Who need to pay VAT…
Entities or individuals who engaged in below taxable behaviors with in the territory of the People’s Republic of China.
--Sell goods or provide processing, repair, installation service or related sell services.
--Importation of goods.
--Provide taxable services.
--Transfer intangible assets.
--Sell immovable properties.
What is the normal VAT rates…
--13% Sale of goods. Additional, there are 9%, 0% tax rate for agricultural product and exportation good sales, respectively.
--9% Service of communications, constructions, transportation, postal, transfer of intangible of assets and immovable assets, building.
--6% Finance and insurance, consulting service, leasing, hotel, warehouse and other modern service.
How to calculate VAT payable…
For general VAT taxpayer, VAT taxpayalbe calculate as below.
Output VAT- Input VAT- Additional deduction if have.
If in a certain period, input VAT is large than output VAT, the excess input VAT can be carried forward for set-off in the following periods.
For Non-general VAT taxpayer, use collection tax rate 3% to calculate VAT tax payable as below.
(Revenue excluding VAT)*3%
Please note that from Q1 2019 to Q4 2021, small or mediumsized Non-general VAT taxpayers could be exempted from VAT taxation if their quarterly VAT revenue no more than RMB300,000.
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