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China China Taxes Corporate Taxes Comparison Table of China Tax Issues to House Leasing
KNOWLEDGE|
Taxpayers |
Value Added Tax |
Surcharge Taxes |
Property Tax |
Stamp Duty |
Enterprise Income Tax/ Individual Income Tax |
Shenzhen Preferential Policies |
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Real Estate Development Enterprises (General Taxpayers) |
Rent out self-built house properties before April 30, 2016 |
Simplified Method: Tax Payable = Income (VAT inclusive)÷（1+5%）× 5% |
Tax basis is VAT amount, tax rates: Urban maintenance and construction tax:7% for Shenzhen Surcharge for education: 3% Surcharge for local education:2% |
Tax basis is the rental income (VAT exclusive). Tax payable = Rental Income (VAT exclusive) ×12% |
Companies renting out house properties shall pay stamp duty at 0.1% of the total rental amount in the lease contract concluded by both parties. The tax amount is CNY1 if the calculation tax amount is less than CNY1. |
Real estate development companies shall incorporate the rental income obtained by house leasing into the total income of the enterprise to calculate and pay enterprise income tax. The general tax rate is 25%. |
According to the relevant policies, small and low-profit enterprises can enjoy preferential tax rates from January 1, 2019 to December 31, 2021. Property tax is calculated and paid based on ad valorem. Tax Payable = Original value of taxable property×70%×1.2%÷12 ×months due |
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Rent out self-built house properties after May 1, 2016 |
General Method: Tax Payable = Income (VAT inclusive) ÷（1+9%）× 9% |
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General Taxpayers |
Rent out house properties which acquired before April 30, 2016 |
Simplified Method Tax Payable = Income (VAT inclusive) ÷（1+5%）× 5% |
Companies shall incorporate the rental income obtained by house leasing into the total income of the enterprise to calculate and pay enterprise income tax. The general tax rate is 25%. |
According to the relevant policies, small and low-profit enterprises can enjoy preferential tax rates from January 1, 2019 to December 31, 2021 Property tax is calculated and paid based on ad valorem. Tax Payable = Original value of taxable property×70%×1.2%÷12 ×months due |
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Rent out house properties which acquired after May 1, 2016 |
General Method： Tax Payable = Income (VAT inclusive) ÷（1+9%）×9% |
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Small-scale Taxpayers |
Units and individual industrial and commercial households rent out owned non-residential houses |
Tax Payable = Income (VAT inclusive) ÷（1+5%）×5% |
Companies shall incorporate the rental income obtained by house leasing into the total income of the enterprise to calculate and pay enterprise income tax. The general tax rate is 25%. |
2019.1.1 to 2021.12.31 VAT: monthly sales less than 100,000 (quarterly less than 300,000), exempted Surcharge tax：levied by half Property tax：calculated and paid based on ad valorem. And levied by half Stamp duty：levied by half |
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| Individual industrial and commercial households rent out owned residential houses |
Tax Payable = Income (VAT inclusive) ÷（1+5%）×1.5% |
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Individuals |
Rent out owned non-residential houses |
Tax Payable = Rental Income (VAT inclusive) ÷ (1+5%) ×5% |
Tax basis is the rental income (VAT exclusive). Tax payable = Rental Income (VAT exclusive) ×12% |
Monthly rental≤4000： Tax Payable=［Monthly Rental-Deductions-Maintenance Cost（limit to 800）-800］×20% Monthly rental＞4000： Tax Payable=［Monthly Rental-Deductions-Maintenance Cost（limit to 800）］×（1-20%）×20% |
Monthly rental≤100,000： VAT and surcharge tax：exempted Property tax：2% IIT：1% Stamp duty：levied by half Monthly rental＞100,000： VAT：5% Surcharge tax：levied by half IIT：1% Stamp duty：levied by half |
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Rent out owned residential houses |
Tax Payable = Income (VAT inclusive) ÷（1+5%）×1.5% |
Tax basis is the rental income (VAT inclusive). Tax payable = Rental Income Excluding VAT × 4% |
Exempted |
Monthly rental≤4000： Tax Payable=［Monthly Rental-Deductions-Maintenance Cost（limit to 800）-800］×10% Monthly rental＞4000： Tax Payable=［Monthly Rental-Deductions-Maintenance Cost（limit to 800）］×（1-20%）×10% |
Monthly rental≤100,000： VAT and surcharge tax：exempted Property tax：2% IIT：0.5% Monthly rental＞100,000： VAT：1.5% Surcharge tax：levied by half Property tax：2% IIT：0.5% |
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| Appendix： |
| EIT Preferential Policy for Small and Low-profit Enterprises |
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Conditions |
Preferential Policy |
Regulations |
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For the period during 1 January 2019 to 31 December 2021, the part of annual taxable income, which is less than RMB1,000,000 (including RMB1,000,000). |
25% exemption on the normal chargeable income, and enterprise income tax is charged at 20% |
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For the period during 1 January 2019 to 31 December 2021, the part of annual taxable income, which is more than RMB1,000,000 and less than RMB3,000,000 (including RMB3,000,000). |
50% exemption on the normal chargeable income, and enterprise income tax is charged at 20% |
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Disclaimer All information in this article is only for the purpose of information sharing, instead of professional suggestion. Kaizen will not assume any responsibility for loss or damage. |
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