How To Make Invoices For Pferring Old Fixed Assets Equipment

Q: our company is a general taxpayer and belongs to industrial enterprises.

Our company purchased old fixed assets from other units, and the other party issued 2% common VAT invoices. For technical reasons, our company failed to install and use the equipment.

Our company is now selling the old equipment to our customers.

。

Excuse me, our company sells the batch equipment.

Do you sell 17% VAT invoices, or 2% VAT invoices on secondhand goods?

A: according to the notice of the Ministry of Finance and the State Administration of Taxation on the application of value-added tax policies for the application of low value-added tax and simple measures for certain goods (fiscal 9 [2009] No. 9), the term "second-hand goods" refers to goods with some value in use (including old cars, old motorcycles and old yachts) but not used by them.

Two, according to the notifications issued by the State Administration of Taxation on the management of simple value added tax policies (No. 90 of the national tax Letter No. 2009), "two, taxpayers should issue ordinary invoices for the sale of second-hand goods, and shall not issue their own invoices or tax invoices on behalf of the tax authorities."

Three.

The Circular of the State Administration of Taxation on the policy of the rate of debrief tax collection (fiscal 2014 [57]) stipulates: "first, the Ministry of Finance and the State Administration of Taxation on the application of a low value-added tax rate and a simple method of levying a value-added tax policy for some goods" (fiscal 9 [2009] 9). In the second items (1) and (two), "according to the simplified method, the value added tax is reduced by half according to the 4% levy rate", and is adjusted to "reduce the value added tax by 2% according to the simplified method in accordance with the 3% levy rate."

Therefore, if you pfer the above old fixed assets equipment to the sale of second-hand goods, you can reduce the value added tax by 2% according to the simple method and issue the general invoice according to the 3% levy rate.

Related links:

In view of the increasing possibility of tax risk in pnational pactions of large enterprises, Jiangsu provincial tax bureau timely issued a hint to local large enterprises. Since 2015, with the introduction of BEPS (tax base erosion and profit pfer) action plan, pnational paction tax risks have attracted the attention of all countries. Relevant large enterprises should pay close attention to nine major issues and effectively control tax risks.

First, we should pay close attention to the "four matches" of the allocation of pnational tax sources so as to prevent "three mismatches".

The "four match" is that the market contribution should match the global profit distribution of the group, and the function commitment of the enterprise should match the profit return. The Chinese government's input, matching, cost saving and enterprise profit return should match, and the social image and the tax contribution of the multinational company should match.

The "three mismatches" are the mismatch between contract processors and high-tech enterprises, the mismatch between group profit trends and the profit trend of Chinese subsidiaries, the mismatch between the high compliance of investment home countries and the low compliance of investment locations.

Two, we are highly concerned about the legal obligations provided by tax related materials.

Taxpayers' preservation and provision of true and complete tax information in accordance with the law are not only the obligations prescribed by the tax law, but also the basis for self compliance and tax enterprise cooperation.

It is suggested that pnational taxpayers, especially those with relatively high degree of control, encourage the headquarters staff to communicate directly with China when tax authorities warn of risks or tax inspections, and provide support for the tax authorities to make a correct judgement and take reasonable tax treatment.

It is particularly necessary to remind that taxpayers refuse to provide information in the tax inspection section, and the court will not accept it in administrative proceedings.

Three, we should pay close attention to the quality of preparation for the same period.

The BEPS action plan has made significant adjustments to the data management during the same period, requiring taxpayers to provide country reports and main documents, including the global organization structure, business description, group finance and tax situation of pnational corporations, as well as information on income, profits and income tax in each country (region), so as to provide information for the tax authorities to assess the pfer pricing risk of the enterprises as a whole.

It is suggested that multinational taxpayers should reduce information data incompleteness and inaccuracy in the preparation of information in the same period, and there are major deficiencies in the comparability analysis, so as to encourage enterprises to provide tax related information in global group information and different tax jurisdiction.

Enterprises with poor quality of data preparation in the same period reflect inadequate internal control of risks, and tax authorities will raise the risk ranking of their pfer pricing surveys.

Four, we should pay close attention to the accurate positioning of enterprise functions.

The core of the BEPS report is to emphasize that taxation should be consistent with the essence and value creation of economic activities. The direct expression of the economic activities and value creation of enterprises is the functions they perform, and thus determine the profit distribution of enterprises in the value chain.

To remind pnational taxpayers, the function orientation should be based on the actual economic activities. When Chinese subsidiaries have already undertaken the functions of domestic sales and R & D, they should not simply stick to the old system, but still position them as "contract manufacturers with low profit returns". Enterprises should take the initiative to strengthen communication with the tax authorities, adjust the profit distribution in accordance with the functional orientation and manage the risk of pfer pricing investigation afterwards.

Five, we must pay close attention to the economic essence of business restructuring.

The global business restructuring of MNCs is becoming more and more frequent. In accordance with the regulations of China's tax law, pnational taxpayers are reminded that business restructuring should be based on reasonable commercial purposes and restructure the public.

The company's internal integrity decision-making procedures and process information are corroborated, including board resolutions, business restructuring evaluation reports, payment vouchers, and communication records with relevant trading parties. The functions involved and the pfer of related assets should be fully compensated. After the reorganization, the new profit distribution pattern should be consistent with the economic activity's essence and value creation pattern.

Six, we must pay close attention to the reasonable compensation for localized research and development and marketing.

The BEPS action plan clearly points out that the development, promotion, maintenance, protection and utilization of intangible assets belong to the value creation of intangible assets, which is the basis for sharing the excess profits of intangible assets.

Remind multinational taxpayers that localization pformation and upgrading of Chinese subsidiaries on the basis of the original technology of the group, or localization marketing, maintenance and construction of customer network for Group brands or trademarks are intangible asset value creation. We should give full consideration to the actual work done by subsidiaries in the field of R & D, marketing, asset allocation, personnel allocation, daily performance and other aspects, and their contribution to the value of intangible assets. In the group value chain allocation, we should allocate reasonable profits to the intangible assets that subsidiaries should share.

Seven, we should pay close attention to the impact of FATCA and CRS implementation on enterprise internal control.

More and more countries are involved in the undertaking and implementation of the FATCA and OECD's automatic exchange standard for financial account (CRS). Through mutual disclosure, tax authorities in various countries will learn about their residents' financial information in foreign countries, including the account holder's name, address, tax identification number, balance at the end of the year, dividends, interest and assets income of classified statistics, and the tax cooperation between countries will be more pragmatic and enterprising.

To remind pnational taxpayers, we should fully understand the challenge of financial account information exchange to the internal control of enterprises' pnational operation risks, especially regulate the management of financial accounts related to dividends, interest and assets income. We should make good distribution of pnational profits according to the principle of taxation right and the essence of economic activities, avoid accumulation of profits in the low tax land or Tax Haven Company accounts, leading to the risk of adjustment after investigation.

Eight, we must pay close attention to the issue of international tax compliance in the "going global" process.

In 2014, China's capital export volume has exceeded the amount of capital input. With the implementation of the strategy of "one belt and one road", more enterprises will go abroad.

Remind the "going out" enterprises to set up the international tax compliance consciousness in the layout of the global value chain. First, we must understand and follow the tax laws and regulations of the host country. Secondly, the overseas income should return to China according to the regulations of our country, make good use of the tax credit policy to reduce the tax burden of cross border operation; once again, we must communicate well with the tax authorities of the host country and the resident country, reasonably divide the distribution of pnational profits and tax sources, avoid the risk of being investigated afterwards; finally, we should make full use of the tax agreement, enjoy the preferential treatment of the agreement, and encounter unfair tax treatment abroad, so that we can understand the need to start the process of mutual consultation and safeguard our rights and interests.

Nine, we should pay close attention to the legal responsibilities, professional ethics and ethics of tax related intermediaries.

Intermediaries play an important role in helping enterprises comply with compliance, but there may also be radical tax planning or unreasonable accountability for entrusted matters.

To remind pnational taxpayers, when entrusting agents to handle tax related matters, they should clarify their legal responsibilities and pay attention to the professional ethics and integrity of intermediary organizations. They do not deliberately plan radical tax products to make enterprises at a major risk; do not provide opinions or suggestions that may cause major misunderstanding without verifying the real data and actual conditions; do not stick to conventions, and have no knowledge of the latest international tax rules such as market value contribution, intangible asset value creation, economic essence, and the views of Chinese tax authorities, so that communication between enterprises and tax authorities is passive.