Q:
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Can the leasing service enjoy tax preferential policies during the epidemic?
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A:
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According to the “Announcement on Tax Policies for Supporting the Prevention and Control of Pneumonia Outbreaks of Novel Coronavirus Pneumonia Issued by State Administration of Taxation and the Ministry of Finance” (Caishui [2020] No. 8), the taxpayers who providing public transportation service, living service and necessary living materials delivery service are exempt from VAT. Since the leasing service is the modern service, it cannot enjoy this preferential policy.
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Q:
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The company leased out an office building and underground garage. During the epidemic period, the company signed a supplementary leasing agreement with the tenant to waive one-month rental fee and parking fee in order to support the prevention and control of the Novel Coronavirus. Does the rental fee and parking fee waived by company need to be treated as rental income for tax purpose?
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A:
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According to the “Announcement for the Issues of VAT Collection and Management on Land Price Deductions Issued by State Administration of Taxation” (No. 86, 2016), while taxpayers rent out real estate and the rental-free period is stipulated in the leasing agreement, the rental fee in rental-free period is not treated as rental income and exempt for VAT, as it not meet the criteria of deemed sales stipulated in article 14 of “Measures for the Pilot Implementation of Replacing Business Tax with Value Added Tax" (Cai Shui [2016] No. 36 Annex 1).
In addition, the “Notes on Sales Services, Intangible Assets, and Real Estate” (Caishui [2016] No. 36) stipulates that parking services are subject to value-added tax in accordance with real estate operating lease services. The company signed the supplementary lease agreement with a rental-free period, the rental fee and parking fee for 1-month rental-free period is not treated as rental income for tax purpose, so no VAT need to be paid.
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Q:
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During the epidemic period, the company rented out the housing properties and waived or reduced the rental fee for the tenant. According to the regulations, the rental fee after the reduction was used as the basis for property tax calculation. Does the reduced property tax need to be added for enterprise income tax calculation?
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A:
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While the companies rented housing properties and paid property tax according to regulations, the property tax paid can be deducted before enterprise income tax. If the property tax is decreased due to the reduction and exemption of rental fee, the actual property tax amount will be deducted before enterprise income tax.
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Q:
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Is there any property tax preferential policies for reduction of rental fee during the epidemic? How to calculate the property tax?
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A:
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According to the “Provisional Regulations on Property Tax” and related regulations, property tax is levied at a rate of 12% on rental income. For reduced rental fee, property tax is levied based on the amount of rental actually collected after the reduction.
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Q:
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During the epidemic period, the actual rental amount is different with the amount of the signed leasing agreement, which amount should be used to calculate and pay the stamp duty?
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A:
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According to the regulations of the “Provisional Regulations on Stamp Duty”, taxpayers shall calculate the stamp duty according to the amount contained in the contract.
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