VAT refunds for investment projects are the largest cash amount many FDI enterprises receive back from the budget during the plant construction phase — and also the file most often delayed for poor preparation. Under VAT Law 48/2024/QH15 and Decree 181/2025/ND-CP, refund conditions are written more clearly, but the file discipline the tax authority requires is also higher: input tax tracked per project, charter capital contributed on schedule, and every large invoice traceable to a real transaction.
Refund conditions for investment projects
An enterprise qualifies for consideration when it simultaneously meets the core conditions: the project is in the investment phase of a new investment project (or a qualifying expansion project) and has not commenced production or business operations; total uncredited input VAT on goods and services purchased for the project reaches VND 300 million or more; the enterprise has contributed charter capital in full on the schedule registered in the investment file — the “blocking gate” most enterprises trip on, because under-contributed charter capital removes refund eligibility however large the input tax; and declaration and crediting are performed per project, separated from the enterprise’s existing business operations (if any).
The point to stress is that refunds are assessed per project, not per company: an enterprise simultaneously operating a running plant and building a new project must separate the new project’s entire input tax into its own tracking system from the first invoice. Rebuilding that separation retroactively after one or two construction years is the most expensive task in any project refund file.
The dossier, and cases moved to audit-before-refund
The refund dossier comprises: the refund request and related tax returns; the schedule of input invoices and documents for the project with bank payment evidence; the project’s legal file (investment registration certificate, land file, construction permit); charter capital contribution evidence on schedule; and major procurement files (contracts, acceptance records, equipment import documents). The document chain of a purchase must close from contract to payment and putting into use for the project — one broken link suspends the corresponding tax amount.
Not every file travels the “refund first, audit later” route: under the risk management of Tax Administration Law 108/2025/QH15, high-risk files are moved to an on-site audit before refund — typically first-time refund claims, refund amounts abnormally large against project scale, input invoices concentrated in few suppliers or suppliers with risk signs, and project figures diverging from equipment import customs data. Being rerouted does not mean being refused; it means the payment timeline extends by the audit period, and the enterprise must price that scenario into its cash flow in advance.
Cash flow planning while awaiting the refund
A plant project’s input VAT often accumulates to several percent of total investment capital — for a large project, an amount equal to an entire investment item. The project cash flow plan should default to a prudent assumption: count only the most certain refund portion into short-term funding sources, set the expected refund timeline on the audit-before-refund scenario (much longer than refund-first), and maintain a standby loan or bridge credit line for the waiting period instead of letting contractors wait for payment on the refund schedule.
Operationally, enterprises should file refunds by completed project phase (once input tax has passed the threshold and that phase’s file is closed) rather than in one lump at project end: multiple smaller, clean refund files build a good compliance history with the tax authority, lower the chance of a high-risk classification in later rounds, and bring cash back earlier into the project’s capital cycle.
Frequently Asked Questions
1. What are the VAT refund conditions for an investment project under the new guidance?
Under VAT Law 48/2024/QH15 and Decree 181/2025/ND-CP: the project is in its investment phase and not yet operating; uncredited input VAT used for the project reaches VND 300 million or more; charter capital has been contributed in full on the registered schedule (under-contribution blocks the refund); and input tax is declared and tracked separately per project.
2. What must the dossier include to avoid delays?
The dossier includes the refund request, related returns, the schedule of project input invoices and documents with bank payment evidence, the project legal file (investment certificate, land, construction), charter capital contribution evidence, and major procurement files closed from contract to acceptance. To avoid delays, separate input tax per project from the start and file refunds by completed project phase.
3. In which cases is a file moved to audit-before-refund?
Under the risk management of Tax Administration Law 108/2025/QH15: first-time refunds, refund amounts abnormally large against project scale, invoices concentrated in suppliers with risk signs, or project figures diverging from customs and banking data. Rerouting does not mean refusal, but the payment timeline extends by the audit duration — factor it into cash flow planning.
4. How should enterprises plan cash flow while awaiting the refund?
Plan on the prudent scenario: assume the waiting time of an audit-before-refund case, do not count the refund into mandatory funding for contractor payment milestones, maintain a bridge credit line, and file refunds by project phase so cash returns earlier and a good compliance history is built for later rounds.
This article has been quality-reviewed by the FLAW AI Legal Council
