Does free transfer require payment of taxes?
Free transfer of state-owned assets is not subject to value-added tax.
Policy basis:
According to the "Interim Regulations of the People's Republic of China on Value-Added Tax" and its implementation rules, the scope of value-added tax collection is the sale of goods or the provision of processing, repair and repair services, and the transfer of imported goods.
The entire property rights of an enterprise are the overall transfer of the enterprise's assets, claims, debts and labor force. Therefore, the transfer of taxable goods involved in the transfer of all the enterprise's property rights does not fall within the scope of VAT, and no VAT is levied.
According to the provisions of the "Enterprise Income Tax Law of the People's Republic of China" (Order of the President of the People's Republic of China No. 63) and its implementation regulations, enterprises obtain income from various sources in monetary and non-monetary forms. Income is the total income. It includes:
(1) Income from the sale of goods;
(2) Income from the provision of labor services;
(3) Income from the transfer of property;
(4) Dividends, dividends and other equity investment income;
(5) Interest income;
(6) Rental income;
(7) Royalty income;
(8) Income from donations;
(9) Other income.
Income obtained by taxpayers If the above-mentioned regulations on income from donations are met, it is income from donations and should be included in the total income to declare corporate income tax in accordance with the above-mentioned regulations.
Accounting treatment for free transfer of corporate equity
1. Adopt the treatment method of "equity" adjustment.
In the practical operation process, the transfer of equity by the enterprise (the transferring party) for free is regarded as the shareholders recovering part of their investment in the company.
p>Debit: paid-in capital;
Credit: long-term equity investment.
The free transfer of equity by the enterprise (the transferring party) is deemed to be an increase in the shareholder's investment in the company. ,
Debit: long-term equity investment;
Credit: paid-in capital.
The first accounting treatment method is to equate the free transfer of equity to the opposite transfer At the same time, the transferee will treat the acquired equity as the increased investment of shareholders. The author believes that this treatment is actually at the expense of the capital reduction and capital increase of both parties to the transaction. Since it is a free transfer, the transfer is The party acquiring the equity does not need to pay monetary funds, non-monetary assets, or stock rights as consideration. Its essence should be a "donation" of the equity of the transferred party. Therefore, the result of this accounting treatment is not "gratuitous" and is regarded as a benefit. The transferred party also paid a price (using the equity and shares of the company as payment consideration).
2. Adopt the "profit and loss" adjustment method.
Some companies The transfer of equity without compensation should be regarded as a donation to the transfer party. The transfer party should include it as a loss in non-operating expenses. For the transfer party, the equity received for free should be regarded as the acquisition of the enterprise. A gain is included in non-operating income as a non-operating profit or loss. In the second accounting treatment method, the transfer and transfer are included in the profit and loss as a donation, but the author believes that when dealing with this kind of "donation" The difference between donations within the group and outside the group should be considered. If the free transfer is within the group, it is easy for major shareholders to transfer benefits to subsidiaries and related enterprises through related party relationships, thereby artificially manipulating profits and distorting the interests of related enterprises. financial status and operating results, thereby affecting the reliability of accounting information, which does not meet the prudence requirements of accounting information quality.
Does free transfer require payment of taxes? If it is a state-owned asset, it will be transferred free of charge. There is no need to pay value-added tax. At the same time, the editor also explained to you the financial treatment methods for free transfer of corporate equity such as equity adjustment and profit and loss adjustment. This is the end of the relevant content above. If you find it helpful, please continue to support our small company. Editor.