How to avoid tax reasonably in equity transfer

How to reasonably avoid tax on equity transfer According to Article 6 (5) of the Individual Income Tax Law (revised in 2007) and Article 22 of the Regulations for the Implementation of the Individual Income Tax Law, the balance of equity transfer income after deducting the original value of property and reasonable expenses is taxable income, which actually refers to the profits made by individual shareholders due to equity transfer, or only in the case of premium transfer. If the equity transfer is fair or discounted, there is no problem of paying personal income tax. In addition, according to the fifth paragraph of Article 3 of the Individual Income Tax Law, the individual income tax rate of individuals who transfer shares is 20%. Therefore, in the case of equity premium transfer, the calculation formula of personal income tax is: (equity transfer income-investment cost-transfer expense) ×20%= personal income tax payable. The law also provides for special circumstances that do not require taxation. 1994, 1996, 1998, the Ministry of Finance of People's Republic of China (PRC) and State Taxation Administration of The People's Republic of China jointly issued the Notice on Temporary Exemption of Individual Income Tax from Stock Transfer, the Notice on Temporary Exemption of Individual Income Tax from Stock Transfer in 1996 and the Notice on Continued Temporary Exemption of Individual Income Tax from Stock Transfer. 1. Prevent double taxation: increase capital first and then transfer it to avoid double taxation. Second, increase transaction costs: increasing transaction costs is a common financial operation. Third, take the first listing as an example. Tax avoidance by means of share transfer: Notice on Temporary Exemption from Individual Income Tax on Share Transfer, Notice on Temporary Exemption from Individual Income Tax on Share Transfer 1996 and Notice on Temporary Exemption from Individual Income Tax on Share Transfer jointly issued by People's Republic of China (PRC) Ministry of Finance and State Taxation Administration of The People's Republic of China confirmed that listed companies will not pay individual income tax when transferring shares, which is a very good way for natural person shareholders of large enterprises, not only for financing, but also for financing. Fourth, you can't sign a yin-yang contract to avoid tax, and the legal risk is great. According to the second paragraph of Article 4 of the Notice on Strengthening the Management of Individual Income Tax on Equity Transfer (Guo [2009] No.285), "If the tax declaration basis is obviously low (such as parity, low-price transfer, etc.) without justifiable reasons, the competent tax authorities may refer to the net assets per share or the share of net assets corresponding to the rights and interests enjoyed by individual shareholders for verification". Signing a yin-yang contract to avoid tax is actually a kind of tax evasion, which may lead to civil litigation, administrative punishment, and serious criminal responsibility.