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Major Tax Categories for FIEs and Foreigners

Value-added Tax

As a type of turnover tax, value-added tax (VAT) is levied on the increased value of commodities at different stages of production or circulation, or on the value-added of commodities. All enterprises and individuals engaged in the sale or import of goods or the provision of processing, repair or maintenance services in China have to pay VAT.

(a)  In China, VAT payers are divided into general taxpayers and small-scale taxpayers on the basis of their operation scale and accounting and auditing system, with different methods of tax computation.

Small-scale taxpayers are taxpayers without a sound accounting and auditing system whose taxable value of sales is below the prescribed standards, namely, Rmb500,000 million or less for taxpayers engaged in the production of goods or provision of taxable services, and taxpayers engaged principally in the production of goods or provision of taxable services and also in the wholesaling or retailing of goods, and less than Rmb800,000 for other taxpayers.

General taxpayers mainly refer to enterprises whose annual taxable sales value exceeds that of small-scale taxpayers. Small production enterprises with a sound accounting and auditing system may be classified as general taxpayers. However, individuals, non-enterprise units, and enterprises that do not regularly engage in taxable operations are classified as small-scale taxpayers even if their annual taxable sales value exceeds the standards for small-scale taxpayers.

(b)  Method of Computation

  • Small-scale taxpayer

    VAT on the sale of goods or taxable services payable by small-scale taxpayers is calculated by a simple method on the basis of the sales value (excluding tax payable) and the prescribed 3% tax rate (irrespective of industrial or commercial operations) without offset or deduction for input VAT. Special VAT invoice may not be issued. The formula for the computation of VAT is as follows:

    Tax payable = sales value x tax rate (3%)

    According to Article 28 of the Detailed Rules for the Implementation of the Interim Regulations on VAT promulgated in 2008: “The criteria for small-scale taxpayers mentioned in Article 11 of these Regulations are as follows: (1) Taxpayers engaged in the production of goods or the provision of taxable services, and taxpayers engaged principally in the production of goods or provision of taxable services and also in the wholesaling or retailing of goods, with an annual taxable sales amount of Rmb500,000 or less; (2) Taxpayers other than those prescribed in the previous paragraph with an annual taxable sales amount of Rmb800,000 or less. The term ‘taxpayers engaged principally in the production of goods or provision of taxable services’ mentioned in paragraph (1) of this Article refers to taxpayers whose annual production of goods or provision of taxable services account for more than 50% of their annual taxable sales amount.” These new criteria for small-scale taxpayers took effect on 1 January 2009. The VAT tax rate for small-scale taxpayers has been adjusted to 3% across the board since then.

  • General taxpayer

    The actual amount of VAT payable by general taxpayers is the excess amount of output VAT over input VAT. The formula for the computation of the tax payable is as follows:

    Tax payable = current output VAT – current input VAT

    Output VAT = sales value x applicable tax rate

    If the current output VAT is smaller than the current input VAT, the amount that cannot be fully set off or deducted may be carried over to the following tax period.

    According to the provisions of the Administrative Measures for the Qualification Recognition of General VAT Taxpayers which took effect on 20 March 2010, VAT taxpayers (hereinafter referred to as taxpayers) with an annual taxable sales amount exceeding the criteria for small-scale taxpayers set by the Ministry of Finance and the State Administration of Taxation should apply to the tax department for recognition as general taxpayers. Here, the annual taxable sales value refers to the cumulative sales value subject to VAT within a continuous period of 12 months or less, including sales value exempted from VAT.[1]

  • VAT on imported goods

    VAT on goods imported by taxpayers is computed on the basis of the composite assessable value and the applicable tax rate without offset or deduction for input VAT. [This applies only to VAT collected by the Customs Office. Import-related VAT (except fixed assets) not paid by importers may not be deducted for input VAT]. The formula for the computation of the tax payable is as follows:

    Tax payable = composite assessable value x applicable tax rate

    Composite assessable value = customs dutiable value + customs duty

    The composite assessable value of VAT on goods imported includes customs duty already paid. If the goods imported are subject to consumption tax, the composite assessable value should also include the consumption tax already paid.

(c)  Taxable Items and Tax Rates

(1) A tax rate of 17% applies to taxpayers who sell or import goods. (2) A tax rate of 13% applies to taxpayers who sell or import the following goods: 1. Grain and edible vegetable oil; 2. drinking water, heating, air conditioning, hot water, coal gas, liquefied petroleum gas, natural gas, methane gas, and coal products for domestic use; 3. books, newspapers and magazines; 4. feeds, chemical fertilisers, pesticides, agricultural machinery, and agricultural plastic films; and 5. other commodities specified by the State Council. (3) A zero tax rate applies to taxpayers who export goods. (4) A tax rate of 17% applies to taxpayers who provide processing, repairs and replacement services. (5) A tax rate of 11% applies to taxpayers providing services including transportation, postal and basic telecoms; a tax rate of 6% applies to taxpayers engaging in R&D and technical services, information technology, cultural and creative services, logistics and ancillary services, certification and consulting, radio, film and television, and value-added telecoms services.

(d)  Export Tax Exemption and Rebate

China implements a zero tax rate on exports. There is no export-related tax. Subject to the types of products, tax payments made in respect of the stages preceding export will be partly or fully refunded.

(e)  Special VAT Invoice

  • General taxpayers may purchase special VAT invoices from the tax authorities. Small-scale taxpayers and non-VAT taxpayers may not purchase or use such invoices.

  • General taxpayers selling taxable items must issue special VAT invoices to the buyer. However, for the sale of taxable items to consumers and the sale of duty-free goods or goods for export, no special VAT invoices have to be issued. It is also not mandatory to issue special VAT invoices for the sale of taxable items to small-scale taxpayers.

  • Special VAT invoices that are not up to specifications may not be used to claim deduction or exemption for input VAT.

(f)  Tax Liability and Payment Period

In the supply of goods or taxable services, the VAT liability arises on the day the taxpayer receives full payment for the transaction or obtains a payment voucher for the transaction. In the case of import goods, VAT liability arises on the day of customs declaration.

The payment period may be one day, three days, five days, 10 days, 15 days, one month or one quarter, to be determined by the competent tax authorities based on the amount of VAT payable by the taxpayer.

Consumption Tax

Consumption tax is a tax levied on a small number of consumer goods on top of VAT universally levied on the sale of goods. The current scope of consumption tax mainly covers cigarettes, alcoholic drinks and alcohol, firecrackers and fireworks, cosmetics, refined oil products, fine jewellery and precious stones, golf balls and equipment, high-end watches, yachts, disposable wooden chopsticks, wooden floor panels, motor vehicle tyres, motorcycles, and small motor cars. Some tax items are further divided into sub-items.

Consumption tax is included in the transaction price and is only payable on the production, subcontracted processing and importation of taxable consumer goods. Since consumption tax is included in the transaction price, it is not payable in the subsequent stages such as wholesaling and retailing. The tax is ultimately borne by consumers.

(a)  Taxpayers

Payers of consumption tax are units and individuals engaged in the production, subcontracted processing, retailing and importation of taxable consumer goods specified in the Interim Regulations on Consumption Tax of the PRC. Specifically they include state-owned enterprises, collective enterprises, private enterprises, joint-stock enterprises and other enterprises engaged in the production, subcontracted processing, retailing and importation of taxable consumer goods in China, as well as administrative units, institutions, military units, social organisations and other units, individual business operators, and other individuals. According to the Circular of the State Council on Several Issues Concerning the Interim Regulations on the Application of VAT, Consumption Tax, Business Tax, Etc. to FIEs and Foreign Enterprises, FIEs and foreign enterprises engaged in the production, subcontracted processing, retailing and importation of taxable consumer goods in China are also payers of consumption tax.

(b)  Taxable Items and Tax Rates

Items Subject to Consumption Tax and Tax Rates

Item
Tax Rate
 I.  Cigarettes (Production stage) 
     1.  Rolled cigarettes
 
         (i) Category A rolled cigarettes (priced at Rmb70 or above per carton)56% + Rmb0.003/cigarette
        (ii) Category B rolled cigarettes (priced below Rmb70 per carton) 36% + Rmb0.003/cigarette
    2.  Cigars
36%
    3.  Cut tobacco
30%
II.  Alcoholic drinks     
    1.  White spirits
20% + Rmb0.5/500g    (or 500 ml)
    2.  Yellow rice wine
Rmb240/tonne
    3.  Beer
        (i) Category A beer
Rmb250/tonne
        (ii) Category B beerRmb220/tonne
    4.  Other alcoholic drinks
10%
III.  Cosmetics 30%
IV.  Fine jewellery and precious stones
 
    1.  Gold and silver jewellery, platinum jewellery, diamonds, and diamond jewellery
5%
    2.  Other precious jewellery and precious stones
10%
V.  Firecrackers and fireworks15%
VI.  Refined oil productsRmb1.52/litre
    1.  GasolineRmb1.20/litre
    2.  Diesel oil
Rmb1.20/litre
    3.  Aviation kerosene
Rmb1.52/litre
    4.  NaphthaRmb1.52/litre
    5.  Solvent oil
Rmb1.52/litre
    6.  Lubricant oil
Rmb1.20/litre
    7.  Fuel oil
 
VII.  Motorcycles
 
    1.  With cylinder capacity of 250 ml
3%
    2.  With cylinder capacity of 250 ml or above
10%
VIII.  Small motor cars
 
    1.  Passenger cars
 
        (i) With cylinder capacity of 1.0 L or below
1%
        (ii) With cylinder capacity of over 1.0 L -1.5L
3%
        (iii) With cylinder capacity of over 1.5 L - 2 L
5%
        (iv) With cylinder capacity of over 2.0 L - 2.5 L
9%
        (v) With cylinder capacity of over 2.5 L - 3.0 L    
12%
        (vi) With cylinder capacity of over 3.0 L - 4.0 L
25%
        (vii) With cylinder capacity of over 4.0 L
40%
    2.  Medium/light-duty commercial passenger cars
5%
IX.  Golf balls and equipment
10%
X.  High-end watches
20%
XI.  Yachts10%
XII.  Disposable wooden chopsticks
5%
XIII.  Wood floor panels
5%
XIV.  Batteries (except mercury-free primary batteries, nickel-metal hydride rechargeable batteries, lithium primary batteries, lithium-ion rechargeable batteries, solar cells, fuel cells and all-vanadium redox-flow cells)
4%
XV.  Paint (except volatile organic compounds (VOCs) of less than 420 g / litre (inclusive) when applying)4%


(c)  Method of Computation

  • For tax payable by volume, the sales volume is used as the basis:

    Tax payable = sales volume x tax amount per unit

  • For tax payable by value, the sales value is used as the basis:

    Tax payable = sales value (or import value) x tax rate

  • For tax payable under the combination of by volume and by value:

    Tax payable = sales volume x tax amount per unit + sales value x tax rate

(d)  Tax Liability and Payment Period

In the sale of taxable consumer goods, the consumption tax liability arises on the day the taxpayer receives full payment for the transaction or obtains a payment voucher for the transaction. In the import of goods, it arises on the day of customs declaration.

The consumption tax payment period may be one day, three days, five days, 10 days, 15 days, one month or one quarter, to be determined by the competent tax authorities based on the amount of consumption tax payable by the taxpayer.

Customs Duty

Customs duty is levied by Customs on commercial commodities or articles entering or leaving China’s national boundaries or customs territories.

(a)  Taxpayers

Payers of customs duty on commercial commodities are consignees of imports and consignors of exports. The former have to pay import tariffs while the latter have to pay export tariffs. Payers of customs duty on articles include: incoming passengers carrying personal luggage and articles, service attendants on different modes of transport carrying personal articles, owners of gifts and personal articles that enter China through other means, and addressees of incoming personal postal articles.

(b)  Tariff Rates

China adopts a two-column tariff for imports: a general rate and a preferential rate. The general tariff rate applies to goods from countries and regions that have not signed reciprocal tariff agreements with China, while the preferential tariff rate applies to goods from countries and regions that have signed such agreements with China.

(c)  Dutiable Value

The dutiable value of imported goods in general is their CIF price while the dutiable value of exports is their FOB price.

(d)  Method of Computation

Customs duty payable is calculated by multiplying the dutiable value and quantity of the goods imported or exported by the applicable tax rate or tax amount. The formula for calculating the amount of customs duty payable is as follows:

Duty payable = quantity of taxable import or export x unit dutiable value x applicable tax rate

or

Duty payable = quantity of taxable import or export x applicable standard tax amount

(e)  Payment of Customs Duty

Taxpayers or their agents should make payment at designated banks within 15 days from the date of issuance of the customs duty payment notice by Customs.

Business Tax

Business tax is a kind of turnover tax levied on the revenue generated from the provision of taxable services, the transfer of intangible assets or the sale of immovable properties by units or individuals within the territory of China. From 2012, China began to implement business tax to VAT conversion (B2V) pilot programme in selected industries on a pilot basis, including transportation, postal services and modern services. The telecoms industry has also been included in the B2V pilot since June 2014. Currently, services subject to business tax are: construction, culture and sports, finance and insurance, taxable services (including agency and tourism), transfer of intangible assets, sale of immovable properties, and entertainment.

(a)  Taxpayers

Payers of business tax are units or individuals engaged in the provision of taxable services, transfer of intangible assets or sale of immovable properties in China as prescribed in the Interim Regulations on Business Tax of the PRC. “Units” refer to state-owned enterprises, collective enterprises, private enterprises, joint-stock enterprises and other enterprises, as well as administrative units, institutions, military units, social organisations, and other units.

(b)  Taxable Items and Tax Rates

The tax rates for business tax are set according to the roles of different trades and business operations. Specifically there are the following three tax rates:

  1. The tax rate for the taxable items of construction, and culture and sports is 3%;

  2. The tax rate for finance and insurance, taxable services, transfer of intangible assets and sale of immovable properties is 5%;

  3. The tax rate for entertainment ranges from 5% to 20%, to be determined by the provincial people's governments.

(c)  Method of Computation

The formula for computing business tax is as follows:

Tax payable = business turnover x applicable tax rate

(d)  Tax Liability and Payment Period

The business tax liability arises on the day the taxpayer receives the full amount of business proceeds or obtains a payment voucher for the proceeds.

The payment period may be five days, 10 days, 15 days, one month or one quarter, to be determined by the competent tax authorities.

(e)  Place of Tax Payment

As prescribed in relevant provisions of the business tax, payers of business tax are required to report their place of tax payment. In general, this refers to the place where a taxpayer's taxable service is provided or where his or her land and immovable property are located. The specific provisions are as follows:

  1. Taxpayers providing taxable services shall report and pay the tax to the competent tax authorities of the place where such services took place. For taxpayers providing taxable services in a different county (city) that should report and pay the tax to the competent tax authorities where such services took place but have not reported or paid the tax, the competent tax authorities where their establishment is located or domiciled shall collect the overdue tax.

  2. Taxpayers with contracted projects that straddle provinces (autonomous regions or municipality directly under the central government) shall report and pay business tax to the competent tax authorities where their establishments are located.

  3. Taxpayers transferring land-use rights or selling immovable properties shall report and pay business tax to the competent tax authorities where the land or immovable properties are located.

  4. Taxpayers transferring intangible assets other than land-use rights shall report and pay business tax to the competent tax authorities where their establishments are located.

Enterprise Income Tax

Enterprise income tax is a kind of tax levied on the income and other proceeds of domestic enterprises and business units from production and business operations.

(a)  Taxpayers

All domestic enterprises and other organisations with independent accounting within the territory of China, including the following six categories: (1) state-owned enterprises; (2) collective enterprises; (3) private enterprises; (4) associated enterprises; (5) joint-stock enterprises; and (6) other institutions that have income from production or business operations or have other incomes.

(b)  Objects of Taxation

Taxpayers are generally divided into resident enterprises and non-resident enterprises in line with international practice. This is the basis for determining whether a taxpayer has full tax liability. A resident enterprise is an enterprise incorporated in a country in accordance with its laws and regulations, or an enterprise whose office of effective management or head office is located within the territory of that country. Under the Enterprise Income Tax Law of the PRC, resident enterprises are enterprises incorporated within the territory of China in accordance with Chinese laws and regulations or with their offices of effective management within the territory of China. For example, Wal-Mart (China) and General Motors (China) registered and incorporated in China are Chinese resident enterprises. Companies registered in Britain, the Bermuda Islands and other countries and regions but whose offices of effective management are located within the territory of China are also Chinese resident enterprises. Resident enterprises have to pay enterprise income tax on their income derived from sources in and outside China.

Non-resident enterprises are enterprises that do not meet the criteria for resident enterprises under the tax laws of a country. Non-resident enterprises that have establishments or venues in China have to pay enterprise income tax on their income derived from sources in China, as well as income derived from sources outside China but is effectively connected with these establishments or venues. Non-resident enterprises that do not have any establishments or venues in China, or those that have establishments or venues in China but whose income is not effectively connected with these establishments or venues, have to pay enterprise income tax on their income derived from sources in China.

(c)  Taxable Items and Tax Rates

  • The rate of enterprise income tax is 25%.

  • Non-resident enterprises that do not have any establishments or venues in China, or those that have establishments or venues in China but whose income is not effectively connected with these establishments or venues, have to pay tax of 20% on the income derived from sources in China.

(d)  Method of Computation

Taxable income = total annual income of enterprise – (income not subject to taxation + income exempted from taxation + deductible items + losses in previous years permitted to be offset)

Tax payable = (taxable income of enterprise x applicable tax rate) – tax reductions and exemptions as stipulated in the concession provisions of the enterprise income tax law

(e)  Filing of Tax Returns

Income tax is levied on an annual basis and paid in advance in quarterly instalments. Taxpayers should file their quarterly income tax returns with the local tax authorities and pay the tax within 15 days as from the end of each quarter. They should file their annual income tax returns together with their final account statements within four months as from the end of each tax year, and make their final settlement within five months as from the end of the tax year. Any excess will be refunded and any deficiency will have to be paid.

For entities that have no establishment or venue in China but derive incomes from profits, interest, rentals, royalties and other incomes from sources in China, and for those that do have establishments or venues in China but derive incomes that are not effectively connected with such establishments or venues, the income beneficiary should be the taxpayer and the payer should be the withholding agent. The tax should be withheld from the amount of each payment by the payer. The withholding agent should, within five days, turn the amount of taxes withheld on each payment over to the State Treasury and submit a withholding income tax return to the local tax authorities.

Individual Income Tax

Individual income tax is a general term of the legal norms for the adjustment of social relations arising between tax collection offices and natural persons (residents and non-residents) in the process of the collection, payment and management of individual income tax. Individuals who have domicile in China or who have no domicile in China but have resided in China for one year or more with income derived from sources within and outside China, or individuals who have no domicile and do not reside in China or who have no domicile but have resided in China for less than one year with income derived from sources within China, are taxpayers of individual income tax. The Standing Committee of the 11th NPC adopted the decision to amend the Individual Income Tax Law at the end of June 2011, on the basis of which the threshold for tax exemption was raised to Rmb3,500 with effect from 1 September 2011.

(a)  Taxpayer and Tax Liability

  • Resident taxpayers refer to Chinese citizens and foreign nationals residing in China. They are individuals domiciled in China (who, by reason of their permanent registered address, family or economic interests, habitually reside in China); or foreign nationals, overseas Chinese, and Hong Kong, Macau and Taiwan compatriots who have resided in China for a calendar year in a tax year. Resident taxpayers have unlimited tax liabilities and have to pay individual income tax to the Chinese government on incomes from global sources.

  • Non-resident taxpayers refer to foreign nationals, overseas Chinese and Hong Kong, Macau and Taiwan compatriots who are neither domiciled nor resident in China; or foreign nationals, overseas Chinese and Hong Kong, Macau and Taiwan compatriots who are not domiciled in China and have resided in China for less than a calendar year in a tax year. Non-resident taxpayers have limited tax liabilities and are required to pay individual income tax to the Chinese government only on incomes from sources inside China.

(b)  Taxable Items, Tax Rates and Deduction Standards

  • Income from wages and salaries

    Tax payable =    taxable income x applicable tax rate – allowable deductions;

    Standard deduction Rmb3,500/month;

    Taxable income = monthly income after deducting unemployment, medical and pension insurance and provident fund payments – standard deduction

Table: Taxable Income
Table: Taxable Income
  • Tax brackets for individually-owned businesses

    Applicable to income derived by individually-owned businesses from production and business activities and income derived by enterprises and institutions from subcontracting or leasing.

Table: Tax brackets for individually-owned businesses
Table: Tax brackets for individually-owned businesses
  • Income from remuneration for labour service

    Income from the remuneration for labour service is taxable on each payment, where proportional tax rate at 20% applies. For remuneration in a single payment in excess of Rmb20,000, extra tax will be levied. For the part of taxable income exceeding Rmb20,000 but less than Rmb50,000, after calculating the tax payable, an additional 50% on the tax payable will be levied; and for the part exceeding Rmb50,000, an additional 100% on the tax payable will be levied.

  • Income from author’s remuneration

    Income from author’s remuneration is taxable on each payment for every publication or release. For remuneration received in each payment of less than Rmb4,000, a deduction of Rmb800 is allowed for expenses. For each payment of Rmb4,000 or more, a deduction of 20% is allowed for expenses and the remaining amount is the taxable income. Tax payable is computed at a rate of 20%, with a further deduction of 30% on the amount of tax payable.

    Taxable income = income from taxable item – Rmb800 (or income from taxable item x 20%)

    Tax payable = taxable income x 20% x (1 – 30%)

  • Income from royalties and property leasingSuch income is taxable on each payment. For remuneration received in each payment of less than Rmb4,000, a deduction of Rmb800 is allowed for expenses. For each payment of Rmb4,000 or more, a deduction of 20% is allowed for expenses. The remaining amount will be taxed at 20%.

    Taxable income = income from taxable item – Rmb800 (or income from taxable item x 20%)

    Tax payable = taxable income x 20%

  • Income from transfer of property

    Income from the transfer of property is taxed at a rate of 20%.

    Taxable income = income from transfer of property – original value of property – reasonable expenses

    Tax payable = taxable income x 20%

  • Income from interest, dividends and bonuses, contingent income and other income

    The applicable tax rate is 20%.

    Tax payable = income from each payment x 20%

  • Income from interest on savings deposits

    Income from interest accrued before 31 October 1999 is not subject to individual income tax; income from interest on savings deposits accrued from 1 November 1999 to 14 August 2007 is taxed at the proportional rate of 20%; income from interest on savings deposits accrued after 15 August 2007 is taxed at the proportional rate of 5%.

  • For individuals of foreign nationality and individuals who are residents of Hong Kong, Macau or Taiwan receiving income from interest on savings deposits within the territory of China, where the tax rate stipulated in the tax agreement signed between their resident country (or region) and the Chinese mainland (including the tax arrangements signed between the Mainland and the Hong Kong Special Administrative Region and the Macau Special Administrative Region respectively) is lower than that stipulated in China’s laws and regulations, they may enjoy the benefits of the agreement, provided that they submit application for the enjoyment of such tax agreement benefits. Where the tax rate in the agreement is higher than that stipulated in China’s laws and regulations, they may be taxed at the rate stipulated in China’s laws and regulations.

(c)  Filing of Tax Returns

Tax returns may be filed by taxpayers themselves or by withholding agents.

Land Appreciation Tax

Land appreciation tax is levied on units and individuals on incomes derived from the transfer of state-owned land-use rights, buildings and their attached facilities (hereinafter referred to as transfer of real estate), and are assessed at a prescribed tax rate on the basis of the appreciation amount derived by the taxpayer from the transfer of real estate.

(a)  Taxable Objects

The taxable objects of land appreciation tax are the appreciation amounts derived from the transfer of real estate. Taxpayers of land appreciation tax are units and individuals who transfer real estate and derive income from such transactions.

(b)  Tax Rates and Computation of Tax Payable

  • Appreciation amount

    The appreciation amount is the balance of proceeds received by the taxpayer on the transfer of real estate, after deducting the sum of deductible items.

  • Deductible items

    Deductible items for the transfer of state-owned land-use rights include amounts paid for the acquisition of land-use rights, costs and expenses for the development of land, taxes and fees related to the transfer of land-use rights, and other deductible items as stipulated by the Ministry of Finance.

    Deductible items for the transfer of new properties and buildings include amounts paid for the acquisition of land-use rights, costs and expenses for the construction of new buildings, taxes and fees related to the transfer of real estate, and other deductible items as stipulated by the Ministry of Finance.

    Deductible items for the transfer of used properties and buildings include the assessed value of the properties and buildings, the land price paid for the acquisition of land-use rights, expenses as stipulated by the state, taxes and fees payable during the transfer stage, and other deductible items as stipulated by the Ministry of Finance.

  • Tax rates

    Land appreciation tax is levied at progressive rates at four levels:

Table: Tax rates
Table: Tax rates

(c)  Filing of Tax Returns

Taxpayers should file their tax returns together with the necessary documents to the tax authorities at the place where the real estate is located within seven days of the signing of the real estate transfer agreement. The necessary documents include the real estate title deed and land-use right certificate, land transfer or real estate sale and purchase agreement, real estate evaluation report and other relevant documents.

 

 


[1]  According to Article 5 of the Administrative Measures for the Qualification Recognition of General VAT Taxpayers, the following VAT taxpayers are not subject to qualification recognition of general VAT taxpayers: (1) Individuals other than privately- or individually-owned businesses; (2) non-enterprise entities that choose to pay tax as small-scale VAT taxpayers; and (3) enterprises that do not frequently conduct taxable activities and that choose to pay tax as small-scale VAT taxpayers.

 

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