Summary:

Financing sale and leaseback

(1) According to the “Regulations on the Relevant Matters Concerning the Pilot Reform of Value-Added Tax on Business Tax” (Cai Shui [2013] No. 106, Annex 2), the pilot taxpayer shall provide financing for sale and leaseback services, and the principal of the tangible movable property shall be collected from the lessee. A special invoice for VAT can be issued to issue a general invoice.

The general taxpayers in the pilot taxpayers provide financing after-sales leaseback services. The anti-counterfeiting tax control system shall be used to issue ordinary VAT invoices, and the pilot small-scale taxpayers shall issue ordinary invoices.

(2) In the financing of the sale and leaseback service, the principal of the tangible movable property price collected from the lessee shall be the legal valid certificate issued by the lessee.

1. VAT general taxpayers accept financing for sale and leaseback services, and should use the anti-counterfeiting tax control system to issue VAT ordinary invoices.

2. VAT small-scale taxpayers issue ordinary invoices.

3. Non-VAT taxpayers issue invoices as required.

(3) According to the Announcement of the State Administration of Taxation on the Tax Issues Concerning the Sale of Assets by the Lessee in the Financing Sale and Leaseback Business (State Administration of Taxation Announcement No. 13 of 2010), the lessee sells the assets in the financing sale and leaseback business The behavior is not subject to VAT and business tax collection, and no VAT is levied. Therefore, in the financing sale and leaseback service, the lessee is a VAT taxpayer, and the sales amount indicated on the VAT ordinary invoice (or ordinary invoice) issued by the provider is not declared as the taxpayer's sales.