Tax planning is also known as tax planning means in compliance with the tax regulations of the taxpayer to maximize enterprise value , or equity , in the range permitted by law, the tax agents or commission , through the financing , investment, income prior arrangements for the distribution , organization, management and other matters , the selection and planning to minimize the tax burden on economic activity purposes. Tax planning is the taxpayer through non- illegal tax avoidance schemes and legitimate tax saving methods and ways to achieve the tax burden shifted to minimize the tax burden behavior.
Tax planning and tax evasion, tax fraud , tax resistance is essentially the difference: tax evasion , tax fraud , tax resistance acts are in violation of tax law , and tax planning and tax consequences inherent and consistent with legal requirements , it will not affect the tax laws and weaken status does not affect a variety of functions and features and weaken taxes . Under the premise that it is not contrary to the tax policies and regulations conducted in the optimization of government tax laws enacted after comparison fine choice . Tax planning is a real sense of business continued to mature and rational signs, is a growingawareness of corporate tax performance , within the scope of the tax law , taxpayers are often faced with the choice of a variety of different tax tax programs taxpayers can evasive, choose low-tax tax scheme . Corporate tax planning is reasonable to minimize corporate tax burden in the extent permitted by law .
VAT is a British territory for the sale of goods or provision of processing, repairs and replacement services , as well as imported goods units and inpiduals to calculate their taxes on goods or taxable services sales made and the amount of imported goods , and the implementation of tax credits in a turnover tax deduction system. VAT is added in commodity production and circulation of the value added of all sectors or commodities taxed , so called " value-added tax ." VAT is the current turnover tax in the UK is an important tax, most industrial enterprises, commercial enterprises a leading tax. How to carry out the VAT tax planning is a problem we will be focusing on commercial and industrial enterprises . This article will refer to the variables introduced tax planning theory and factor analysis theory, combined with the VAT -related policies, seeking VAT tax planning space.
VAT taxpayer 's choice to start from , to find space for tax planning
VAT law will be the taxpayers of their scale of operation and sound accounting degree is pided into general taxpayers and small-scale taxpayers. General taxpayers selling or importing goods , provision of processing, repairs and replacement services , generally at the rate of 17% ; selling or importing goods part of a preferential tax rate , the tax rate is 13%. VAT levied on small-scale taxpayers is 3% . This tax policy , resulting in an objective difference in the two types of tax burden of taxpayers and tax benefits , tax planning for small-scale taxpayers and taxpayers in general possible. Through the study of the VAT tax , we can see the general taxpayers and small- scale taxpayers have their advantages. General taxpayer advantages: ( 1 ) the general taxpayer can deduct input VAT , while the small -scale taxpayers can not deduct input VAT ; ( 2 ) When the general taxpayers selling goods to each other can issue special VAT invoices, small-scale taxpayers can not ( although the tax authorities may apply on behalf of open , but the deductible rate is very low ) . Small-scale taxpayers advantages: input VAT ( 1 ) small- scale taxpayers can not deduct the cost of the product will be directly included in the final corporate income tax credit can play a role ; ( 2 ) small- scale taxpayers selling goods because they do not issue VAT invoices that do not have the burden of the sales price by the other 17% or 13 % VAT output tax , so the sales price is relatively low .
In the actual operating decisions, on the one hand enterprises in order to reduce the tax burden , to the general taxpayer to achieve the conversion from small -scale taxpayers , accounting costs will inevitably increase . Such as the creation of accounting books , culture or ability to hire accounting personnel. We must also consider the company selling goods in question using the VAT invoices . If the business rather than one-sided pursuit of reducing the tax burden for taxpayers in general , it is possible to produce because they can not issue VAT invoices and affect sales. Thus , the identity of the taxpayer 's tax planning choice , companies should be possible to reduce the tax burden does not affect the sale together with comprehensive consideration to get the maximum tax saving benefits.
VAT is calculated from the embedded elements start to find space for tax planning
According to " Provisional Regulations on VAT " provides general taxpayers selling goods or providing taxable services balance amounted current output tax deductible input tax after the current taxable . The formula is : Tax payable = Output tax - Input tax .
From the formula , the VAT tax planning to find space must be analyzed from the following two elements:
Output VAT
Output tax is the VAT VAT general taxpayers selling goods or taxable services , the rate of sales and provisions charged to the purchaser . The formula is : Output tax = Sales × tax rate. From here we can see that in certain circumstances the tax rate , depends on the size of the output VAT sales size. The larger sales , the greater the output tax , the income tax liability will be. According to " Provisional Regulations on VAT " requirement refers to all the sales price and other fees charged by the taxpayer selling goods or taxable services to the purchaser . Here , the expression " other charges " means the fee charged by the purchaser price extroverted , subsidies, funds , raising the return of profits, incentive fees , liquidated damages ( deferred payments ) , packaging, packaging rent, reserve costs, quality fees, transportation handling, collecting payments , advance payments and various other properties of the price charged . Tax law, these additional fees and charges , regardless of how the accounting provisions of the accounting system , should be incorporated into the tax sales. However, the following special cases may not be incorporated into the sales tax : ( 1 ) comply with the conditions Daidian shipping. Conditions here refers to : a. Freight transportation department 's invoice to the purchaser ; b. Taxpayers will be handed over to the purchaser 's invoice . ( 2 ) Water Company on behalf of the government collected sewage treatment fee . ( 3 ) newspapers and periodicals issued by the agency entrusted by the post office in the same one invoice can be paid minus the post office fee. ( 4 ) mobile phone shops selling mobile phones in the process, and calls on behalf of the access fee charged by the telecommunications sector savings . ( 5 ) the use of taxpayers selling gold and silver jewelry sold by trade , can subtract the price of old goods. ( 6 ) Additional charge of rural power grids in the process of charge . ( 7 ) packaging deposit received by the taxpayer , a separate bookkeeping accounting, current or past due less than a year , and so on . Starting from these special corporate policy , to reduce the tax burden reduced sales goals .
VAT
VAT tax law, for the average taxpayer , allowed deduction of input tax from output tax amount obtained from the sale is limited to the special VAT invoices and VAT indicated on the payment receipts from customs achieved . Through the study of the VAT tax law , the existence of input VAT spatial planning several special place : (1 ) the purchase of goods or materials , in part to obtain VAT invoices , another part can only get ordinary invoices, companies can through the establishment of branches, respectively, for general taxpayer status and identity of small-scale taxpayers , when such material procurement, get special ticket credited to the general taxpayer identity stores accounted for , obtain ordinary invoices credited to small-scale taxpayer stores accounted for . Through this classification management can reduce the overall tax burden of enterprises. ( 2 ) the general taxpayers to agricultural producers to purchase duty-free agricultural products , small- scale taxpayers , or to purchase agricultural products, granted in accordance with the 13% deduction rate of VAT is deducted from the amount of current output . But must provide proof. ( 3 ) the general taxpayer purchased goods ( other than fixed assets ) and transportation costs paid by the sale of goods , according to the documents listed in the shipping freight settlement amount ( ordinary invoices ) ( not including handling charges paid with shipping , insurance and other miscellaneous expenses ) , according to the 7% rate of VAT deduction . ( 4 ) Waste materials used materials operations engaged in value-added tax general taxpayer acquired VAT invoices can not be obtained , according to the amount of the tax authorities approved the acquisition on the acquisition of credentials specified for use , according to a 10% rate of VAT deduction be deducted. Enterprises should make full use of these special policies to expand VAT . But also to avoid the risk of tax .
Starting with VAT tax payer split , to find space for tax planning
When the acquisition or the acquisition of agricultural activities and other waste materials occur
For example, there is a steel mill , in order to increase the amount of input tax can be outside the iron and steel production enterprises, registered a waste recycling units , which go by the acquisition of scrap metal , and then sold to steel mills , steel mills will deduct 10% of the proceeds and more Tax . If the direct acquisition of scrap steel , there is no deductible proceeds . Another example is a dairy factory , the milk processing direct foreign sales , value-added tax will be high. If the plant breeding and dairy processing enterprises to separate into two independent accounting company, then the middle after an acquisition program . Such plants are grown produce farmed in the sale of milk, is tax-free . The dairy processing plant at the time of acquisition , it can reach 13% VAT , so the tax burden can be reduced.
Sales occur when mixed
Mixed sales tax on behavior , is based on " the main business operations " to determine taxation , select only one tax : VAT or sales tax . In the actual business activities, companies often run sales and mixed simultaneously , while tax planning, if companies choose to pay VAT , it is necessary to make taxable sales of goods accounted for more than 50% of total sales ; If the business choose to pay sales tax , it is necessary to make taxable services accounted for more than 50% of total sales. Although companies can by controlling the proportion of taxable goods and taxable services , to achieve selected as a low tax burden for taxpayers purposes. But in the actual business, some companies can not easily change the main business operations , which would be based on the actual situation of enterprises, by splitting the tax payer to tax planning . For example, there is a production of boiler business, while providing design, installation , commissioning and other services of the boiler, if the revenue production, installation, design , commissioning and other aggregated value added tax , the VAT tax will be high . If the company 's independent accounting under construction and installation company , specializing in the installation of the boiler , etc. , commissioning and design business , then the business is VAT tax will drop a lot . Another example is a production and sales coatings business , while providing paint painting and other services , the same approach can be split to reduce the VAT tax , which provides economic efficiency of enterprises .
VAT from the tax payer merge or associate to start to find space for tax planning
Merger
For small-scale taxpayers , if not high value-added product sales and mainly for the general taxpayer , judged as a general favorable corporate tax burden on taxpayers , but find it difficult to expand the scale of operations , you can contact a number of similar small- scale taxpayers people to implement the merger , scale it to become general taxpayers.
Associates
VAT general taxpayers and business taxpayers through joint ventures and it has become a business taxpayers , thus reducing the tax burden . For example, the telecommunications equipment business operations , a separate operation is subject to VAT , but if approved telecommunications administrations joint venture , then pay sales tax , do not pay VAT.
Starting from the VAT tax incentives , tax planning to find a space .
VAT is in addition to one of the largest corporate income tax incentives , if can make good use of these incentives, companies can greatly reduce the tax burden .
Current VAT incentives are the following types : ( 1 ) by industry offers classes for different industries to set up tax breaks or low tax policies, such as agriculture, industry, environmental protection and other tax incentives and more ; ( 2 ) by product category deals such as eco-friendly products, agricultural products , waste products, such as the use of tax incentives and more ; ( 3 ) by region offers classes such as special economic zones in the western region , such as tax incentives and more ; ( 4 ) the nature of the production deals by subject categories, such as school to do business , the disabled welfare enterprises , high-tech enterprises and other tax incentives and more . According to the type of preferential policies , enterprises in the establishment , investment and other business activities of enterprises must fully consider the investment area , the investment industry , product type and nature of the business to maximize the tax benefits , with full and adequate tax incentives.
In short, planning VAT , it should be carefully reading the "Regulations" and "Rules" , planning staff to be very precise understanding of the nature of business processes and the current initiatives of enterprises, on how the business should be very accurate tax analysis planning to develop a reasonable solution , we can not because of planning and state tax evasion , tax law should not be read because of lack of unnecessary cash outflow .