Since the reform and opening up, a large number of processing enterprises have been established in coastal areas of my country. They have played an important role in attracting foreign investment, creating employment, and expanding exports. But on the other hand, since such enterprises do not yet have an independent accounting system, accountants often handle relevant financial and taxation matters based on their own understanding, and inaccurate corporate accounting and tax payments often occur. Here, we intend to give a brief introduction to the accounting and tax issues of such enterprises, hoping to provide some help for the correct accounting and tax treatment of processing enterprises.

1. Accounting treatment of supplied materials processing enterprises

The main raw materials, most auxiliary materials and production machinery and office equipment of supplied materials processing enterprises are generally provided by foreign investors Yes, there is no need to conduct accounting for this part of the assets, as long as the import and export quantities and balances are registered according to time as a reference account. In addition, processing enterprises with supplied materials do not have registered capital and do not need to calculate paid-in capital. Therefore, the accounting of processing companies is relatively simple, as long as the relevant expenses, labor payment income, current accounts, etc. are clarified.

(1) Accounting of income

First of all, according to the income recognition principles promulgated by the Ministry of Finance in 1998, enterprises processing supplied materials should recognize income after customs declaration for export. Because the main risks and rewards of commodity ownership have been transferred to foreign parties at this time, the processing enterprise no longer has the continued management rights related to the ownership of the commodity, and no longer controls the exported commodities. At the same time, the processing fee income related to the transaction It has been transferred to the enterprise and the relevant income and costs can be measured reliably.

Secondly, the income from internal and external processing business should be accounted for separately. At present, in order to adapt to the development of market economy, enterprises often adopt a variety of business methods, which may include import and export trade, production and processing business. This requires enterprises to distinguish the primary and secondary businesses. The main business is accounted for in "operating income", while the side-operated business is accounted for in "other business income". Contracted material processing enterprises also have similar problems. For example, in order to make full use of existing equipment, supplied material processing enterprises engage in both external processing business and domestic processing. In this case, they should account for internal and external processing business separately. External processing fee income is exempt from VAT, while internal processing fee income is subject to tax. If the division is unclear, you cannot enjoy tax exemption. In addition, an enterprise's income from selling scrap materials should be accounted for in "non-operating income" because it has no direct relationship with production and operations.

Third, the expenses paid by the overseas client should be truthfully included in the income. At present, the processing fee income of domestic processing enterprises is generally low. Overseas clients often sign certain agreements with domestic processing enterprises to pay part of the expenses (such as factory rent, customs declaration fees and other large expenditures). For example, a certain The total loss of the garment factory in 1997 and 1998 was as high as 8.99 million yuan, of which the processing fee income in 1998 was 720,000 yuan, and the total cost was 4.45 million yuan. The income only accounted for 16% of the expenses, and only wages were one item. The expenditure amounted to NT$3.12 million. The factory paid 3.12 million yuan in wages but only received 720,000 yuan in revenue. This factory has been in this situation for 10 years since its establishment, but it can continue to operate. The reason is that it turns out that overseas clients often pay cash (in RMB rather than foreign exchange) to the factory for daily expenses. This part of the cash is listed in the "other payables" account and is not reflected in the income account. This is a disguised form. The company's processing fee income is transferred, thereby transferring profits and reducing taxable income. At the same time, because the processing fee income is too low, it also reduces the country's foreign exchange income. Such expenses paid by foreign businessmen can be understood as out-of-price subsidy income and should be incorporated into taxable income to calculate and pay corporate income tax.

(2) Cost accounting

First of all, cost accounting should be detailed. Generally speaking, large processing companies can divide expenses into "manufacturing expenses" and "administrative expenses". Expenses used for production are included in "manufacturing expenses", and expenses used for office management are included in "administrative expenses". , and for small processing companies, all expenses can also be included in "administrative expenses". For export-related expenses, such as supervision fees, commodity inspection fees, health inspection fees, ordering fees, on-site inspection fees, entertainment fees, subsidies, etc., most companies include them in "customs declaration fees." In fact, this is not conducive to the company's financial analysis. The best way is to list it item by item. For example, some processing companies pay hundreds of thousands of yuan in customs declaration fees every month, but the specific expenses are not clear. If recorded separately, the above problem does not exist. At the same time, health inspection fees, on-site inspection fees, etc. are charged based on the number of trains. Supervision fees and commodity inspection fees are calculated based on the value of materials. If the actual expenditure amount deviates greatly, you can check whether there are abnormal expenditures, thereby promoting the company's Good financial analysis.

Secondly, the input tax on purchased raw materials and auxiliary materials cannot be deducted, but should be calculated separately and included in the cost. The main raw materials and most of the auxiliary materials for processing companies are imported through customs, and a small number of auxiliary materials are purchased domestically. For materials purchased domestically, even if a special VAT invoice is obtained, the input tax cannot be deducted but can only be included in the cost.

This is because, according to the current tax policy, goods processed with supplied materials and re-exported are subject to the "export tax exemption" management method, that is, the input tax (including input tax on imported materials and domestic materials) will not be deducted, and the final production and processing There are no taxes on links, and there are no tax refunds on exports. This is different from imported processing trade. Domestic materials used by imported processing enterprises can apply for export tax rebates (special value-added tax invoices must be obtained). Therefore, for export enterprises engaged in the re-export business of processing supplied materials, the input tax on taxed raw materials, auxiliary materials, etc. purchased for the production or processing of duty-free goods for re-export cannot be deducted and refunded, but should be accounted for and transferred separately. Included in operating costs for processing incoming materials. If the input tax of taxable and non-taxable items cannot be calculated separately, the input tax of raw materials consumed shall be allocated according to the sales ratio.

2. Tax preferences for processing enterprises with supplied materials

According to the "Measures for the Administration of Tax Refunds (Exemptions) for Export Goods", export enterprises can import duty-free under the "processing with supplied materials" trade method After purchasing raw materials and parts, they can apply for a "Processing Tax Exemption Certificate" from the tax authority in charge of export tax rebates with the customs declaration form for imported goods processed with supplied materials and the registration manual for processing with supplied materials approved by the customs. The tax authorities shall apply for exemption from value-added tax and consumption tax on the goods processed or entrusted to be processed and the labor fees paid thereto. After the goods are exported, the export enterprise should go through the verification procedures with the tax authority in charge of export tax refund with the export customs declaration form for processing with supplied materials, the registration manual for processing with supplied materials that has been verified by the customs, and the receipt of exchange. If the verification is not done within the time limit, the tax authority in charge of export The tax authorities responsible for the tax refund will work with the customs and the tax authorities in charge of tax collection to make up for the tax and impose penalties in a timely manner.

From the above regulations, we know that after the import of materials and parts, the export enterprise that undertakes the processing business with supplied materials can submit the export tax refund to the person in charge with the imported materials processing import declaration form and supplied materials processing registration manual approved by the customs. The tax authorities can apply for the "Tax-Free Certificate for Processing with Incoming Materials", and there is no need to wait for the verification of the manual for processing with incoming materials before applying for the "Exemption Certificate for Processing with Incoming Materials".

The materials that processing enterprises must submit when applying for tax exemption certificates include: processing trade business contract approval certificate, external processing and assembly contract, imported materials and parts application filing list, export finished product application filing list, and export finished products And the corresponding imported material consumption record list, basic contract information (including cover), copy of tax registration, tax exemption application report, and contract cancellation application form for the previous batch of goods.