Regulations of the Ministry of Finance on the Accounting Treatment of Value-Added Tax
Regulations of the Ministry of Finance on the Accounting Treatment of Value-Added Tax
Ministry of Finance Regulations on the Accounting Treatment of Value-Added Tax
Cai Kuai Zi [1993] No.83
December 30, 1993
The competent departments under the State Council, departments (bureaus) of finance of all provinces, autonomous regions, municipalities directly under the Central Government, cities specially designated in the state plan and offices,
With a view to strengthening the accounting practice in companies,guaranteeing and promoting the financial and taxation reform, pursuant to the Interim Regulations of the People's Republic of China on Value-Added Tax (Order of the State Council [1993] No. 134), Interim Regulations of the People's Republic of China on Consumption Tax (Order of the State Council [1993] No. 135), Interim Regulations of the People's Republic of China on Business Tax (Order of the State Council [1993] No. 136) and other relevant provisions, we formulate associated provisions on accounting practice and issue hereby as an appendix. Please transmit the provisions to the companies concerned for their implementation as of January 1, 1994. In case of any problem, please report to us on a timely base.
Appendix:
Ministry of Finance Regulations on the Accounting Treatment of Value-Added Tax
The Interim Regulations of the People's Republic of China on Value-added Tax have been released by the State Council. The provisions on the accounting treatment of value-added tax are set out below:
I. Account Titles
1. Under the account titled "Taxes payable," enterprises shall open a subsidiary "VAT payable" account. Under the "VAT payable " subsidiary account, special columns, such as "Input tax" ,"Taxes paid", "Output tax" , "Tax refunds on exports", "Input tax transfers out", etc., shall be set up.
The special column "Input tax" records VAT that has been paid by an enterprise in purchasing goods or receiving taxable services and that can be credited against output tax. Input tax paid by an enterprise in purchasing goods or receiving taxable services shall be recorded in blue characters, while input tax to be offset as a result of returns of purchased goods shall be recorded in red characters.
The special column "Taxes paid" records the amount of VAT already paid by an enterprise. VAT already paid by the enterprise shall be recorded in blue characters, while VAT overpayment refunds shall be recorded in red characters.
The special column "Output tax" records VAT to be collected by an enterprise for goods sold or taxable services provided. VAT to be collected by the enterprise for goods sold or taxable services provided shall be recorded in blue characters, while output tax to be offset as a result of returns of sold goods shall be recorded in red characters.
......
Cai Kuai Zi [1993] No.83
December 30, 1993
The competent departments under the State Council, departments (bureaus) of finance of all provinces, autonomous regions, municipalities directly under the Central Government, cities specially designated in the state plan and offices,
With a view to strengthening the accounting practice in companies,guaranteeing and promoting the financial and taxation reform, pursuant to the Interim Regulations of the People's Republic of China on Value-Added Tax (Order of the State Council [1993] No. 134), Interim Regulations of the People's Republic of China on Consumption Tax (Order of the State Council [1993] No. 135), Interim Regulations of the People's Republic of China on Business Tax (Order of the State Council [1993] No. 136) and other relevant provisions, we formulate associated provisions on accounting practice and issue hereby as an appendix. Please transmit the provisions to the companies concerned for their implementation as of January 1, 1994. In case of any problem, please report to us on a timely base.
Appendix:
Ministry of Finance Regulations on the Accounting Treatment of Value-Added Tax
The Interim Regulations of the People's Republic of China on Value-added Tax have been released by the State Council. The provisions on the accounting treatment of value-added tax are set out below:
I. Account Titles
1. Under the account titled "Taxes payable," enterprises shall open a subsidiary "VAT payable" account. Under the "VAT payable " subsidiary account, special columns, such as "Input tax" ,"Taxes paid", "Output tax" , "Tax refunds on exports", "Input tax transfers out", etc., shall be set up.
The special column "Input tax" records VAT that has been paid by an enterprise in purchasing goods or receiving taxable services and that can be credited against output tax. Input tax paid by an enterprise in purchasing goods or receiving taxable services shall be recorded in blue characters, while input tax to be offset as a result of returns of purchased goods shall be recorded in red characters.
The special column "Taxes paid" records the amount of VAT already paid by an enterprise. VAT already paid by the enterprise shall be recorded in blue characters, while VAT overpayment refunds shall be recorded in red characters.
The special column "Output tax" records VAT to be collected by an enterprise for goods sold or taxable services provided. VAT to be collected by the enterprise for goods sold or taxable services provided shall be recorded in blue characters, while output tax to be offset as a result of returns of sold goods shall be recorded in red characters.
......