transfer of VAT input tax not

deductible.

VAT input tax refunded.

Ending balance: The amount of VATinput tax still deductible, and VAT input

tax refunded but not yet refunded by the

tax authority

Account 133 — Deductible VAT, with 2 second-level accounts:

Account 1331 — Deductible VAT on goods and services: Reflects deductible input

VAT on materials, goods, and services purchased externally for use in the production

and sale of goods and services subject to VAT deduction.

Account 1332 — Deductible VAT on fixed assets: Reflects input VAT on the process

of investment, acquisition of fixed assets used in the production and sale of goods andservices subject to VAT deduction, and the process of purchasing real estate for

investment

2.1.7 Accounting for VAT payable

2.1.7.1 Accounting principles

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According to current accounting regulations, when using account 33311, the

following principles must be ensured:

(1) Actively calculate, determine, and declare the VAT payable to the state as required

by law

(2) Indirect taxes such as VAT (regardless of deduction or direct method), special

consumption tax, export tax, environmental protection tax, and other indirect taxes areessentially third-party receivables Therefore, indirect taxes are excluded from gross

revenue figures on financial statements or other reports.

(3) For refunded or reduced taxes, accounting must clearly differentiate between taxes refunded or reduced, distinguishing whether they were paid at the purchasing or

selling stage Specifically, refunded input VAT is recorded as a reduction in the

deducted VAT amount

(4) Accounting must maintain detailed ledgers to track each tax, fee, charge, and

amounts payable, paid, and still outstanding

2.1.7.2 Documents and Accounts Used

> Documents Used:

Enterprises operating under the deduction method when selling goods or providing

services need to use the following types of invoices and documents:

- VAT invoices with form number: 01GTKT0/001;

- VAT declaration forms with form number: 01/GTGT;

- Supplementary declaration forms: Annex 01-2/GTGT;

- Output VAT invoice listing;

- Payment documents: Disbursement vouchers, receipts, payment vouchers Other

related documents

> Accounts Used:

As stipulated in Circular No 133/2016/TT-BTC, to account for VAT payable,

account 3331 — VAT payable must be used This account reflects output VAT, VAT

on imported goods payable, deducted VAT, and VAT paid to the state budget

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Account 3331 — VAT payable applies to manufacturing and business units subject to

VAT deduction and those that pay taxes directly under VAT

> Structure and Content of Account 3331:

Debit Account 3331

Deductible input VAT VAT already paid to the state budget VAT on discounted sales

Ending balance on the Credit side:

Excess VAT paid, to be refunded.

Ending balance on the Debit side: VAT

payable to the state budget

In exceptional cases, account 3331 may have a debit balance The debit balance (if

any) of account 3331 reflects VAT paid exceeding the VAT payable to the State, or it

may reflect VAT paid that has been exempted, reduced, or refunded but not yet

executed

Account 3331 comprises two level 3 accounts:

Account 33311 - Output value-added tax: Used to reflect output VAT, input VAT

deducted, VAT on sales refunded or discounted, VAT payable, paid, and still payable

on products, goods, and services consumed within the period

Account 33312 - VAT on imported goods: Used to reflect VAT on imported goods

payable, paid, and still payable to the state budget.

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2.1.8 Pay taxes and declare VAT

2.1.8.1 Principles of calculating and declaring Value Added Tax (VAT)

Taxpayers must calculate and determine the amount of tax payable to the State

budget, except in cases determined by the tax authority or according to the provisions

of Articles 37 and 38 of the Tax Management Law.

Taxpayers must accurately, honestly, and fully declare all contents in the tax

declaration form to the tax authority according to the template prescribed by the

Ministry of Finance and submit all supporting documents in the tax declaration

dossier.

For taxes declared on a monthly, quarterly, provisional quarterly, or annual basis, if

no tax obligation arises during the tax period or the taxpayer is entitled to tax

incentives, exemptions, or reductions, the taxpayer still has to submit the tax

declaration dossier to the tax authority as prescribed

Taxpayers temporarily ceasing production and business activities and not incurring

tax obligations are not required to submit tax declaration dossiers for the period of

temporary cessation of business activities In cases where taxpayers cease business

activities not within the calendar year or fiscal year, they still have to submit annual

tax settlement dossiers.

The currency for tax declaration is the Vietnamese Dong In cases of declaring taxes

related to exploitation activities, crude oil exports, and natural gas, the currency is the

US Dollar (USD)

There are two forms of VAT declaration: Monthly declaration and Quarterly

declaration

According to Circular 151/2014/TT-BTC dated October 10, 2014, enterprises

determine whether to declare quarterly or monthly based on the revenue from sales of

goods and provision of services in the immediately preceding year Quarterly tax

declaration applies to revenues from the immediately preceding year below 50 billion Vietnamese Dong, and if the immediately preceding year comprises 12 months,

otherwise monthly declaration applies In cases where taxpayers commence business

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operations, they declare VAT quarterly; once the enterprise operates for 12 months, itcan decide whether to declare monthly or quarterly based on the revenue of the

calendar year (with 12 months) Enterprises determine whether to declare monthly orquarterly according to regulations without the need for registration or notification to

the tax authority If eligible taxpayers under quarterly VAT declaration wish to switch

to monthly declaration, they must send a notice (form 07/GTGT issued with Circular151/2014/TT-BTC) to the tax authority directly managing no later than the deadlinefor submitting the VAT declaration for the first month of starting monthly VAT

declaration.

2.1.8.2 Tax declaration dossier

The tax declaration dossier includes the declaration form and related documents used

as a basis for taxpayers to declare and calculate taxes to the tax authority

Taxpayers must use the prescribed tax declaration form and annexes issued by the

Ministry of Finance, without altering the format, adding, subtracting, or changing theposition of any items in the tax declaration form For certain types of documents in

the tax dossier for which the Ministry of Finance has not issued templates, compliancefollows the relevant laws

Tax declaration dossier for deduction method includes:

- VAT declaration form No 01/GTGT issued with Circular 26/2015/TT-BTC;

- List of goods and services sold using form No 01-1/GTGT issued with Circular

26/2015/TT-BTC;

- List of invoices and documents for purchased goods and services using form No

01-2/GTGT issued with Circular 26/2015/TT-BTC;

- List of goods and services subject to 0% tax rate using form No 01-3/GTGT issued

with Circular 26/2015/TT-BTC;

- List of VAT already paid on business revenue, construction, installation, real estate

sales outside the province using form No 01-5/GTGT issued with Circular

26/2015/TT-BTC;

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Allocation of VAT to the locality where the main office is located and to production

and business establishments not required to maintain accounting records using form

No 01-6/GTGT

Allocation of VAT payable to localities with inter-provincial construction and

installation works using form No 01-7/GTGT

Starting from January 1, 2015, according to Law No 71/2014/QH13 dated November

26, 2014, taxpayers are not required to submit Annex 01-1/GTGT and Annex

02-1/GTGT when declaring taxes.

Tax declaration dossier for direct method:

VAT declaration directly on VAT form No 03/GTGT

Or VAT declaration directly on revenue form No 04/GTGT with Annex 04-1/GTGT.2.1.8.3 Deadline for submitting VAT tax declaration documents:

The deadline for submitting monthly VAT tax declaration documents is no later thanthe 20th (twentieth) day of the following month in which the tax liability arises

The deadline for submitting quarterly VAT tax declaration documents, provisional

declarations for the quarter, is no later than the 30th (thirtieth) day of the following

quarter in which the tax liability arises

The deadline for submitting VAT tax declaration documents is no later than the 30th

(thirtieth) day of the first month of the Gregorian calendar year.

The deadline for submitting VAT tax declaration documents for each occurrence of

tax liability is no later than the 10th (tenth) day from the date the tax liability arises

The deadline for submitting annual tax settlement documents is no later than the 90th(ninetieth) day from the end of the Gregorian calendar year or fiscal year

The deadline for submitting tax settlement documents for cases of enterprise division,separation, merger, consolidation, ownership form conversion, dissolution,

termination of operations is no later than the 45th (forty-fifth) day from the date of the

decision on the implementation of division, separation, merger, consolidation,

ownership form conversion, dissolution, termination of operations by the enterprise

2.1.9 VAT finalization

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All businesses across all economic sectors (except small and medium-sized businessesthat pay tax based on predetermined revenue levels) are required to prepare and

submit annual VAT tax settlements to the tax authorities

Businesses conduct VAT tax settlements according to the following procedures:

The VAT tax settlement year is based on the Gregorian calendar year, and the

deadline for businesses to submit tax settlements to the tax authorities shall not

exceed 60 days from December 31 of the VAT tax settlement year.

In the event of business mergers, consolidations, divisions, dissolution, bankruptcy,

the respective businesses must also settle VAT taxes with the tax authorities within 45 days from the date of the decision on merger, consolidation, division, dissolution, or

VAT tax settlement Businesses must accurately declare all relevant items and figures

in the VAT tax settlement form; submit the VAT tax settlement document using formnumber 11/GTGT issued along with Circular No 26/2015/TT-BTC dated February

27, 2015, by the Ministry of Finance, to the local tax authority where the business is

registered for VAT within the specified timeframe If a business applies a financial

settlement period different from the Gregorian calendar year, it still needs to settle

VAT taxes according to the Gregorian calendar year

Businesses are responsible for paying any outstanding VAT taxes to the state budget

within 10 days from the date of submitting the VAT tax settlement report Any

overpayment can be offset against the VAT tax payable for the subsequent period or

refunded if the business meets the criteria for VAT tax refunds.

Businesses bear responsibility for the accuracy of VAT tax settlement figures If a

business reports inaccurately or engages in VAT tax evasion, it will be subject to

penalties according to the law

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2.2 Research method

2.2.1 The method of data collection

Researching the process of journal entry, document circulation, document issuance,

and document receipt for entry into the accounting ledger, as well as into the Misa

software used by accounting staff Investigating the company's sales policies and thetypes of taxes currently applicable within the company

Implementation method of VAT accounting:

Observing the work process of accounting staff to gather relevant information for the research topic Obtaining the organizational structure, accounting system, labor roster, and financial reports of the company for the past three years.Gathering VAT purchase

and sales invoices, along with related documents relevant to the research topic

2.2.2

Collecting information related to the company's management structure and laborsituation from the Accounting Department

Gathering information on assets, capital sources, and business results from annual

accounting reports at the Accounting Department.

Collecting accounting documents, ledgers, and data related to VAT accounting

from the Accounting Department

Researching relevant information on VAT accounting in textbooks, documents,

standards, laws, regulations, etc., available on the internet Selecting necessary

documents to serve the research purpose

Collecting information and data related to the VAT accounting process, includingdeductible VAT, payable VAT, and handling accounting errors, through documentsystems and ledgers provided by the Accounting Department

Data analysis and processing methodsComparative method: Primarily comparing and contrasting the financial data ofthe years 2020, 2021, and 2022 to observe changes over the years From this,

observations can be made regarding the company's operational performance in

production and business

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Descriptive method: Describing the process of VAT accounting and addressing

issues related to handling errors in VAT accounting transactions

To reflect the reality of the company, the research project has utilized the

company's document system and ledgers to illustrate and integrate while applyingstatistical and descriptive methods

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CHAPTER 3: CURRENT SITUATION OF VAT ACCOUNTING AT GIA

KHIEM CONSULTANT COMPANY3.1 History and development about Gia Khiem company Limited3.1.1 The process of formation and development

3.1.2

Type of operation: One-member limited liability companyTax code: 0314190295

Representative: NGO XUAN QUANG

Registered business address: 637/73/10 Quang Trung, Ward 11, Go Vap District, Ho Chi Minh City, Vietnam

Founding: 2017-01-09Operating status: ActiveEnglish name: Gia Khiem Consultant Company LimitedAbbreviated name: Gia Khiem Consultant Company LimitedBusiness registration: Management consulting activities

Gia Khiem Consultant Company, founded in 2017 by Mr Ngo Xuan Quang, has beenoperating for seven years, providing expertise in various fields Company services

encompass support for tax declaration and finalization, consultancy on tax-related issues, guidance on customs procedures and policies, as well as advice on legal

matters concerning human resources, labor, and wages Additionally, the firm specializes in assisting with the preparation of business registration documents, and

investment licenses, and providing tax and legal advice about commercial salescontracts, management contracts, loans, operating leases, sales contracts, agencyagreements, ventures, and technology transfers, also offers consultancy on issuesrelated to business dissolution

Company's organizational structure

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Board of directors

Administrative Business Department Financial Accounting Department

Diagram 3.1.2: Company’s organizational structureBoard of directors: General management of the company

Business Department: Advises and provides opinions to the company's Board ofDirectors on product distribution to markets for businesses

Financial Accounting: The department is tasked with carrying out the company's

accounting work, proposing solutions and conditions to create capital sources for business needs, investment, and development, assisting the director in financial supervision, and leveraging the company's financial resources in accordance with

financial and accounting laws It conducts checks and supervises the use andprotection of the company's assets The Chief Accountant is responsible to the Board

of Directors and the law for the assigned or delegated tasks

Administrative Department: Plans the work of the agency in each stage Receives andprocesses internal tasks of the enterprise Drafts documents, archives, issues

documents, maintains legally binding seals, and is responsible to the Board of

Directors and the law for legal matters Plans recruitment and recruits personnel.

Company’s accounting system

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