Q:
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Which taxpayers are applicable to tax credit ratings?
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A:
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Tax credit ratings are applicable to independent accounting enterprises, sole proprietorships, and partnership enterprises that have undergone tax registration (including “Three in One” and “One Code for One License”, and temporary registration), engage in production or business operation, and pay taxes on an actual profit basis.
“Paying taxes on an actual profit basis” means that enterprise income tax is collected according to actual profits, which shall apply to sole proprietorships and partnership enterprises.
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Q:
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What is the evaluation cycle of tax credit rating?
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A:
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The evaluation cycle of tax credit rating is calendar year, i.e. from 1 January to 31 December.
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Q:
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What are the ratings of tax credit?
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A:
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There are four tax credit levels: A, B, C and D. Where a taxpayer gets above 90 points in annual evaluation index, its tax credit rating shall be A; where a taxpayer gets above 70 and less than 90 points in annual evaluation index, its tax credit rating shall be B; where a taxpayer gets above 40 and less than 70 points in annual evaluation index, its tax credit rating shall be C; where a taxpayer gets less than 40 points in annual evaluation index, or is directly rated as D, its tax credit rating shall be D.
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Q:
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How will a taxpayer with no income within a evaluation year be rated of tax credit?
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A:
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Taxpayers with no business operating income within an evaluation year shall not be rated of tax credit for the corresponding year.
The business operating income refers to the income from main business activity, which does not include non-main business income, such as rental income, income from disposal of items, etc. It shall be determined by the declaration records of main business income in the tax administration during the evaluation year on whether the taxpayer has obtained main business income or not.
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Q:
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My company got 92 points in last evaluation year, why wasn’t my company rated as level A?
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A:
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Taxpayers under one of the following circumstances cannot be rated as A-level in this evaluation year.
1.
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Actual operating period is less than 3 years;
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2.
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The taxpayer was rated as level D in last tax credit rating evaluation year;
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3.
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The taxpayer has declared VAT or business tax as zero or negative for 3 consecutive months or for a cumulative 6 months within an evaluation year without valid reasons;
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4.
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The taxpayer failed to establish accounting books, account for based on legal and valid vouchers, or provide accurate tax related materials to tax authorities.
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If your company is not under any of above circumstances, please consult with the competent tax authority.
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Q:
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If a taxpayer has done something harmful to its tax credit rating, is there anything he can do to remedy?
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A:
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Enterprise taxpayers who are included in tax credit management and meet one of the following conditions may apply to the competent tax authority for tax credit restoration within the prescribed time limit.
1.
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The taxpayer failed to complete tax declaration, tax payment, document filing and other matters within the statutory deadline and the relevant formalities have been made up;
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2.
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The taxpayer failed to pay or to pay in full amount taxes, late fees or fines according to the handling conclusion of the tax authority, which does not constitute a crime, or are directly rated as Grade D in tax credit rating, and has paid taxes in full amount or paid tax arrears within 60 days after the expiry of the period clarified in the handling conclusion of the tax authority.
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3.
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The taxpayer has fulfilled corresponding legal obligations and its status as an abnormal taxpayer has been lifted by the tax authority according to law.
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Q:
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What if the taxpayer has objections to the tax credit rating?
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A:
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If a taxpayer has objections to the evaluation result, he can fill in the "Application Form for Tax Credit Reassessment (Verification)" in March of the following year of the evaluation year and submit a review application to the tax authority. The competent tax authority shall check and adjust its conclusion while implementing annual evaluation and provide query services on the review result to the taxpayer.
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