Processing with supplied materials refers to processing trade in which imported materials and parts are provided by foreign businessmen, that is, there is no need to pay foreign exchange for import, and there is no need to repay processing fees. The finished products are sold by foreign businessmen, and the operating enterprise charges processing fees.

Incoming material processing refers to the processing trade in which imported materials and parts are imported by operating enterprises and the finished products are exported by economic enterprises. There are the following differences between incoming material processing and imported material processing:

1. The processing of supplied materials is the materials provided by the other party, and we process them according to the designs, varieties and quantities specified by them, and we charge the other party the agreed processing fees; the processing of supplied materials is my own business, and I feed myself the materials and customize the varieties. The designs and colors are processed by oneself, and one is responsible for the profit and loss.

2. In processing with imported materials, importing is one transaction, and processing and re-exporting is another transaction. There is no connection in the import and export contract; the import of raw materials and the export of finished products for processing with supplied materials are often one transaction. , or two related transactions, the supplier of raw materials is often the recipient of the finished product

3. The two parties involved in the processing of supplied materials are generally in a contract processing relationship, and part of the processing of supplied materials does include some of our raw materials. , there is a buying and selling relationship to varying degrees, but generally in order to ensure the timely export of products, we have an agreement with the other party to purchase these products, process them with imported materials, and then export them. In terms of trade objects, there is no necessary connection. In, out, out, the other party and I are in a commodity buying and selling relationship, not a processing relationship.

VAT on processing of supplied materials:

1. Export goods processed with supplied materials are exempt from VAT;

2. Labor payment income obtained by processing enterprises is exempted from VAT VAT.

3. The input tax paid on domestic goods used for exported goods shall not be deducted and transferred to the production cost, and the tax paid on the domestic supporting raw materials will not be refunded.

Value-added tax for imported processing: Imported materials and parts for imported processing business are generally exempt from VAT. When exporting, there is no refund for the input tax corresponding to the tax-free imported materials, so when calculating the exemption When applying for tax credits and refunds, it is necessary to calculate a credit amount in which the amount of tax exemptions, credits and refunds cannot be exempted and deducted.

Tariffs for processing of supplied materials: No tariffs are levied on imports, and export tariffs are not levied on finished products when exported.

Incoming material processing tariff: Import tariff is exempted based on the quantity re-exported after processing. This part of the material is exempt from export tariff when exported.