1, when sales revenue is obtained. Debit: bank deposits/accounts receivable, etc. And loans: main business income/other business income.
2. When paying VAT. Debit: taxes payable-value-added tax payable, loan: bank deposit.
3. Speaking of tax exemption. Debit: tax payable-value-added tax payable, and loan: non-operating income.
4. When carrying forward the cost of sales. Debit: main business cost, loan: inventory goods/raw materials, etc.
Small-scale taxpayers have the following characteristics in tax treatment:
1. Simple tax calculation: Small-scale taxpayers cannot deduct the input tax, but calculate the value-added tax payable according to a certain proportion (collection rate) of sales. As of the knowledge cut-off date (2023), the VAT collection rate of small-scale taxpayers is generally 3%.
2. Preferential tax rate: Small-scale taxpayers can usually enjoy certain preferential tax rates. For example, in a specific period, China has implemented a preferential policy of reducing the rate 1% for small-scale taxpayers to collect value-added tax.
3. Simplified declaration: The tax declaration procedures of small-scale taxpayers are relatively simplified, and there is no need for complicated accounting and deduction of input tax and output tax.
4. Invoice management: Small-scale taxpayers can usually only issue ordinary invoices and cannot issue special VAT invoices. If the buyer needs special invoices, small-scale taxpayers need to go to the tax authorities to issue them.
5. Financial treatment: In accounting treatment, when small-scale taxpayers confirm the sales revenue, they directly confirm it according to the sales amount excluding tax, and the tax amount calculated by simple tax calculation method is included in "Taxes payable-VAT payable".
To sum up, tax rates and policies may change with time and geographical changes, so we should refer to the latest tax laws and specific requirements of tax authorities in actual operation.
Legal basis:
People's Republic of China (PRC) Accounting Standards for Business Enterprises
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Income refers to the total inflow of economic benefits formed by enterprises in their daily activities, which will lead to the increase of owners' rights and interests and has nothing to do with the capital invested by owners. The income involved in these Standards includes the income from selling goods, providing services and transferring the right to use assets.