Revenue under 500 million VND: using invoices may incur penalties amid contested interpretations

Tax authorities in several localities have issued notices requiring households and individual businesses with annual revenue of 500 million VND or less not to use electronic invoices, to cancel registered invoices, and will impose penalties if they continue to use them. Experts interviewed by the media said the approach lacks a clear legal basis and creates practical risks for taxpayers.

Local notices and the “500 million VND” threshold

According to a notice from the Tax Office Center 4 in Hue, households and individuals with annual revenue up to 500 million VND fall under a tax-exempt category and, as there is no regulation allowing electronic invoicing for this group, they are not allowed to use electronic invoices or issue invoices for each transaction.

Other local tax offices have issued similar but worded differently notices. In Dak Lak province, Center 7 stated: “If not subject to electronic invoicing but continues to use it, this will be deemed illegal invoicing and punished under the law.”

Experts: no clear prohibition in current regulations

Mr. Nguyen Van Thuc, Chairman of Keytas Accounting and Tax Co., Ltd., said the approach raises multiple issues and risks in practice.

He pointed out that under Decree 123/2020/ND-CP and Decree 70/2025/NĐ-CP, when selling goods or providing services, organizations and individual businesses must issue invoices. In his view, there is no regulation that bans household businesses from issuing invoices.

Mr. Thuc also said the 500 million VND figure is used as a threshold for determining tax obligations, not as a legal basis to restrict invoice use. He cited Decree 68/2026/NĐ-CP and Circular 18/2026/TT-BTC for this interpretation.

He further noted that Circular 20/2026/TT-BTC allows, in certain cases where purchases are made from entities without invoices, enterprises to prepare a cost listing (Form 02/TNDN) to calculate reasonable expenses. This mechanism, he said, also applies to households with annual revenue of 500 million VND or less.

Mr. Thuc added that it is difficult to verify whether a household truly belongs to the under-500-million group because many households estimate revenue when registering, and there is no clear evidence to confirm the classification. He argued that restricting or banning invoice use for this group is therefore not consistent with current rules and is impractical, potentially affecting their ability to secure orders and harming the business environment.

He urged tax authorities to issue nationwide unified guidance to remove ambiguities and to encourage households to issue invoices and declare taxes properly.

Call for unified guidance and flexibility

Mr. Le Van Tuan, Director of Keytas Accounting and Tax Co., Ltd., said there is currently no legal document stating that households with revenue under 500 million VND are prohibited from using electronic invoices.

Under existing rules, he said, when purchasing from this group, buyers can prepare a listing to calculate costs instead of relying on invoices. However, he questioned why electronic invoices are not allowed, given that listings can already be used when invoices are not available.

Mr. Tuan argued that electronic invoicing helps tax authorities monitor revenue more easily, while listings prepared by households are harder to verify. For buyers, he said, listings take time and are considered less reliable, which can make it harder for households that do not issue electronic invoices to win customers.

Tax advisory association: penalty claim is not correct

At a tax seminar organized by VOV on April 14, Ms. Nguyen Thi Cuc, President of the Vietnam Tax Advisory Association, said the claim that households with revenue under 500 million VND per year issuing invoices violate the law and are subject to administrative penalties is not correct. She said unified guidance is needed to avoid misinterpretations across localities.

She also emphasized that restricting invoice issuance for sellers limits their access to customers. At the same time, relying on listings increases social costs due to additional procedures, paperwork, and risks.

Ms. Nguyen Thi Cuc reiterated the need for unified guidance to prevent different interpretations among local tax authorities.