The VAT refund process is one of the important procedures that helps businesses recover cash flow in a timely manner and ensure compliance with tax laws. According to the General Department of Taxation, in 2023 alone, the tax authority resolved more than 16,800 VAT refund records with total amount over 132,000 billion VND, showing that the need for tax refunds is huge and the implementation process needs to be mastered by businesses. Understanding the conditions, documents and implementation steps according to Circular 80/2021/TT-BTC not only helps businesses reduce legal risks, but also creates financial advantages in business operations.
Overview of VAT refund process
Procedure VAT refund Not only is it an administrative procedure, but it is also an important part of the tax management mechanism in Vietnam. Understanding the VAT refund process will help businesses reduce financial pressure, maintain cash flow and improve international competitiveness. Especially from 2025, when VAT Law No. 48/2024/QH15 effective, along with the Circular 80/2021/TT-BTC continue to be applied, businesses need to understand clearly to avoid mistakes and optimize their legal rights.
What is the VAT refund process?
Completion process VAT are all the steps that businesses need to take to get a refund from the State for the value added tax that has been paid but has not been fully deducted or is eligible for a refund according to regulations. According to Articles 13 and 14 of the Law on Value Added Tax No. 48/2024/QH15, businesses that pay tax by the deduction method are entitled to a tax refund when they have input tax that has not been fully deducted, or when exporting goods and services.
The VAT refund process according to Circular 80/2021/TT-BTC includes 3 main stages:
- Prepare documents: Enterprises collect complete invoices, payment documents, contracts and related papers as prescribed.
- Submit application: Submit tax refund application via the General Department of Taxation's electronic information portal or directly at the tax authority.
- Tax authority processing: Tax authority receives, checks, compares documents and issues tax refund decisions within the prescribed time limit.
The role of the VAT refund process
The VAT refund process acts as a “bridge” between businesses and tax authorities. It ensures that businesses receive tax refunds on time and to the right recipients, while helping tax authorities control and prevent fraud. This role is reflected in four main aspects: encouraging exports, creating tax fairness, improving cash flow and enhancing transparency in financial management.
| Aspect | Process content | Implications for business |
| Export promotion | VAT refund for exported goods and services | Reduce costs, increase international competitiveness |
| Tax Justice | Avoid double taxation at home and abroad | Businesses keep reasonable profits |
| Cash flow and capital | Timely tax refund helps quick capital turnover | Reduce financial pressure, increase investment capacity |
| Transparent management | Procedure for requesting valid documents and records | Enterprises improve governance and comply with the law |
Conditions for VAT refund
Before entering each stage of the VAT refund process, businesses need to have a firm grasp of the legal requirements and required documents. This is the “passport” for the tax refund application to be received and processed by the tax authority on time. If one of these requirements is missing, the entire VAT refund process may be delayed or rejected.
Conditions for VAT refund application
According to the VAT Law No. 48/2024/QH15, the VAT refund process only applies to businesses that pay tax using the deduction method. The main subjects include:
- Enterprises exporting goods and services.
- Enterprises with new investment or expansion projects.
- Enterprises have input VAT that has not been fully deducted during the period.
This shows that not all organizations and individuals are eligible for VAT refund procedures. Only specific cases with legal activities and permitted by law are eligible.
Conditions on documents and invoices
A valid VAT refund dossier in the VAT refund process must be accompanied by a strict system of documents. Enterprises need to have legal VAT invoices, bank payment documents, export contracts, and cleared customs declarations for exported goods. These documents are both evidence of transactions and legal basis for tax authorities to assess.
If documents are missing or invalid, the VAT refund process will be returned, prolonging the processing time. Therefore, this is a prerequisite for businesses to be considered for a tax refund.
Conditions on declaration time
Circular 80/2021/TT-BTC clearly stipulates that enterprises must submit tax refund dossiers within three years from the date of arising of the tax liability. input VAT not yet deducted. Compliance with this deadline helps businesses preserve their rights. On the contrary, if the deadline is exceeded, the documents will no longer be legally valid, and the VAT refund process will not be accepted.
See more articles at: What is VAT deduction? Some latest related regulations 2025
Conditions on the legality of business activities
Enterprises are only allowed to participate in the VAT refund process when their import-export, production or service provision activities are consistent with their registered and licensed industries (if they are subject to specialized management). This is a condition to ensure that tax refunds are only applied to legal activities, limiting the risk of tax fraud.
| Condition group | Main content | Implications for business |
| Applicable objects | Enterprises paying tax by deduction method, with export, investment or deduction surplus | Define the scope of eligible objects |
| Documents and invoices | Valid VAT invoice, bank payment, customs declaration, export contract | Ensure transparency and have a legal basis for tax refund consideration |
| Time of declaration | Submit application within 3 years from the date of arising of undeducted input tax | Avoid losing benefits due to overdue |
| Legitimate business | Operate in accordance with registered industry, with specialized management license if required | Tax refund guarantee only applies to transparent business operations |
Detailed VAT refund process
The VAT refund process is not just a simple administrative procedure but a series of steps with strict legality, regulated in Tax Administration Law No. 38/2019/QH14 and Circular 80/2021/TT-BTC. Businesses need to have a firm grasp of each stage in the VAT refund process to avoid errors, ensure their rights and shorten the time it takes to process documents.
Prepare before submitting application
The first step in the VAT refund process is to prepare all relevant documents and records. Enterprises must review input VAT invoices, foreign trade contracts, customs declarations (for import and export), along with bank payment documents.
In addition, it is necessary to prepare a list of invoices and vouchers for purchased and sold goods and services and a tax refund request form. This is a prerequisite for the documents in the VAT refund process to be accepted by the tax authority without being returned.
For example: A seafood export company in Can Tho wants to refund input VAT on raw materials purchased domestically. The company needs to prepare VAT invoices for raw materials, export contracts with Japanese partners, customs declarations and payment documents in USD via banks. Only when these documents are complete can the VAT refund process continue. This is an important step in the VAT refund process, because missing documents can also cause the application to be returned.
Submit tax refund application
After preparation, the enterprise proceeds to submit the tax refund application. According to Circular 80/2021/TT-BTC, the application can be submitted directly to the tax authority or via the electronic system on the General Department of Taxation's Information Portal.
Correctly implementing the online VAT refund process also helps businesses easily track the processing progress and limit errors, reduce travel costs, and allow businesses to track the status of file processing right on the system.
Note: VAT refund dossiers must be submitted within 3 years from the date of occurrence of the unredeemed input tax. If the deadline is exceeded, the tax refund benefits will no longer be available.
Receiving and processing documents
Once the application is submitted, the tax authority will receive and process it according to two mechanisms:
- Refund first, check later: applies to low-risk applications with complete documentation. In this case, businesses can get a tax refund within 6 working days.
- Check first, refund later: applies to applications with signs of risk and need verification. Processing time may take up to 40 working days.
In the VAT refund process, if the dossier is incomplete, the tax authority will issue a notice requesting additional information. Enterprises must complete it within the prescribed time limit, otherwise the dossier will be rejected.
Example: An enterprise importing electronic components has a tax refund dossier but lacks bank payment documents. The tax authority will request additional documents within 10 days. If the enterprise supplements them in time, the VAT refund process will continue, otherwise it will be rejected.
| Stage | Content of implementation | Meaning for business |
| Prepare documents | Collect invoices, customs declarations, contracts, payment documents, tax refund requests | Create a solid legal basis |
| Submit application | Submit directly to the tax authority or online via the TCT Portal | Convenient, transparent, easy to follow |
| Receiving & processing | Tax authorities check, classify and refund within 6–40 days | Ensure transparency and compliance with legal regulations |
Benefits of following the correct VAT refund procedure
The VAT refund process is not only an administrative procedure but also an important financial support tool for businesses. Correct and complete implementation of the VAT refund process helps businesses save costs, improve competitiveness, and at the same time ensure transparency in accounting and financial activities.
Direct financial benefits
The first benefit of complying with the VAT refund process is improved cash flow. When businesses receive timely tax refunds, this capital can be reinvested in production and business. This is especially important for capital-intensive industries such as textiles, seafood, and electronics. A clear and transparent VAT refund process helps businesses avoid capital misappropriation, thereby improving financial efficiency.
Improve competitiveness
Correctly implementing the VAT refund process means reducing the cost burden for businesses. When costs are saved, product prices are reduced, and Vietnamese goods will have an advantage in the international market. This is an important factor that helps businesses participate more deeply in the global supply chain.
Enhance transparency and governance
A strict VAT refund process requires businesses to store and manage complete documents and invoices. This is not only a legal requirement but also contributes to building a more effective and transparent internal management system. Standardizing this process also helps businesses avoid legal risks and tax fraud.
Application in long-term management strategy
The VAT refund process does not stop at “refunding” businesses, but is also the basis for long-term financial planning. Businesses can rely on the tax refund schedule to plan working capital, forecast cash flow, and calculate production and business costs. This is the foundation for increasing initiative and reducing financial risks in the long term.
| Aspect | Main content | Practical implications for business |
| Finance | Fast-turnover tax refund source | Reduce capital pressure, increase reinvestment capacity |
| Compete | Standard VAT refund process helps reduce costs | Enhance competitiveness in international markets |
| Transparent governance | Require full documents and invoices | Limit legal risks, enhance reputation with partners & the State |
| Long-term management | As a financial planning tool | Support sustainable development strategy |
Illustrative example: Enterprise applies VAT refund process
A textile company in Binh Duong specializing in exporting to the EU market has submitted a VAT refund application according to Circular 80/2021/TT-BTC. In 2023, this enterprise incurred more than VND 20 billion in input VAT that had not been deducted from imported raw materials.
Thanks to the preparation of complete documents (valid VAT invoices, customs declarations, bank payment documents and foreign trade contracts), the documents were classified by the tax authority as “refund first – check later”. Within just 7 working days, the enterprise was fully refunded the 20 billion VND tax.
This amount of money helps the company quickly turn around capital to import raw materials for new orders, while reducing financial pressure and not having to borrow short-term bank loans. This case demonstrates that mastering and complying with the VAT refund process brings practical results, directly improving cash flow and increasing competitiveness in the international market.
Conclude
The VAT refund process is not only a series of administrative procedures, but also an important financial tool to support businesses in optimizing costs, improving cash flow and maintaining competitiveness. When mastering and properly implementing the VAT refund process, businesses not only comply with the law, but also minimize the risk of violations or being charged back, and at the same time effectively exploit the preferential policies that the State offers for production and business activities.
In the context of a volatile global economy, the VAT refund process poses challenges regarding accuracy and transparency in declaration and accounting, while also opening up opportunities for businesses to improve their financial management systems and affirm their reputation in the international market. Complying with the VAT refund process, preparing complete documents and understanding the conditions will help businesses shorten the time for tax refund.
If your business wants to ensure full compliance with the new regulations related to the VAT Refund Process, from preparing documents, accounting for vouchers to handling arising situations, MAN – Master Accountant Network always ready to accompany. With a team of experts knowledgeable in tax law, constantly updated with new documents and applying modern management technology, MAN is committed to providing the most accurate, transparent and economical tax refund solutions for businesses.
Contact information:
MAN – Master Accountant Network
- Address: No. 19A, Street 43, Tan Thuan Ward, Ho Chi Minh City
- Hotline: 0903 963 163 – 0903 428 622
- E-mail: man@man.net.vn
