Business loan tax-no risk? It can't be!
stage finance in enterprises, mainly related to loans from financial institutions and non-financial institutions, including non-financial institutions loans can be divided into business and individual shareholder loans. Enterprises to civil usury finance, 3 kinds of financing methods such as borrowing between associated enterprises. Some enterprise due to on loan involved tax policy master not through, in business processing in the of involved tax risk occurred, how makes enterprise in loan process in the avoid risk, Super practical of tax planning, carefully reading, don't missed yo ~
enterprise to financial enterprise loan no risk
enterprise income tax method provides, enterprise in production, and business activities in the to financial enterprise of loan interest spending allows truly deduction. Not just financial companies without tax-related risk in the loan interest expenses, are available in the corporate income tax deduction. When the deductions for mortgage interest, you need to pay attention to the following issues: the
first, the enterprise after deducting interest expense should pay attention to when the loan is used for the production and business activities. If the loans are not used for production and business activities of the enterprise, it is independent of the income interest expenses interest expense, against the principle of correlation of pre-tax deduction, tax shall not be deducted.
Second, investors need to pay attention, try to reduce the risk of capital in place of registration or withdrawal of registered capital. If investors investment not in place, or exists flight registered capital phenomenon, according to on Enterprise investors investment not in place and occurred of interest spending enterprise income tax Qian deduction problem of reply (IRS letter (2009) No. 312, file of provides: where Enterprise investors in provides term within not paid foot its should paid capital amount of, the enterprise foreign loan by occurred of interest, equivalent to investors real paid capital amount and in provides term within paid capital amount of difference should meter pay of interest, its not belongs to enterprise reasonable of spending, Shall be borne by the investors shall not be deducted in calculating the corporate taxable.
third, the loan interest payments must be strictly distinguish between capital expenditure and revenue expenditure. Enterprises for the purchase and construction of fixed assets, intangible assets and construction after more than 12 months to achieve the intended sale of stock loans, assets acquisition, construction occurred during the reasonable costs should be treated as capital expenditure accounted for in the cost of the relevant assets, and complying with the provisions in the income tax deduction. Enterprises in production and business activities in the rational does not need to be capitalized loan costs are allowed as expenses for the period before tax deductions.
enterprise to non-financial enterprise loan
according to file on enterprise to natural loan of interest spending enterprise income tax tax Qian deduction problem of notification (IRS letter (2009) No. 777,) and on enterprise income tax several problem of announcement (national tax General (2011) 34th,) this two a file of provides, enterprise to non-financial enterprise loan paid of interest to wants to in enterprise income tax Qian deduction, need meet following 4 a conditions.
the first, signed loan contracts between companies and non-financial companies.
Second, the business of lending to non-financial enterprises in interest payments, does not exceed the amount calculated in accordance with financial companies similar rates over the same period part is allowed to deduct the excess, tax shall not be deducted. Enterprises in accordance with the contract required deductions before tax and interest payments for the first time, should be provided "financial institutions, interest rates on similar loans over the same period note" to prove the rationality of its interest expense.
to this, businesses need to pay attention to the following issues. First, the enterprise only to non-financial firms to pay interest for the first time, you need to provide "interest rates on similar loans over the same period in financial enterprises". Second, the scope of financial firms. Scoped in the context of this province, whether belonging to the tax provided for in the scope of financial firms, the key lies in whether its scope shown in the business license "loans". Third, the choice of financial firms. Finance companies, trust companies rates are generally higher than bank interest rates, so in submission to tax authority "financial institutions, interest rates on similar loans over the same period note", should as far as possible to finance companies, trust companies and other financial institutions, interest rates, as the basis and source of rate information. Finally, interest rates on similar loans over the same period, can be either financial firms announced similar average rates over the same period, can also be a real lending rates for some businesses in financial enterprises. In other words, "interest rates on similar loans over the same period" includes both the base rate and including a floating interest rate. Enterprise is concerned, if the corresponding information on the financial enterprises of similar loans with higher interest rates over the same period, you can raise the interest expense tax deduction limit.
third, when Enterprise foreign interest payments, you need to obtain a corresponding invoice. If you did not obtain the appropriate invoices and legal documents of the enterprise is not tax deductible, tax shall not be deducted.
Finally, when paying interest, taxes shall not be paid for the creditor in corporate income tax deductions. In practice, when companies when interest payments on loans to individuals, related interest and taxes are often borne by the enterprise. Since this part of the tax on the payment receipts indicate that the taxpayer is the creditor, and should not be charged to the expenses of the debtor, not in front of the corporate income tax deductions. At the time of signing the contract, enterprises can be considered in case of guarantee actual constant returns to creditors, creditors through increased interest rates, convert the after-tax interest rate before tax interest, so as to avoid tax risk.
unpaid loans between associated enterprises there are two risk
unpaid loans between associated enterprises following two major tax risks.
is the unpaid loans between associated enterprises in accordance with the financial and insurance industries to pay business tax, enterprise income tax risks. The business tax rules (Ministry of finance, the State administration of taxation 2008 of 52nd) article, mentioned in the first article of the Bill provide regulation services, transferring intangible assets or selling real estate, refers to the possible regulation of services, transfer of intangible assets or transfer of ownership of real estate.
due to unpaid loans no income reflected, and therefore no income tax implications. Taxpayers need is concerned, enterprises will lend idle funds to another enterprise, contract companies do not charge interest, but another firm at below-market prices to provide other services or product, cannot be considered free. As long as the companies do not charge interest on the loans is the case, the tax authorities will explore the possibility of other economic benefits of the channel. If the other companies at below-market prices, and even get free company services or product, the tax authorities according to the relations judge business loans are "paid" and, therefore, its tax revenues. If unpaid, the taxpayer has an obligation to prove their "free" loans grounds of legitimacy.
If loans between associated enterprises, loans are "Finance and insurance" tax collection scope and the means used by lenders and others. Either financial institutions or other units as long as lending behavior with others, shall be regarded as lending practices, according to "Finance and insurance" taxes levied.
according to the 36th article of the law on tax collection and management, business dealings between associated enterprises should be charged according to business transactions between independent enterprises or payment of the price, costs; no charge according to business transactions between independent enterprises or payment of the price, costs, and reducing their taxable income or income, the tax authority has the right to make reasonable adjustments.
is another risk, Corporate Bank loans lent to others without compensation and to pay the bank interest expenses may not be tax deductible. Corporate Bank loans lent to others without compensation, essentially began giving away benefits enterprise an act of donation of others, so Bank loans free transfer to another enterprise, the interest payments not related to corporate income should increase taxable income amount.
for the above tax-related risk of unpaid loans between associated enterprises, enterprises should take the following control strategies: access to capital transfer between associated enterprises use cannot be free use, free use in one fiscal year, generally do not have to pay tax and enterprise tax risk. In the case of annual loans should be paid, interest is charged to the local tax Department on behalf of open invoices. Meanwhile, according to the Ministry of State administration of taxation on corporate related parties interest expense tax deduction on tax policy issues notice of taxation (2008) 121th provides that loans must pay attention to the affiliated companies accept related party Debt investment with equity investment ratio is "2:1".
business and personal tax-related risk
shareholder loan business loan with individual shareholders of tax-related risks mainly in two ways: on the one hand, reimbursable loan company individual shareholder loans are required to pay sales tax; unpaid borrow money not returned at the end of the company's shareholders, will have to pay personal income tax 20%.
on the other hand, individual shareholders in their house or car to the Bank after the mortgage, loans to enterprises, Enterprise on behalf of shareholders to pay bank interest cannot be corporate income tax deduction, because payments are shareholders of the Bank loans, interest payments on the notes issued by the Bank is the shareholder of the name of the person, before tax accounted for in the costs are not recognized by the Inland Revenue Department.
for above tax risk, should take following control measures:
first, enterprise using personal shareholders of loan should paid interest, according to on enterprise to natural loan of interest spending enterprise income tax tax Qian deduction problem of notification IRS letter (2009) No. 777, file of provides, enterprise should and shareholders signed set loan contract, to shareholders loan of total in a fiscal year within not above shareholders in company within of registered capital of twice times, While going to the local taxation Bureau invoice books. Shareholder borrowed company money to pay interest (in a fiscal year may be free, or at the end of a fiscal year must be returned to the company to borrow money from company).
Second, investors or corporate funds cannot be used for consumption expenditure expenditures for property, or as a corporate dividend distribution to individual investors and to pay personal income tax 20%.
third, if the shareholder loan from the Bank, then lending to their use must be in the loan contract "uses of funds" column indicated in the enterprise, and negotiations with banks, bank loans directly into corporate accounts. However, based on the principle of substance over form, can be deducted pre-tax. Folk usurious loans
enterprise/> in practice, tax risks for enterprises to civil loan sharks are: civil usury finance to pay higher interest rates, interest free notes, before corporate income tax cannot be deducted if tax authorities found also 20% personal income tax withholding.
to avoid the risk of private financing for tax, to control from the following three aspects: first
enterprises and natural persons shall sign a loan contract, and between business and personal loans are real, legitimate and effective, does not have illegal fund raising purposes.
Second, pay attention to illegal fund-raising and the true meaning of real, legitimate, and effective. Has any of the following circumstances shall be determined to be invalid: corporate loan to the workers ' illegal fund-raising on behalf enterprises to borrow on behalf of illegal fund raising enterprise on behalf of the lending loans to public; other acts in violation of laws, administrative rules and regulations.
third, pay attention to "financial institutions, interest rates on similar loans over the same period note" connotation.
4 points must be clarified: is interest rates on similar loans over the same period including the base interest rate, plus a floating interest rate. Second bulletin 34th basically interest on loans extended to all "actual interest payments." Three are "financial institutions, interest rates on similar loans over the same period note" shall at the latest at the end of final settlement provided and reported to the tax authorities. Four interest rate reference standards including "trust companies, finance companies," financial institutions, known as trust company of interest rate is relatively high, so companies in this province-wide to find such a reference, is not difficult. This also means that as long as interest payments are not wide of the mark, can basically in accordance with the "actual interest payments" deducted.