FAQQ&A Regarding Reversal of Input VAT Deduction
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What vouchers are for input VAT deduction? |
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A： |
Input VAT deduction vouchers refer to VAT special invoices, customs import VAT special payment vouchers, agricultural product purchase invoices, agricultural product sales invoices, and tax payment vouchers.
If the VAT deduction vouchers obtained by the taxpayer do not comply with laws, administrative regulations or relevant provisions of the State Administration of Taxation, the input tax shall not be deducted from the output tax. Taxpayers who deduct input tax with tax payment vouchers shall provide written contracts, payment vouchers, and overseas company’s statements or invoices. If the information is incomplete, the input tax shall not be deducted from the output tax. |
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Under what circumstances that input tax cannot be deducted from output tax? |
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A： |
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Q： |
How can general taxpayers with concurrent projects classify input tax that cannot be deducted? |
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A： |
Taxpayers who apply the general tax calculation method but engage in simple tax calculation projects or exempt VAT projects that cannot be split from non-deductible input tax shall calculate the non-deductible input tax according to the following formula: Non-deductible input tax = total input tax that cannot be split in the current period * (sales revenue of simple tax calculation projects + sales revenue of exempted VAT projects) / total sales revenue of the current period. |
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How to handle the situation where the input tax deduction for fixed assets and real estate is reversed? |
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Fixed assets and real estate for which input tax have already been deducted, if their usage changes and they are "exclusively used" for items for which input tax cannot be deducted, the input tax deduction will be reversed in the "current period" when the usage changes. For real estate for which input tax has already been deducted, if there is abnormal loss or a change in use, and it is specifically used for simple tax calculation projects, VAT exemption projects, collective welfare or personal consumption, the input tax that cannot be deducted shall be calculated according to the following formula and deducted from the current input tax: the input tax that cannot be deducted = the input tax that has been deducted * the real estate net value ratio, the real estate net value ratio = (real estate net value / real estate original value) * 100%. |
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How to handle the additional deduction amount when input VAT reversal occurs? |
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According to current regulations, input tax that cannot be deducted from output tax shall not be subject to additional deduction; If the input tax amount that has been provisioned for additional deduction, is reversed out as input tax according to regulations, the corresponding additional deduction amount should be adjusted in the current period of input tax reversal. Current deductible additional deduction amount = balance of last period's additional deduction amount + current period's provision of additional deduction amount - current period's adjustment of additional deduction amount. |
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