According to the Notice of the Ministry of Finance of People's Republic of China (PRC), State Taxation Administration of The People's Republic of China, on Several Policy Issues concerning Business Tax (Caishuizi [2003] 16), when both parties sign a contract and lease (agreement, the same below), the contracting fee and lease fee (lease fee, the same below) collected by the contractor and lessee for outsourcing or leasing some assets of the enterprise shall be taxed on the service industry.

In the case of affiliated business, if the affiliated party conducts foreign business in the name of the affiliated party, and the employer bears relevant legal responsibilities, the affiliated party is the taxpayer. The affiliated fees charged by affiliated parties to affiliated parties shall be subject to tax rate and value-added tax according to the nature of affiliated business. If the related party is a taxpayer, the affiliated fee charged by the related party shall be subject to VAT according to the business auxiliary service-enterprise management service.

Extended data:

Precautions:

Regarding the taxation of management fees charged by Jian 'an enterprises (affiliated units, hereinafter referred to as affiliated parties) to construction teams (hereinafter referred to as affiliated parties), construction and installation teams often take Jian 'an enterprises with corresponding qualifications to undertake Jian 'an projects in the name of affiliated parties, and the affiliated parties are responsible for project settlement.

When the project funds are allocated to related parties, the related party management fees will be collected by withholding or other means, and the related party will be responsible for the specific construction. At the same time, the received project funds will pay the business tax of Jian 'an Project in the name of the related party.

In view of the fact that the management fees charged by related parties from related parties and the project settlement price income obtained from providing construction services are two different taxable incomes of business tax, the settlement price of Jian 'an project should be taxed in full at the rate of 3% according to the "construction tax items"; The management fee paid by the related party to the related party belongs to the services provided by the related party for the related party to sign the project contract and handle the project settlement procedures.

Therefore, for Jian 'an enterprises (related parties) to collect management fees from construction teams (related parties), business tax should be levied at the tax rate of 5% according to the service industry-other service industries.

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