(A) the value-added tax treatment in the merger of companies
1. VAT treatment of the real estate transferred by the merged enterprise to the merged enterprise.
Announcement of State Taxation Administration of The People's Republic of China City, People's Republic of China (PRC) on Value-added Tax Issues Related to Taxpayers' Asset Restructuring (People's Republic of China (PRC) State Taxation Administration of The People's Republic of China AnnouncementNo. 1 1) stipulates:? In the process of asset reorganization, taxpayers transfer all or part of physical assets and their related creditor's rights, liabilities and services to other units and individuals by means of merger, division, sale and replacement, which are not within the scope of VAT taxation, and the goods involved are not subject to VAT. ?
Based on this provision, we should pay attention to the following two points:
(1) The transfer of all or part of physical assets and their associated claims, liabilities and services to other units and individuals through merger, division, sale and replacement does not fall within the scope of VAT collection.
There are two key words in this regulation, which are? Physical assets? And then what? Together? . That is to say, in the process of merger, division, sale and replacement, the taxpayer of asset reorganization must transfer the physical assets and their associated creditor's rights, liabilities and labor? Together? Transfer to other units and individuals. In other words, it must be an asset reorganization that transfers all the property rights of the enterprise, that is, the transfer of taxable goods involved in the transfer of all the property rights of the enterprise is not within the scope of VAT taxation, and VAT is not levied. Otherwise, it is simply asset transfer or asset acquisition, and value-added tax should be levied regardless of the amount of assets transferred in a single transaction. So, in practice, absorption and merger? The transfer of taxable goods involved is not subject to VAT. Value-added tax is levied on asset acquisition or asset transfer or overall asset transfer.
For example, Company A holds the equity of Company B 100% .. 20 15 In May, Company A signed a merger agreement with Company C, stipulating that after Company A transferred all the property rights of Company B to Company C, Company B was cancelled. All the assets, creditor's rights, debts and labor of enterprise B are transferred to enterprise C, and the cancellation of enterprise B belongs to the act of absorption and merger. This behavior shall be subject to the Announcement of State Taxation Administration of The People's Republic of China City, People's Republic of China (PRC) on Value-added Tax Issues Concerning Taxpayer's Asset Restructuring (People's Republic of China (PRC) State Taxation Administration of The People's Republic of China AnnouncementNo. 1 1), and no value-added tax shall be levied.
If enterprise B transfers all its assets to enterprise C in exchange for equity and non-equity payment of enterprise C, and enterprise B does not cancel, it is the behavior of enterprise C to acquire the assets of enterprise B, which actually belongs to the overall asset transfer. In the asset transfer of enterprise B, if the ownership of taxable goods is transferred, the value-added tax shall be levied according to the regulations.
(2) Whether it is an asset restructuring transaction involving the transfer of all property rights or an asset restructuring transaction involving the transfer of part of property rights, the transfer of taxable goods involved does not fall within the scope of VAT collection. Transferring all the property rights of an enterprise is an act of transferring the assets, creditor's rights, debts and labor force of the enterprise as a whole; Transferring part of enterprise property rights is the act of transferring part of enterprise assets, creditor's rights, debts and labor force.
For example, Company A holds the equity of Company B 100% .. 20 15 In May, Company A signed a merger agreement with Company C, stipulating that after Company A transferred all the property rights of Company B to Company C, Company B was cancelled. However, it is stipulated in the merger agreement that some assets, creditor's rights and debts shall be borne by enterprise A, and all other assets, creditor's rights, debts and services shall be transferred to enterprise C. This behavior is a little complicated. According to the agreement, part of the assets, creditor's rights and debts of enterprise B shall be borne by enterprise A. In fact, if enterprise A obtains the assets of enterprise B and the ownership of taxable goods of enterprise B is transferred to enterprise A, value-added tax shall be levied according to regulations. Other assets, creditor's rights, debts and labor are transferred to enterprise C, partially absorbed by enterprise C and merged with enterprise B, and no value-added tax is levied.
2. Treatment of VAT deduction of merged enterprises
Article 1 of the Announcement of State Taxation Administration of The People's Republic of China City, People's Republic of China (PRC) on Relevant Issues Concerning Taxpayer's Asset Restructuring VAT Allowance (People's Republic of China (PRC) State Taxation Administration of The People's Republic of China Announcement No.2012 No.55) stipulates:? VAT general taxpayer (hereinafter referred to as? Original taxpayer? In the process of asset reorganization, all assets, liabilities and services are transferred to other general VAT taxpayers (hereinafter referred to as? New taxpayer? ), and the tax registration was cancelled according to the procedure. The input tax that was not deducted before the cancellation of registration can be carried forward to the new taxpayer for further deduction. . Based on this provision, only in the process of asset reorganization, the general VAT taxpayer must transfer all but not part of the assets, liabilities and services to other general VAT taxpayers (hereinafter referred to as? New taxpayer? ), and after the transfer, the tax registration must be cancelled according to the procedure before the retained VAT can be transferred to the new taxpayer for deduction. For enterprises that only transfer some assets, liabilities and services to other general VAT taxpayers, it is impossible to carry forward tax credits.
(B) Business tax treatment in company merger
Announcement of State Taxation Administration of The People's Republic of China, People's Republic of China (PRC) on Taxpayer's Business Tax Related to Asset Restructuring (People's Republic of China (PRC) State Taxation Administration of The People's Republic of China Announcement No.511) stipulates:? 20 1 1, 1,1In the process of asset reorganization, taxpayers transfer all or part of physical assets and their associated creditor's rights, debts and services to other units and individuals, which is not within the scope of business tax collection, including the transfer of real estate and land use rights. If it is not handled before, it shall be implemented in accordance with the provisions of this announcement. ? Based on this provision, in the taxpayer's reorganization methods such as merger, division, sale and replacement, if the transfer of real estate and land use rights involved is not subject to business tax, two conditions must be met at the same time: first, the enterprise will transfer all or part of the physical assets to other units and individuals; Second, the creditor's rights, debts and services related to the transfer of assets are also transferred to other units and individuals who accept all or part of the physical assets. If the enterprise only transfers all or part of the physical assets to other enterprises and individuals, but does not transfer the creditor's rights, debts and services related to the physical assets, the real estate and land use rights involved in the transfer must pay business tax.
(3) Treatment of land value-added tax
Article 3 of the Notice of the Ministry of Finance on Some Specific Issues Concerning Land Value-added Tax in State Taxation Administration of The People's Republic of China, People's Republic of China (PRC) (Caishuizi [1995] No.048) stipulates:? In enterprise merger, if the merged enterprise transfers the real estate to the merged enterprise, the land value-added tax will be temporarily exempted. ? Based on this provision, in the merger of companies, if the merged enterprise transfers real estate and land to the merged enterprise, the land value-added tax will be temporarily exempted.
(4) Handling of stamp duty
Article 2 of the Notice of the Ministry of Finance of People's Republic of China (PRC), State Taxation Administration of The People's Republic of China, on Stamp Duty Policy in the Process of Enterprise Restructuring (Caishui [2003] 183) stipulates:? For a new enterprise established in the form of merger or division, the funds recorded in the newly opened fund account book may not be declared for the previously declared part, and the undeclared part and the newly added funds may be declared according to regulations. ?
(five) the enterprise income tax treatment of enterprise merger.
1, general tax treatment of business combination
In business combination, the payment method of the merged enterprise can be a combination of equity payment and non-equity payment, or it can be a simple equity payment or non-equity payment. From the tax analysis, for the merging party, it is mainly a payment behavior, so it generally does not involve tax issues. If the merging party involves the payment of non-monetary assets, it generally needs to be treated as sales; For the merged party, after the cancellation of the enterprise merger, the assets of the enterprise are merged and transferred, and the shareholders of the enterprise get benefits. Therefore, the merged enterprise involves the tax issue of asset transfer.
According to the fourth item of Article 4 of Caishui [2009] No.59 document, in addition to the special tax treatment provisions stipulated in this notice, all parties to a business combination shall also follow the following provisions, namely, general tax treatment:
(1) The merged enterprise shall determine the tax basis to accept the assets and liabilities of the merged enterprise according to its fair value.
(2) The merged enterprise and its shareholders shall be subject to income tax treatment according to liquidation.
(3) The losses of the merged enterprise shall not be carried forward to make up in the merged enterprise.
[case]
When Company A merged with Company B, Company B's book net assets were 60 million yuan, and its fair value was 70 million yuan. After the shareholders of Company B receive the consolidated payment, Company A pays 50 million yuan for equity and 20 million yuan for other non-equity funds. At the same time, there is still a loss of 6,543,800 yuan in the account of Company B. Please analyze the relevant tax treatment of Company A and Company B. ..
[analysis]
In this merger, Company A accepted the net assets of Company B with a fair value of 70 million yuan as tax basis. Company B's assets increase by 6,543,800 yuan, and it is required to pay enterprise income tax according to regulations, which is regarded as after-tax liquidation distribution. Company B's RMB 6,543,800+can't be made up in the merged Company A. ..
2. Characteristics of business combination tax treatment
(1) Special tax treatment conditions for business combination
According to Article 5 of Caishui [2009] No.59 document, if the enterprise reorganization meets the following conditions at the same time, special tax treatment provisions shall apply:
1. has a reasonable commercial purpose, and its main purpose is not to reduce, exempt or delay tax payment.
2. The proportion of assets or equity of the acquired, merged or split part conforms to the proportion stipulated in this notice.
3. The original substantive business activities of the restructured assets will not be changed within 12 months after enterprise reorganization.
4. The amount of equity payment involved in the consideration of the restructuring transaction conforms to the proportion stipulated in this notice.
5. The original major shareholder who has obtained equity payment at the time of enterprise reorganization shall not transfer the acquired equity within 12 months after reorganization.
(2) Special tax treatment for business combination.
For business combination, the amount of equity payment obtained by shareholders during business combination is not less than 85% of the total transaction payment. For business combination without consideration under the same control, the following provisions can be selected:
1. For the equity payment in the transaction, you can choose not to confirm the transfer gains and losses of related assets.
2. The tax basis for the merged enterprise to accept the assets and liabilities of the merged enterprise shall be determined by the original tax basis of the merged enterprise.
3. The related income tax matters before the merger of the merged enterprise shall be inherited by the merged enterprise.
4. The loss limit of the merged enterprise that the merged enterprise can make up = the fair value of the net assets of the merged enterprise? The interest rate of the longest-term national debt issued by the state as of the end of the year when the M&A business occurs.
5. The tax basis of the shareholders of the merged enterprise who have obtained the equity of the merged enterprise shall be determined by the tax basis of the original equity of the merged enterprise.
(3) In terms of special tax treatment, non-equity payment should be taxed.
Item 6 of Article 6 of Caishui [2009] No.59 stipulates that if the parties to a restructuring transaction fail to confirm the gains or losses of relevant assets transfer temporarily according to the regulations, the non-equity payment shall still confirm the corresponding gains or losses of assets transfer in the current transaction period, and adjust the tax basis of the corresponding assets.
Gain or loss of assets transfer corresponding to non-equity payment = (fair value of transferred assets-tax basis of transferred assets)? (Non-equity payment amount? Fair value of transferred assets).
[case]
When Enterprise A and Enterprise B are merged, the book net assets of Enterprise B are 50 million yuan, and the assessed fair value is 60 million yuan. B the shareholders of the enterprise received the equity of the merged enterprise of 55 million yuan, and other non-equity payments of 5 million yuan. If the original equity investment cost of shareholder B of enterprise is 40 million yuan, please analyze the relevant tax treatment.
[analysis]
1, because equity payment accounts for 92% of the total transaction payment (5500? 6000? 100%), which exceeds 85%. Therefore, both parties can choose special tax treatment, that is, the asset appreciation part of 1000000 yuan is not subject to enterprise income tax. At the same time, the share exchange between Party A and Party B does not confirm the transfer gains and losses. Assuming that this ratio does not exceed 85%, the enterprise income tax with an asset appreciation of 6,543,800,000 yuan is 2,500,000 yuan, and the share-based payment also recognizes gains or losses.
2. Since the shareholders of Enterprise B have acquired the equity of the newly merged enterprise of 55 million yuan and the non-equity of 5 million yuan, the original equity investment cost of the shareholders of Enterprise B is 40 million yuan, and the added value is 20 million yuan (55 million +500-4000). The non-equity income of 5 million yuan obtained by shareholders corresponds to the transfer income of 5 million yuan. 6000? 2000= 166.7 (ten thousand yuan).
3. According to Item 4 of Article 6 of Caishui [2009] No.59? Tax basis: If the shareholders of the merged enterprise acquire the equity of the merged enterprise, it shall be determined based on the tax basis of the original equity of the merged enterprise? According to the regulations, the taxable cost for shareholders to obtain new shares is not 55 million yuan, but 36.667 million yuan (40-500+166.7).
4. According to Item 4 of Article 6 of Caishui [2009] No.59 document, in a business combination, the amount of equity payment obtained by shareholders during the business combination is not less than 85% of the total transaction payment, and if the business combination under the same control does not pay the consideration, the following provisions can be selected:
(1) The tax basis at which the merged enterprise accepts the assets and liabilities of the merged enterprise shall be determined by the original tax basis of the merged enterprise.
(2) Relevant income tax matters before the merger of the merged enterprise shall be inherited by the merged enterprise.
Therefore, in the above example, Enterprise A and Enterprise B are merged. Although the fair value of net assets of Enterprise B is 60 million yuan, its book value is 50 million yuan, and the merged enterprise can only use 50 million yuan as the tax basis for accepting assets.
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