E-commerce Tax: Marketplaces Withhold Taxes, Sellers Still Need Revenue Reconciliation

Effective July 1, 2025, e-commerce marketplaces with integrated payment functions in Vietnam, including Shopee, Lazada, Tiki, and TikTok Shop, are required to withhold, declare, and remit taxes on behalf of sellers, reducing their administrative burden. However, this does not mean accounting has become any simpler. With marketplace tax withholding now built into the payment process, businesses must ensure that revenue, platform fees, and withheld taxes are accurately recorded for marketplace revenue reconciliation, financial reporting, and tax compliance. This is also one of the most common challenges businesses overlook when adapting to Vietnam's new e-commerce tax regulations.

1. What Decree 117/2025/ND-CP changed in the seller's cash flow

Effective July 1, 2025, Decree 117/2025/ND-CP requires e-commerce platforms with integrated payment functions to withhold, declare, and remit value-added tax (VAT) and personal income tax (PIT) on behalf of sellers before transferring their sales proceeds. This marks a significant shift in how e-commerce tax is administered in Vietnam.

The most important change is not the tax rate, but the timing of the withholding. Under Article 5, marketplace tax withholding takes place as soon as a transaction is successfully confirmed and payment is accepted, rather than at the end of the tax period or when the marketplace settles funds. As a result, the e-commerce tax liability arises at the point of sale, meaning the amount businesses receive has already been reduced by the applicable tax withholding.

Rates are applied to the revenue of each transaction:

 

If a platform cannot determine whether a transaction involves goods or services, the highest applicable tax withholding rate must be applied. Full details are provided in Decree 117/2025/ND-CP.

Two operational details are worth noting. First, marketplaces report the taxes they have withheld on a monthly basis. Second, for cancelled or returned orders, previously withheld taxes are offset against the following filing period. Both create timing differences between the figures reported by the marketplace and those recorded by the seller, making accurate marketplace revenue reconciliation essential.

2. Are Sellers Fully Relieved of Their Tax Obligations Once the Marketplace Withholds Tax?

The answer is no. While sellers no longer need to file e-commerce tax returns for taxes already withheld by the marketplace, they are still responsible for managing and reconciling their financial data.

Under Decree 117/2025/ND-CP, sellers are not required to declare or pay VAT and PIT again for transactions subject to marketplace tax withholding. However, they remain responsible for providing accurate tax registration information to the marketplace and for fulfilling any other applicable tax obligations, such as special consumption tax, environmental protection tax, or natural resource tax. For sales made through platforms without integrated payment functionality, sellers are still responsible for registering, filing, and paying their own e-commerce tax.

The biggest shift is that while tax filing obligations have been reduced, the need for marketplace revenue reconciliation has increased. Because marketplace tax withholding is applied to each transaction before funds are transferred, sellers receive only the net settlement amount. Businesses therefore need to reconcile their gross revenue with marketplace fees, taxes withheld, and the final payout to ensure accurate accounting records, reliable financial reporting, and proper tax compliance.

3. Three Common Mistakes in Marketplace Revenue Reconciliation

3.1. Recording revenue based on the net payout

Under Decree 117/2025/ND-CP, the revenue for each transaction is the gross sales amount the seller earns before platform fees and marketplace tax withholding are deducted. The amount transferred by the marketplace is simply the remaining balance after these deductions, not the transaction's actual revenue.

When businesses record the net payout as revenue, they understate revenue, fail to capture platform fees accurately, and may overlook the e-commerce tax already remitted on their behalf. As a result, the Profit and Loss (P&L) statement no longer reflects the true scale of the business or its operating performance.

3.2. Combining Withheld Taxes with Platform Fees

Platform fees are operating expenses paid for using the marketplace's services. By contrast, marketplace tax withholding represents taxes that the marketplace remits to the tax authority on the seller's behalf under Decree 117/2025/ND-CP. These are fundamentally different items and should be accounted for separately.

If both are grouped under a single "marketplace deductions" category, marketplace revenue reconciliation becomes much more difficult. It also makes it harder to verify the amount of e-commerce tax withheld by the marketplace when preparing tax filings or responding to requests from the tax authorities.

3.3. Overlooking cancelled and returned orders

Under Decree 117/2025/ND-CP, taxes withheld on cancelled or returned orders are offset against the following filing period rather than adjusted immediately. As a result, the tax records reported by the marketplace may not align with the transaction data for the same accounting period.

If businesses record cancelled or returned orders without reconciling the corresponding tax adjustment in the following period, discrepancies will accumulate over time. For businesses with high return rates, these timing differences can materially affect accounting records and year-end Financial statements.

4. Revenue thresholds and refund rights: why the annual figure must tie out

Effective January 1, 2026, household businesses and individual sellers with annual revenue of VND 1 billion or less are exempt from VAT and personal income tax (PIT). At the same time, Vietnam's presumptive tax regime will be abolished, requiring these taxpayers to transition to a self-declaration and self-payment system. Under Article 10 of Decree 117/2025/ND-CP, sellers whose taxes have already been withheld through marketplace tax withholding may claim a refund if their total annual revenue remains below the tax threshold and they have overpaid e-commerce tax during the year.

Claiming that refund, however, requires more than simply understanding the regulations. It depends on accurate marketplace revenue reconciliation. For businesses selling across multiple marketplaces or sales channels, each platform may have its own reporting format, settlement cycle, and tax records. As a result, calculating total annual revenue is far more complex than adding up monthly payouts. Only by reconciling marketplace data with tax withholding records can businesses accurately determine their e-commerce tax position and support a tax refund claim when eligible.

5. What data infrastructure does this require?

With marketplace tax withholding now built into the e-commerce tax process, businesses need more than just tax records - they need a structured data management system that supports accurate reconciliation. This is especially important for businesses selling across multiple marketplaces or sales channels, where each platform has its own fee structure, settlement cycle, and reporting format.

To ensure accurate marketplace revenue reconciliation, businesses should make sure their data systems can:

• Separate gross revenue, platform fees, taxes withheld by the marketplace, and net payouts for every transaction.

• Reconcile marketplace-issued tax withholding statements with detailed transaction records by category (goods, services, and transportation).

• Standardize tax identification numbers (TINs) or other tax identifiers across all marketplace accounts to avoid errors in marketplace tax withholding.

• Record cancelled orders, returns, and related tax offsets in the correct reporting period.

• Consolidate revenue across all sales channels by calendar year to determine the correct revenue threshold and e-commerce tax obligations.

6. Genbook: Marketplace data mapped to accounting standards

Since marketplace tax withholding became mandatory, the challenge for businesses is no longer just complying with e-commerce tax regulations but managing the underlying data. Each marketplace uses its own reporting format, settlement cycle, and deduction structure. Without standardized data, businesses spend significantly more time on marketplace revenue reconciliation, financial reporting, and supporting tax compliance when needed.

Genbook consolidates sales data from multiple marketplaces into a single platform, automatically separating gross revenue, platform fees, taxes withheld, and net payouts at the transaction level. The data is then standardized to align with accounting standards, enabling businesses to streamline reconciliation, prepare accurate financial statements, and generate supporting records for tax filings or refund claims.

Try Genbook free for one month and simplify marketplace revenue reconciliation with standardized e-commerce data.

Data source: https://vanban.chinhphu.vn/?pageid=27160&docid=213883