Issues Related to Tax to be Paid by Taxpayers Who Sell Fixed Assets Attached to Land or Real Estate

 2018-03-09  1528


Announcement of the State Administration of Taxation on Issues Related to Tax to be Paid by Taxpayers Who Sell Fixed Assets Attached to Land or Real Estate while Transferring Land-use Right or Selling Real Estate

Announcement of the State Administration of Taxation [2011] No. 47

August 17, 2011

Issues related to tax to be paid by taxpayers who sell fixed assets attached to land or real estate while transferring land-use right or selling real estate are hereby announced as follows:

If any of those fixed assets attached to land or real estate which is sold by taxpayers when transferring land-use right or selling real estate belongs to goods subject to VAT, the VAT shall be calculated and paid according to the relevant provisions of Article 2 of the Circular of the Ministry of Commerce and the State Administration of Taxation on the Policy of Subjecting Some Goods to Low VAT Rates and Tax Collection Simplified Procedures (Cai Shui [2009] No. 9); if any of those fixed assets belongs to real estate, the business tax shall be calculated according to the tax item of "the sale of real estate " of the Interim Regulations of the People's Republic of China on Business Tax.

Taxpayers shall assess goods subject to VAT and sales amount of real estate respectively. If the goods subject to VAT and sales amount of real estate are not assessed respectively or unclearly, the competent tax authority shall determine the sales amount of goods subject to VAT and of real estate.

This Announcement shall come into force from September 1, 2011.The provisions of the Official Reply of the State Administration of Taxation on Issues Related to the Collection of Business Tax for Transfer of Coal Mines by Coal Enterprises (Guo Shui Han [1997] No. 556) and the Official Reply of the State Administration of Taxation on Issues Related to the Collection of Business Tax for the Transfer of Coal Mines (Guo Shui Han [2007] No. 1018) that "if units or individuals transfer land-use right of coal mines or sell real estate and transfer electromechanical equipment attached to land or real estate at the same time, the business tax for those electromechanical equipments shall be levied in line with the collection of business tax for 'the sale of real estate' " shall be abolished simultaneously. The matters which have been dealt with before this Announcement comes into effect shall not be changed and matters which have not been dealt with shall be dealt with in accordance with this Announcement.

The Announcement is hereby made.