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Circular No. 132/2018/TT-BTC dated December 28, 2018 of the Ministry of Finance providing guidance on accounting regimes of extra-small enterprises

Date: 12/28/2018

MINISTRY OF FINANCE
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SOCIALIST REPUBLIC OF VIETNAM
Independence - Freedom - Happiness 
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No. 132/2018/TT-BTC
Hanoi, December 28, 2018
 
CIRCULAR
PROVIDING GUIDANCE ON ACCOUNTING REGIMES OF EXTRA-SMALL ENTERPRISES
Pursuant to the Law on Accounting No. 88/2015/QH13 dated November 20, 2015;
Pursuant to the Law on Support for Small- and Medium-sized Enterprises No. 04/2017/QH14 dated June 12, 2017;
Pursuant to the Government’s Decree No.174/2016/ND-CP dated December 30, 2016 elaborating certain articles of the Law on Accounting;
Pursuant to the Government's Decree No. 39/2018/ND-CP dated March 11, 2018 elaborating on certain articles of the Law on Support for Small- and Medium-sized Enterprises;
Pursuant to the Government's Decree No. 87/2017/ND-CP dated July 26, 2017, defining the functions, tasks, powers and organizational structure of the Ministry of Finance;
Upon the request of the Director of the Department of Accounting and Audit Management and Supervision,
The Ministry of Finance hereby promulgates the Circular providing guidance on accounting regimes of extra-small enterprises. 
Chapter I
GENERAL PROVISIONS
Article 1. Scope
This Circular provides instructions for bookkeeping, formulation and representation of financial reports of extra-small enterprises. Determination of tax obligations of these enterprises to the State Budget shall be subject to provisions of laws on taxes.
Article 2. Subjects of application
1. Subjects of application to this Circular are extra-small enterprises, including those paying corporate income taxes (CIT) by using the method of calculation of CIT based on assessable income and the method of calculation of CIT based on the CIT-to-sales ratio (%).
2. Criteria for determination of extra-small enterprises adopting accounting regimes prescribed herein shall be subject to legislation on taxes.
Article 3. Application of accounting regimes
1. Extra-small enterprises paying their CIT calculated according to the method of calculation of CIT based on assessable income shall apply the accounting regime specified in Chapter II herein.
2. Extra-small enterprises paying CIT calculated according to the method of calculation of CIT based on the CIT-to-sales ratio (%) shall apply the accounting regime specified in Chapter III herein or may opt to apply the accounting regime specified in Chapter II herein.
3. Extra-small enterprises may opt to apply the accounting regime to medium and small enterprises which is enshrined in the Circular No. 133/2016/TT-BTC dated August 26, 2016 of the Ministry of Finance provided that such regime is appropriate for business characteristics and managerial requirements of these enterprises.
4. Extra-small enterprises shall have the burden of applying the uniform accounting regime in a financial year. Change of the applied accounting regime may only be made in the beginning of the following financial year.
Article 4. Accounting documents
1. Contents of accounting documents, formulation and signing of accounting documents of extra-small enterprises shall be subject to provisions laid down in Article 16, Article 17, Article 18 and Article 19 of the Law on Accounting and specific instructions given herein.
2. Contents and forms of invoices, procedures for formulation, management and use of invoices (including electronic invoices) shall be subject to laws on taxes.
3. Extra-small enterprises may design forms, charts and templates of accounting documents appropriate of their own accord for their business activities provided that they ensure clarity, transparency, and are easily checked or controlled (except for sales invoices).   In case where extra-small enterprises do not autonomously design these forms, charts or templates for their own use, they may use those and methods of design of accounting documents according to the instructions given in the Appendix 1 hereto.
Article 5. Accounting books
1. Contents of accounting books, financial accounting systems, opening, recording of entries into, closure, storage and custody of, and correction of data in, accounting books of extra-small enterprises shall be subject to provisions of Article 24, Article 25, Article 26 and Article 27 of the Law on Accounting, and specific instructions given herein.
2. Extra-small enterprises may, of their own accord, design forms, charts and templates of accounting books appropriate for their business activities provided that they ensure clarity, transparency, and are easily checked or controlled.   In cases where extra-small enterprises do not autonomously design these forms, charts and templates for their own use, they may use those and bookkeeping methods according to the instructions given in an Appendix hereto.
Article 6. Accounting currency unit
Extra-small enterprises shall apply regulations on accounting currency units prescribed in Article 10 of the Law on Accounting and Article 4 of the Government’s Decree No.174/2016/ND-CP dated December 30, 2016 elaborating on certain articles of the Law on Accounting.
Article 7. Regulations on archival, custody and safekeeping of accounting records
1. Accounting documents, accounting books and other accounting records shall have to be deposited with enterprises for posting entries on daily basis; determine tax obligations of extra-small enterprises to the state budget, and inspection and control tasks of these enterprises’ owners, tax authorities and other relevant competent authorities.
2. Storage, custody and archival of accounting records by extra-small enterprises shall be subject to the provisions of the Law on Accounting and the Government’s Decree No.174/2016/ND-CP dated December 30, 2016 elaborating on certain articles of the Law on Accounting.
3. Extra-small enterprises may store and archive accounting documents, accounting books and other accounting records by electronic means as per the Law on Accounting.
Article 8. Design of accounting machinery and accountants
1. Extra-small enterprises shall be charged with performing accounting duties without being bound to appoint the chief accountant. Extra-small enterprises paying CIT in the CIT-to-sales ratio (%) can, at their discretion, undertake accounting tasks under the provisions of Chapter III herein.
2. Recruitment and appointment of a staff member as an accountant for an extra-small enterprise shall be required not to violate provisions laid down in Article 19 of the Government’s Decree No.174/2016/ND-CP dated December 30, 2016 elaborating on certain articles of the Law on Accounting.
3. Extra-small enterprises shall be entitled to sign contracts with accounting service providers to hire accounting or chief accountant services in accordance with legislation in effect. The list of accounting service providers conforming to accounting service business requirements shall be published and updated on a periodic basis on the Web Portal of the Ministry of Finance.
Chapter II
ACCOUNTING REGIMES OF EXTRA-SMALL ENTERPRISES PAYING THEIR CIT CALCULATED ACCORDING TO THE METHOD OF CALCULATION OF CIT BASED ON ASSESSABLE INCOME
SECTION 1. ACCOUNTING DOCUMENTS
Article 9. Accounting documents
1. Extra-small enterprises paying CIT calculated according to the method of calculation of CIT based on assessable income shall use accounting documents listed hereunder:
No.
Description
Code
I
Accounting documents prescribed herein
1
Cash receipt
Form No.01-TT
2
Cash payment note
Form No.02-TT
3
Goods-received note
Form No.01-VT
4
Goods dispatch note
Form No.02-VT
5
Fixed asset handover and receipt report
Form No.01-TSCD
6
Wage, salary and other income payment worksheet
Form No.01-LDTL
II
Accounting documents prescribed by other laws
1
VAT or sales invoice
 
2
Slip of payment of taxes to the State Budget
 
3
Bank’s Debit note
 
2. Forms, charts or templates of accounting documents, contents and methods of formulation of accounting documents, referred to in clause 1 of this Article, shall be subject to instructions given in the Appendix 1 “Forms or templates and methods of formulation of accounting documents” hereto attached.
3. In addition to accounting documents subject to instructions given in clause 1 of this Article, extra-small enterprises may opt to use accounting documents referred to in the Circular No. 133/2016/TT-BTC of the Ministry of Finance dated August 26, 2016 providing instructions for accounting regimes of medium and small enterprises in order to meet requirements concerning management of business activities of these enterprises.
SECTION 2. BOOKKEEPING ACCOUNTS
Article 10. Bookkeeping accounts
Extra-small enterprises paying CIT calculated according to the method of calculation of CIT based on assessable income shall use the list of booking accounts, contents, accounting structure and principles, methods of making entries to record certain major business transactions according to the instructions given in the Appendix 2 "Chart of accounts” hereto in order to record and reflect business transactions classified by specific economic activities.  
SECTION 3. ACCOUNTING BOOKS
Article 11. Accounting books
1. Extra-small enterprises paying CIT calculated according to the method of calculation of CIT based on assessable income may use accounting books listed hereunder:
No.
Description
Code
I
General accounting books
 
1
Ledger
Form No. S01-DNSN
II
Detailed accounting books
 
1
Book of details of raw materials, instruments, products and commodities
Form No. S02-DNSN
2
Fixed asset book
Form No. S03-DNSN
3
Book of details of payments to buyers or sellers
Form No. S04-DNSN
4
Book of details of payments of liabilities
Form No. S05-DNSN
5
Book of details of sales (applicable to extra-small enterprises paying CIT calculated according to the withholding method
Form No. S06a-DNSN
6
Book of details of sales (applicable to extra-small enterprises paying CIT calculated according to the direct method)
Form No. S06b-DNSN
7
Book of business expenses
Form No. S07-DNSN
8
Book of withholding VAT
Form No. S08-DNSN
9
Book of details of output VAT
Form No. S09-DNSN
10
Bank deposit book
Form No. S10-DNSN
2. Forms, charts or templates of accounting books, contents and methods of posting of entries in accounting books, referred to in clause 1 of this Article, shall be subject to instructions given in the Appendix 3 “Bookkeeping forms or templates and methods” hereto attached.
3. In addition to accounting books subject to instructions given in clause 1 of this Article, extra-small enterprises may opt to use detailed accounting books or other forms of general accounting books referred to in the Circular No. 133/2016/TT-BTC of the Ministry of Finance dated August 26, 2016 providing instructions for accounting regimes of medium and small enterprises in order to meet requirements concerning management of business transactions of these enterprises and tax obligations to the State Budget.
SECTION 4. FINANCIAL REPORT
Article 12. Purposes of financial reports
1. Financial reports are used for providing information about financial and business situations of extra-small enterprises, and for meeting managerial requirements of owners of these enterprises and state regulatory authorities.
2. Financial reports shall provide data and information about extra-small enterprises, including:
- Assets;
- Liabilities;
- Owner’s equity;
- Revenues and incomes;
- Expenses;
- Profit, loss and distribution of business income.
Article 13. Financial reporting system
1. On an annual basis, extra-small enterprises paying CIT calculated according to the method of calculation of CIT based on assessable income shall have to formulate financial reports and addenda thereto listed hereunder:
No.
Description
Code
I
Financial reports
1
Financial statement
Form No. B01 - DNSN
2
Income statement
Form No. B02 - DNSN
II
Addenda to financial reports
1
Balance sheet
Form No. F01-DNSN
2
Review report on fulfillment of obligations to the State Budget
Form No. F02-DNSN
2. Forms and templates, contents and methods of formulation of financial reports and addenda to financial reports, referred to in clause 1 of this Article, shall be subject to instructions given in the Appendix 5 “Forms and templates and methods of formulation of financial reports” hereto.
3. In addition to financial reports specified in clause 1 of this Article, extra-small enterprises may have the option of using financial reports stated in the Circular No. 133/2016/TT-BTC of the Ministry of Finance dated August 26, 2016 in order to serve the tasks of managing their business activities as well as determine tax obligations to the State Budget.
Article 14. Responsibilities and duration of formulation and submission of financial reports
1. On an annual basis, extra-small enterprises paying CIT calculated according to the method of calculation of CIT based on assessable income shall have to formulate financial reports and addenda thereto under the provisions of clause 1 of Article 13 herein.
2. Financial reports and addenda thereto used by extra-small enterprises must be submitted to tax authorities having direct authority over these enterprises and registration bodies not later than 90 days from the end date of a financial year, and must be deposited with these enterprises according to laws on accounting in order to serve inspection and audit activities upon the request of competent regulatory authorities.
Chapter III
ACCOUNTING REGIMES OF EXTRA-SMALL ENTERPRISES PAYING CIT IN THE CIT-TO-SALES RATIO (%)
Article 15. Accounting documents
1. Extra-small enterprises paying CIT in the cit-to-sales ratio (%) shall use accounting documents listed hereunder:
No.
Description
Code
I
Accounting documents prescribed herein
 
1
Cash receipt
Form No. 01-TT
2
Cash payment note
Form No. 02-TT
3
Goods-received note
Form No. 01-VT
4
Goods dispatch note
Form No. 02-VT
5
Wage, salary and other income payment worksheet
Form No. 01-LDTL
II
Accounting documents prescribed by other laws on taxes
 
1
VAT or sales invoices
 
2
Slip of payment of taxes to the State Budget
 
3
Bank’s Debit note
 
2. Forms, charts or templates of accounting documents, contents and methods of formulation of accounting documents, referred to in clause 1 of this Article, shall be subject to instructions given in the Appendix 1 “Forms or templates and methods of formulation of accounting documents” hereto attached.
In addition to accounting documents referred to in clause 1 of this Article, extra-small enterprises may opt to use accounting documents referred to in clause 1 of Article 9 herein or the Circular No.133/2016/TT-BTC of the Ministry of Finance dated August 26, 2016 providing instructions for accounting regimes of medium and small enterprises in order to meet requirements concerning management of business activities of these enterprises.
3. Sales invoices
- Sales invoice is an accounting documents recording completed sales of goods or services.  Sales invoices may be either VAT invoices or sales receipts depending on legislative regulations on taxes applied to specific methods of payment of VAT employed by extra-small enterprises, including:
+ With respect to extra-small enterprises paying VAT according to the withholding method, sales invoices issued to clients shall be VAT invoices.
+ With respect to extra-small enterprises paying VAT according to the income method, sales invoices issued to clients shall be sales receipts.
- Sales invoices issued by extra-small enterprises to clients upon sale of goods or services shall serve as a basis for determining their CIT obligations to the State Budget.
4. Documents evidencing payment of wages, salaries and other incomes to employees shall serve as a basis for determining PIT obligations of these enterprises’ employees to the State Budget.
5. Documents evidencing payment of taxes to the State Budget shall serve as a basis for assessing fulfillment of tax obligations of extra-small enterprises to the State Budget.
Article 16. Accounting methods
1. If extra-small enterprises paying CIT calculated according to the method of calculation of CIT based on the CIT-to-sales ratio (%) do not wish to open accounts, they shall not be bound to do so, but may make entries by using the single-entry bookkeeping method in accounting books (in a way of only recording business transactions into entries or accounts for monitoring purposes and not needing to post corresponding and opposite entries to different accounts) in order to keep track of revenues and incomes, taxes payable to the State, salaries, wages or other amounts retained from salaries or wages, etc. for the purposes of determining their tax obligations to the State Budget.
2. If extra-small enterprises paying CIT calculated according to the method of calculation of CIT based on the CIT-to-sales ratio (%) wish to use bookkeeping accounts like those paying CIT calculated according to the method of calculation of CIT based on assessable income in order to meet the demands of management of their business activities, they shall be entitled to do so by applying regulations set forth in Chapter II hereof.
Article 17. Accounting books
1. Extra-small enterprises paying CIT calculated according to the method of calculation of CIT based on the CIT-to-sales ratio (%) shall be required to create accounting books to keep track of revenues and other incomes, taxes payable to the State, salaries, wages and other amounts retained from salaries and wages, etc., for the purposes of determining their tax obligations to the State Budget according to the list hereunder:
No.
Description
Code
1
Book of details of sales
Form No. S1-DNSN
2
Book on monitoring of payment of salaries, wages and contributions associated with salaries and wages of employees
Form No. S2-DNSN
3
Book of details of raw materials, instruments, products and commodities
Form No. S3-DNSN
4
Book on monitoring of discharge of tax obligations to the State Budget
Form No. S4-DNSN
2. Forms, charts or templates of accounting books, contents and methods of posting of entries in accounting books, referred to in clause 1 of this Article, shall be subject to instructions given in the Appendix 4 “Bookkeeping forms or templates and methods” hereto attached.
3. In addition to accounting books subject to instructions given in clause 1 of this Article, extra-small enterprises paying CIT calculated according to the method of calculation of CIT based on the CIT-to-sales ratio (%) may opt to use detailed accounting books or other forms of general accounting books referred to in the Circular No. 133/2016/TT-BTC of the Ministry of Finance dated August 26, 2016, providing instructions for accounting regimes of medium and small enterprises in order to meet requirements concerning management of business transactions of these enterprises and tax obligations to the State Budget.
Article 18. Financial reports
1. Extra-small enterprises paying CIT calculated according to the method of calculation of CIT based on the CIT-to-sales ratio (%) shall not be required to submit financial reports to tax authorities.
2. Extra-small enterprises CIT calculated according to the method of calculation of CIT based on the CIT-to-sales ratio (%) shall implement reports required under laws on taxes. Duration and submission of preparation of reports shall be subject to laws on taxes.
3. In addition to legislative regulations on taxes, based on information about sales, salaries, wages and other contributions associated with salaries and wages, etc., extra-small enterprises may prepare accounting reports for business management and administration purposes.
4. If extra-small enterprises CIT calculated according to the method of calculation of CIT based on the CIT-to-sales ratio (%) choose to apply the accounting regime specified in Chapter II herein to meet their demands of management of their business activities, they shall have to prepare financial reports in accordance with regulations in force. Financial reports shall not need to be submitted to tax authorities, but shall be archived and deposited in accordance with regulations in force, and shall be used by these enterprises for inspection and audit purposes upon the request of competent authorities.
Chapter IV
IMPLEMENTATION ORGANIZATION
Article 19. Carryforward of balances in accounting books
1. If extra-small enterprises applying accounting regimes specified the Circular No. 133/2016/TT-BTC change to the accounting regime specified in Chapter II hereof, they shall be required to transfer account balances as follows: 
- Balances in A/C 112 – Bank deposits and A/C 1281 - Term deposits shall be carried forward to A/C 111 – Cash.
- Balances in A/C 1331 – Withholding VAT on goods and services, A/C 1332 – Withholding VAT on fixed assets shall be carried forward to A/C 1313 – Withholding VAT;
- Balances in A/C 136 - Internal receivables, A/C 138 – Other receivables, A/C 141 – Advances shall be carried forward to A/C 1318 – Other debts receivable;
- Balances in A/C 152 – Raw materials, A/C – Instruments and devices shall be carried forward to A/C 1521 – Raw materials and instruments;
- Balances in A/C 154 – In-progress production and business costs shall be carried forward to A/C 1524 – In-progress production and business expenses;
- Balances in A/C 155 – Finished products, A/C 156 – Goods and A/C 157 – Goods on consignment shall be carried forward to A/C 1526 – Finished products and goods including details provided to meet the managerial demands;
- The difference between Debit balances in A/C 211 – Fixed assets and Credit balances in A/C 214 - depreciation of fixed assets shall be carried forward to Debit balances in A/C 211 – Fixed assets;
- Balances in A/C 334 – Payables to employees shall be carried forward to A/C 3311 – Employee’s payables;
- Balances in A/C 3382 – Trade Union’s budget, A/C 3383 – Social insurance, A/C 3384 – Health insurance and A/C 3385 – Unemployment insurance shall be carried forward to A/C 3312 – Amounts retained from salaries and wages;
- Balances in A/C 331 – Payables to sellers, A/C 335 – Costs payable, A/C 336 – Internal payables, A/C 3381 – Other payables, A/C 3386 – Acceptance of deposits or pledges, A/C 3387 – Unearned sales, A/C 3388 – Other payables, A/C 3411 – Borrowed funds and A/C 3412 – Finance lease debts shall be carried forward to A/C 3318 – Other debts payable;
- Balances in A/C 33311 – Output VAT and A/C 33312 – VAT on imports shall be carried forward to A/C 33131 – VAT payable;
- Balances in A/C 3332 – Special consumption duties, A/C 3333 – Import and export duties, A/C 3335 – PIT, A/C 3336 – Natural resource taxes, A/C 3337 – Land levies and rents, A/C 33381 – Environmental protection taxes and A/C 33382 – Other taxes, A/C 3339 – Fees, charges and other payables shall be carried forward to A/C 33138 – Other taxes, fees, charges and other payables to the State;
- Balances in A/C 4211 - Undistributed after-tax profits in the preceding year and A/C 4212 - Undistributed after-tax profits in the current year shall be carried forward to A/C 4118 - Undistributed after-tax profits.
2. If other business transactions recorded in detail to related accounts are in breach of this Circular, they must be adjusted in accordance with provisions hereof.
Article 20. Entry into force
1. This Circular shall enter into force from February 15, 2019 and apply in the financial year starting on or after April 1, 2019.
2. In case where legislative documents used as references in this Circular have been amended or supplemented or replaced, new versions of these documents shall apply.
3. Ministries, sectoral administrations, People’s Committees, Departments of Finance, and Tax Departments of provinces and centrally-affiliated cities, shall be responsible for instructing extra-small enterprises to implement this Circular.
4. In the course of implementation hereof, if there is any difficulty arising, the Ministry of Finance should be promptly informed to find possible solutions./.
 
 
PP. MINISTER
DEPUTY MINISTER
(Signed and sealed)




Do Hoang Anh Tuan
(This translation is for reference only)



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