Recently, the Inspection Bureau of Yichang City, State Taxation Administration of The People's Republic of China investigated and dealt with a case in which an enterprise failed to withhold and pay personal income tax according to law. The enterprises involved in the case tried to evade the obligation of withholding personal income tax by manipulating the accounts and providing false supplementary agreements. The inspectors kept a close eye on the loan project of the enterprise, combined with multi-party verification, and finally locked in the illegal fact that the enterprise did not withhold and pay taxes, and made a decision to pay back the tax of 3,925,600 yuan and impose a fine of1962,800 yuan.

Suspicious fund exchange voucher

Not long ago, the Inspection Bureau of Yichang Municipal Taxation Bureau carried out tax-related inspection of municipal key tax sources in accordance with the work requirements of "double randomness and one openness", and Yichang H Real Estate Co., Ltd. was listed as the inspection object.

Inspectors learned that H Company was established in 20 10/February with a registered capital of 50 million yuan. It is a limited liability company and a general taxpayer. From 20 15 to 2017, the average annual pre-sale income of enterprises was 72.76 million yuan, and the average annual tax payment in three years exceeded15 million yuan. Mainly engaged in commercial residential real estate development and management business.

Before the investigation, the inspectors inquired about the tax-related information and financial information of H company in recent years through the collection and management information system. It is found that the enterprise has acquired land 10.78 million square meters in recent three years, and mainly developed the "central block" real estate project. Because it is an old city reconstruction project, the construction progress is slow. The inspectors learned that the "Central Block" project of H Company had only sold half of the saleable property by the time of inspection by the inspectors, and the project had not been completely completed. According to the large amount of land acquisition and demolition compensation in the early stage of the enterprise, the inspectors decided to focus on the pre-sale income accounting of the enterprise, as well as the payment of land use tax and deed tax involved in land acquisition and demolition compensation.

In addition, the inspectors found that the balance sheet information of enterprises during the inspection period showed that the amount of "other payables" increased year by year, with an increase of nearly 30% in three years. Under normal circumstances, as the projects are completed one after another and enter the pre-sale stage, other payables of the enterprise should gradually decrease, but the enterprise does not decrease, and the inspectors feel that it is different from the normal state and should further check.

After the inspectors entered the house, they retrieved the electronic accounts of H Company from 20 15 to 2017, and asked the enterprise to provide relevant accounting vouchers, as well as supporting materials and documents such as the establishment and commencement of the "Central Block" project.

The inspectors carefully checked the enterprise accounts and tax information. It is found that the land use tax and deed tax involved in the compensation for land acquisition and demolition of enterprises have been paid on time; The pre-sale income recorded in "accounts received in advance" has also been paid land value-added tax and enterprise income tax as required.

When checking the "other accounts payable" subjects of the enterprise, the inspectors found that the funds in and out of Company H were frequent during the inspection period, and the amount was large. For the situation that the amount of "other payables" has been increasing year after year, the enterprise staff said that because the project is too big, while the real estate construction is going on, the land acquisition and other work in the later period is still going on, so the enterprise is still financing.

In the process, a voucher in February of 20 15 caught the attention of inspectors, and it was recorded on the voucher that H Company received the current payment of Luo Mou15 million yuan. Later, the inspectors found that there were six similar vouchers for Luo in May of 20 15, with a single maximum amount of 58 million yuan, totaling 64.2 million yuan, which attracted the attention of the inspectors.

In this regard, Zhang, the person in charge of corporate finance, said that H Company developed the "Central Block" project and acquired land for years, but the bank loan could not be put in place. Luo and the company's chairman are husband and wife and have strong financing ability. Therefore, when the company needs capital turnover, it often provides loans to enterprises. These current accounts are Luo's business of borrowing from enterprises. The inspector immediately asked to see the loan contract. Zhang said it was a temporary loan, and the borrower had a special relationship with the company. Whether to sign a written contract at that time needed to be checked by the archivist, but the relevant personnel were on maternity leave and could not provide detailed information for the time being.

The inspectors then reviewed the current subjects again and found that not only Luo, but also Deng, Jiang and Liu had similar funds in the current account business. The enterprise staff said that the business of these six people in the current account project also borrowed money for the enterprise. According to statistics, these seven people involved in the loan amount of * * *10.96 billion yuan.

Inspectors believe that the actual situation of these businesses needs further verification, so they issued a notice of tax matters to H company, requiring enterprises to provide relevant business loan contracts and other information. A few days later, Zhang provided some loan contracts, saying that it took a lot of trouble to find these contracts, and the rest may have been lost before the company moved.

The inspectors checked these loan contracts signed by H Company and Deng Mou and others, and found that these contracts all stated: "The loan is only used for the development of the' Central Block' project; The loan term is 1 year, and the loan interest is 10% per annum, with monthly interest and annual interest payment; If it is not returned after the expiration, it will be automatically postponed, and the interest after the extension will be calculated according to the facts. "

Inspectors will then check the current accounts and contract details of H Company and the above seven people one by one. Upon verification, in the loan business of Company H from seven people, there was no contract corresponding to10.73 billion yuan, and the accumulated amount of funds returned by the enterprise in three years exceeded the loan by nearly 20 million yuan. Among them, Luo charged15 million yuan, and the other six people charged more than 4 million yuan. According to the information and evidence available, the inspectors judged that the extra money should be the loan interest paid by the enterprise to the individual. However, when asking Zhang about the situation, Zhang said that it was too long to remember clearly and needed to check before replying.

"no interest" loan business

The inspectors checked the tax payment of nearly 20 million yuan paid by the enterprise to the borrower during the inspection year, and found that the enterprise did not withhold and remit personal income tax on these expenses.

The inspectors immediately informed the staff of the enterprise that if the enterprise cannot explain the nature of the overpayment to the borrower, then according to the business practices and relevant laws and regulations, the enterprise should withhold and pay personal income tax on these expenses according to law. Shortly after receiving the notice, Zhang found the inspector and said that the company was really prepared to pay interest at the beginning of the loan, and there were also interest payment clauses in the loan contract. The company accrued interest on schedule and paid interest in the current account. However, during the development and construction of the project, the real estate market was depressed, the selling price and transaction volume declined, and the company also undertook the old city reconstruction project, which was difficult to remove and took a long time, resulting in the development project being blocked and the operation being difficult. Therefore, after consultation with the borrower, both parties unanimously agreed not to pay interest, but only to repay the borrower's principal, and the interest paid in the previous year will be used as the principal repayment later. These loans did not pay interest, so the enterprise did not withhold and pay taxes. Later, Zhang also took out the minutes of the board meeting of the enterprise on 20 18 1 month 15, which recorded the above information.

In this regard, the inspectors believe that the loan contract and accounting information provided by the enterprise show that the enterprise has paid interest instead of repaying the principal. It is impossible to confirm the truth of Zhang's claim only by a meeting minutes.

In this regard, Zhang explained that the enterprise and the borrower later signed a supplementary agreement on not paying interest, and the financial department had adjusted the accounts and corrected the current account information in February 20 18, but the inspectors read the annual account books from 20 15 to 2017, so they didn't see 20/kloc-0. Zhang immediately showed the inspectors seven copies of the Supplementary Agreement and related reconciliation vouchers.

Non-"related" investigation opens a breakthrough

In order to verify whether the information provided by the enterprise is true or not, the inspectors decided to check the third-party borrowers to confirm the authenticity of the information provided by the enterprise and look for clues and breakthroughs. After carefully analyzing the identities of the seven borrowers, the inspectors found that six of the seven borrowers were related to H Company, either shareholders and executives or family members of board members. Of the 7 people, only Liu has no relationship with H Company. According to the verification information, Liu had twice lent money to Company H, which was 2 million yuan and 200,000 yuan respectively, and Company H paid 2,748,500 yuan to Liu.

The inspectors immediately talked about Liu. At the beginning of the conversation, Liu told the inspectors that H Company's interest against principal and supplementary agreement were true. However, when the inspectors showed him the account information of H company and asked Liu about the overpayment of 548,500 yuan by H company, Liu could not answer at first.

Seeing this scene, the inspectors publicized Liu's tax law and told him that evading paying taxes and not cooperating with the tax authorities' investigation will not only affect credit and reputation, but also bear legal responsibility if the circumstances are serious. After the inspectors worked patiently, Liu finally told the truth.

Liu said that company H had not signed a supplementary agreement with these borrowers before, and there was no interest to offset the repayment of the principal. The supplementary agreement was only made temporarily recently.

After obtaining the real situation of the supplementary agreement from Liu, the inspectors decided to verify the authenticity of the account reconciliation on February 20 18 by electronic account verification. With the support of technicians, the inspectors checked the financial software of H company. Inspectors found that the operation log of enterprise financial software showed that the adjustment time of enterprise electronic accounts was * * * 36 reconciliations after the inspectors entered the household for inspection, instead of 20 18 February as claimed by Zhang, an enterprise accountant. The inspection results prove that the information provided by Zhang is not true.

The inspectors immediately expanded the scope of inspection and checked all the computers in the financial department of the enterprise according to law. In this process, it is found that there is an encrypted hidden file in the computer of the financial controller. After cracking, it is found that this file is all the records of H company's personal loan and interest payment.

After the evidence chain was complete, the inspectors interviewed the relevant person in charge of H company again. Faced with the evidence presented by the inspectors, the enterprise personnel could not justify themselves, and finally admitted the illegal fact that nearly 20 million yuan of loan interest was not withheld and remitted according to law. The tax authorities made a decision to pay back the personal income tax of 3,925,600 yuan and impose a fine of1962,800 yuan on Company H according to law.

Ming tax observation

According to the Individual Income Tax Law and its implementing regulations, individual income tax shall be paid at the rate of 20% for the interest, dividends and bonus income obtained by individuals owning creditor's rights and equity. For individual income tax, the income is the taxpayer and the unit or individual who pays the income is the withholding agent.

Article 69 of the Law on the Administration of Tax Collection stipulates that if the withholding agent fails to collect the tax, the tax authorities shall recover the tax from the taxpayer, and the withholding agent shall be fined more than 50% and less than three times the unpaid tax.

The Notice of State Taxation Administration of The People's Republic of China on Several Specific Issues Concerning the Implementation and Implementation Rules (Guo Shui Fa [2003] No.47) stipulates that if a withholding agent violates the provisions of the Tax Administration Law and its implementation rules, the tax authorities shall not only punish him according to the relevant provisions of the Tax Administration Law and its implementation rules, but also instruct the withholding agent to make up or collect the tax that should be withheld and receivable within a time limit.

Therefore, if the company fails to withhold and pay personal income tax on interest, the tax authorities will not only impose a fine of more than 50% but less than three times of the unpaid tax receivable on the company, but also instruct the company to make up or collect the unpaid tax within a time limit.

This case comes from China Tax News.