Branches are subordinate to the head office. Under normal circumstances, they declare and pay taxes on the spot as independent taxpayers according to the principle of territoriality, but those who meet the requirements can also pay in one lump sum after examination and confirmation. What's the difference between a branch company and a subsidiary company in dealing with taxes?
The difference between subsidiaries and branches in dealing with taxes is mainly reflected in the different legal status of the subject; Relations and differences in tax treatment, etc.
Differences in legal status of subjects
According to Article 14 of the Company Law of People's Republic of China (PRC) (Decree No.42 of the President of the People's Republic of China), a company may set up branches. The establishment of a branch company shall apply to the company registration authority for registration and obtain a business license. A branch company does not have legal person status, and its civil liability shall be borne by the company. ?
? A company may set up subsidiaries, which have legal personality and independently bear civil liabilities according to law. ?
Therefore, they are completely different in the legal status of the subject:
1. The subsidiary is an independent legal person in law, and bears civil liability independently according to law, that is, it conducts various civil economic activities in its own name; Independently bear all the consequences and responsibilities brought by the company's actions.
2. The branch company is not an independent legal person in law and does not have the qualification to bear civil liability independently. That is to say, the branch company is a branch of the head office in law, not an independent individual.
Differences in relationships
1, subsidiary:
The relationship between parent company and subsidiary company is generally the control and controlled relationship of shares, which may be wholly owned or controlled by the largest shareholder. Subsidiaries are dominated and controlled by the parent company in economy and decision-making, but in law, subsidiaries are independent legal persons.
The subsidiary has an independent name and articles of association; Having an independent organization; Have independent property.
The subsidiaries shall carry out independent accounting and be responsible for their own profits and losses.
2. Branch:
Generally speaking, the relationship between the head office and the branch office is the relationship between the head office and the branch office, which has the characteristics of subordinate relationship. In essence, a branch is an agency of the head office in different places.
Branches are generally not completely independent accounting units, and profits and losses are only a performance appraisal.
A subsidiary can set up a subsidiary, but it is impossible for a subsidiary to own a subsidiary.
Differences in tax treatment
(1) Handling of subsidiaries
As an independent legal person, subsidiaries conduct independent accounting and declare and pay taxes independently. They are completely independent taxpayers and bear all tax obligations.
(II) Handling of branches
As a branch, the branch is subject to the relevant policies of the Head Office.
The head office and branches shall handle tax registration according to law and accept the supervision and management of the local competent tax authorities.
1, enterprise income tax
(1) According to the Announcement of State Taxation Administration of The People's Republic of China, People's Republic of China (PRC) on Printing and Distributing the Measures for the Administration of Taxpayers' Income Tax Collection for Cross-regional Business Summary (People's Republic of China (PRC) State Taxation Administration of The People's Republic of China Announcement No.5712) (hereinafter referred to as? Announcement No.57 of the State Administration of Taxation 20 12? ) stipulates that if a resident enterprise establishes a branch without legal person status across regions in China (referring to provinces, autonomous regions, municipalities directly under the Central Government and cities under separate state planning, the same below), the resident enterprise is a cross-regional consolidated tax payment enterprise (hereinafter referred to as consolidated tax payment enterprise). Summarize the implementation of tax paying enterprises? Unified calculation, hierarchical management, on-site advance payment, summary liquidation, financial allocation? Measures for the administration of enterprise income tax collection.
Summarize the enterprise income tax calculated by taxpayers in accordance with the provisions of the Enterprise Income Tax Law, including the tax paid in advance and the tax refundable, and 50% shall be shared among branches, and each branch shall pay or refund the treasury on the spot according to the shared tax; 50% will be paid by the Head Office, of which 25% will be turned over or returned to the central treasury in full and 25% will be turned over or returned to the central treasury in full.
(2) The unincorporated branches that produce and operate in the name of the head office are unable to provide the consolidated income tax distribution table of the branches of tax paying enterprises, nor can they provide it? Announcement No.57 of the State Administration of Taxation 20 12? If the relevant evidence as stipulated in Article 23 proves the identity of its second-level and below branches, it shall be regarded as an independent taxpayer calculating and paying enterprise income tax locally.
(3) According to the Announcement of Zhejiang Provincial State Taxation Bureau and Zhejiang Provincial Local Taxation Bureau on the Administration of Income Tax Collection for Enterprises Operating Across Cities and Counties in Zhejiang Province (Announcement No.3 of Zhejiang Provincial Local Taxation Bureau No.2013), what are the management references for the calculation, prepayment and final settlement of enterprise income tax in Zhejiang Province? Announcement No.57 of the State Administration of Taxation 20 12? Execute.
Therefore, for the corporate income tax management of branches: should branches that meet the prescribed conditions apply? On-site prepayment and summary liquidation? ; If it is impossible to provide a summary income tax distribution table for the branches of the tax-paying enterprise, and it is also impossible to prove the branches, the enterprise income tax shall be paid locally according to the independent taxpayers; Branches carry out independent accounting, and if they do not pay taxes in a consolidated way, they shall pay enterprise income tax on the spot according to independent taxpayers.
The secondary branches of listed enterprises shall, in accordance with the relevant provisions of enterprise income tax, submit the enterprise income tax prepayment declaration form or other relevant materials to the local competent tax authorities, but their taxes shall be paid to the competent tax authorities where the head office is located after unified summary and calculation by the head office. For example, the listed companies in the Notice of People's Republic of China (PRC) State Taxation Administration of The People's Republic of China on the Administration of Enterprise Income Tax Collection of Industrial and Commercial Bank of China Co., Ltd. (Guoshuihan [2065 438+00] 184).
2. VAT
(1) The branch (which is a part of the branch, hereinafter referred to as the branch for the convenience of docking with documents) sells goods and provides processing, repair and repair services.
According to the provisions of Article 22 of the Provisional Regulations on Value-added Tax in People's Republic of China (PRC), fixed business households shall declare and pay taxes to the competent tax authorities where their institutions are located. If the head office and branches are not in the same county (city), they shall report and pay taxes to the competent tax authorities in their respective places. Therefore, the value-added tax of branches is generally declared and paid on the spot.
However, this article also stipulates that, with the approval of the financial and tax authorities of the State Council or its authorized financial and tax authorities, the head office may report and pay taxes to the competent tax authorities where the head office is located.
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 Relevant Policies for the Summary of Value-added Tax for General Branches of Fixed Business (Caishui [2012] No.9) further clarifies the above provisions: If the general branches of fixed business are not located in the same county (city) but in the same province (autonomous region, city), they shall report to the Finance Department (bureau) and the State Taxation Bureau of that province (autonomous region, city). Provinces (autonomous regions and municipalities) finance departments (bureaus) and State Taxation Bureau shall report the examination and approval results to the Ministry of Finance and State Taxation Administration of The People's Republic of China for the record.
In practical work, the value-added tax is collected and accounted by the head office, and it is mainly chain-operated enterprises that declare and pay in a unified way. For example, Article 3 of the Notice of Zhejiang State Taxation Bureau on the Collection and Payment of Value-added Tax for Chain Enterprises (Zhejiang Guoshuiliu [2005] No.76) stipulates? The head office of a chain-operated enterprise that has been approved to collect and pay value-added tax shall declare and pay tax to the local competent tax authorities according to the total amount of value-added tax payable in the month of unified accounting, that is, the value-added tax payable by the head office = all totals and store output tax-all totals and store input tax; The value-added tax payable by the store is zero. ? Therefore, the consolidated payment of VAT requires unified accounting by the head office and cannot be paid independently by the branch.
(2) Goods allocated between the head office and the branches with unified accounting shall be regarded as special provisions on sales.
First, collect relevant laws and regulations:
(1) Item (3) of Article 4 of the Detailed Rules for the Implementation of the Provisional Regulations on Value-added Tax is regarded as the act of selling goods: taxpayers with more than two institutions and unified accounting transfer goods from one institution to other institutions for sale, unless the relevant institutions are located in the same county (city).
(2) The Notice of State Taxation Administration of The People's Republic of China, People's Republic of China (PRC) on the Collection of Value-added Tax on Goods Transferred between Enterprises (Guo Shui Fa [1998] 137) stipulates that "used for sale" as mentioned in Item (3) of Article 4 of the Detailed Rules refers to the business behavior of the collection institution in any of the following circumstances: issuing invoices to the buyer; Collect money from the buyer. In either case, the consignee shall pay the value-added tax to the local tax authorities; If the above two situations do not occur, the value-added tax shall be paid uniformly by the head office. If the consignee only issues an invoice to the buyer or collects part of the payment, it shall calculate and pay taxes to the head office or branches respectively according to different situations.
(3) The Notice of State Taxation Administration of The People's Republic of China City, People's Republic of China (PRC) on the Taxpayer's Tax Location for Collecting Value-added Tax through the Fund Settlement Network (Guo [2002] No.802) stipulates that taxpayers open accounts in various places in the name of the head office, collect sales money from buyers in various places through the Fund Settlement Network, and the head office directly issues invoices to the buyers. If the collection agency fails to issue an invoice to the buyer or collect money from the buyer according to the Notice of State Taxation Administration of The People's Republic of China, People's Republic of China (PRC) on the Collection of Value-added Tax on Goods Transferred between Enterprises (Guo Shui Fa [1998] 137), its taxable income shall be subject to value-added tax at the place where its head office is located.
At first, the transfer of goods between institutions that carry out unified accounting for taxpayers was regarded as sales. The above three documents are difficult to understand, and I feel good. After thinking slowly, I understand a truth:
The head office transfers the goods to the branches between the taxpayer's head offices with unified accounting. If the branch uses the local invoice of the branch to issue an invoice to the buyer or collect payment from the buyer when selling the transferred goods, as long as one of these two conditions is met, it is necessary to pay the value-added tax on the sale of this part of the goods at the location of the branch. When goods are allocated, the head office needs to treat them as sales, and issue special invoices to the branches for deduction. However, if the head office collects money in a unified way and issues invoices, it shall pay VAT at the place where the head office is located.
(3) Provisions on the consolidated payment of value-added tax by the taxpayer's head office in the transformation of value-added tax (i.e. taxable services)
According to the Notice of People's Republic of China (PRC) and State Taxation Administration of The People's Republic of China of the Ministry of Finance on Re-printing the Interim Measures for the Calculation and Payment of VAT for Pilot Taxpayers in Head Offices (Cai Shui [2065438+03] No.74), pilot taxpayers in head offices and their branches approved by the Ministry of Finance of People's Republic of China (PRC) and State Taxation Administration of The People's Republic of China can declare and pay VAT according to this method.
When the head office and branches of VAT taxpayers report and pay VAT in summary, only taxable services are summarized. When the head office and branches sell goods and provide processing, repair and replacement services, they shall declare and pay value-added tax on the spot in accordance with the provisional regulations on value-added tax and relevant regulations.
The head office will summarize the value-added tax payable by the taxable services of the head office, deduct the value-added tax payable by the taxable services of all branches, and declare and pay the value-added tax at the location of the head office.
Taxable service business occurs in all branches, and VAT is calculated and paid according to the applicable VAT sales and withholding rate.
The calculation formula is as follows:
Prepaid VAT = VAT sales? Pretreatment rate
The prerequisitioned rate shall be stipulated by the Ministry of Finance of People's Republic of China (PRC) and State Taxation Administration of The People's Republic of China, and adjusted in time.
In short, subsidiaries are independent taxpayers and full taxpayers. Branches are subordinate to the head office. Under normal circumstances, they declare and pay VAT on the spot as independent taxpayers according to the principle of territoriality. However, if it is confirmed that it meets the requirements after examination, it can also be levied and paid, and the taxable service part of the camp reform needs to be paid in advance according to the pre-levy rate; In terms of income tax, as an independent taxpayer, independent accounting is used to declare and pay taxes on the spot, and unified accounting is implemented? Unified calculation, hierarchical management, on-site advance payment, summary liquidation, financial allocation? Measures for the administration of enterprise income tax collection.
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