Income Tax Planning For Personal Investment (2)

The partnership refers to a profit making organization established by the partnership law in China, which is concluded by a partnership agreement, which is jointly invested, CO operated, shared income, shared risks, and is jointly and severally liable for partnership debts.

The partnership profit and loss in partnership shall be allocated and shared by the partners in accordance with the proportion stipulated in the partnership agreement.

After the establishment of a partnership, the ratio of investors to obtain profits and responsibilities has been determined.

Like the sole proprietorship enterprise, since January 1, 2000, the enterprise income tax has been levied on the partnership, and the investment income of the partners has been levied on individual income tax according to the production and business income of the individual industrial and commercial households.

However, as a partnership has two and more than two partners, each partner pays only his personal income tax on the proceeds he receives.

For example, a partnership has 5 partners, and each partner has a contribution ratio of 20%.

The production and operation income of this year is 300 thousand yuan, and the partners are divided equally according to their capital contribution ratio.

In this way, the individual income tax payable by each partner is 300000 x 20% * 3% - 6. 70% (personal income tax quick deduction) = 14250 yuan, and after tax income is 60000-14250 = 45750 yuan.

The actual tax burden of each partner in the partnership is 23.75% (14250 / 60000 x 100%).

The main way to set up a private enterprise is to set up a limited liability company, which is jointly invested by more than two shareholders. Each shareholder has limited liability to the company with the amount of capital contribution it subscribes, and the company is responsible for its debts with all its assets.

As an investor, the individual shareholder obtains the corresponding equity income by the proportion of his capital contribution to the paid in capital of the enterprise.

As an enterprise legal person, the profits of an enterprise shall be paid by the enterprise income tax.

When an investor obtains dividends from an enterprise, he pays 20% of his personal income tax on dividends and dividends.

In this way, the dividends earned by investors will bear double tax burden.

Because the rights and interests enjoyed by a single investor are only a part of all the rights and interests of the enterprises, their responsibilities are only part of the total responsibility of the enterprises.

However, since the proceeds are part of the proceeds, the income tax burden paid by the enterprise is also borne by the individual investor.

To give a simple example, individual investors account for 50% of the private enterprise's contribution, the pre tax income of the enterprise is 120 thousand yuan, the income tax rate is 33%, the enterprise income tax is 120000 x 33% = 39600 yuan, the after tax income is 120000-39600 = 80400 yuan, and the individual investor obtains the dividend from 80400 to 50% yuan = 40200 yuan.

The income from dividends and bonuses is paid by personal income tax at 20% tax rate, so that the personal income tax paid by investors is 40200 x 20% = 8040 yuan, after tax income is 40200-8040 = 32160 yuan, the actual tax burden is (39600 x 50% + 80 40) / (120000 x 50%) x 100% = 46.4%.

Generally speaking, under the same income, individual businesses, individual proprietorships and partnership enterprises have the same tax burden, and the tax burden of private enterprises is the heaviest.

However, the three types of enterprises, such as sole proprietorship, partnership and private enterprise, are legal entities. They have advantages in the purchase of invoices and the identification of taxpayers. They are relatively easy to carry out business, and have a wide scope of operation and enjoy some preferential policies of national tax revenue.

In the three forms of enterprise, private enterprises appear in the form of limited liability companies, with only limited liability and relatively small risks.

Especially for individual proprietorship enterprises, there are still some problems such as VAT general taxpayer recognition and other related laws and regulations which are not sound and difficult to operate, which aggravate the risks of such enterprises.

The partnership has many advantages, such as raising funds and so on.

Compared with the limited liability company, the lower tax burden is beneficial to the development of individual proprietorship and partnership.

When making investment plans, individual investors should take full account of all factors and choose the best investment plan.