Q：
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If the transaction contract or agreement stipulates that the lease term spans multiple years and the rent is paid in advance in a lump sum, how should revenue be recognized?
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A：
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If the transaction contract or agreement stipulates that the lease term spans multiple years and the rent is paid in advance in a lump sum, according to the principle of income and expense ratio stipulated in Article 9 of the Implementation Regulations, the lessor may evenly recognise lease income on a straight-line basis over the lease term.
If the lessor is a non-resident enterprise that has established institutions or premises within China and adopts the method of declaration and payment of enterprise income tax according to the facts, the provisions of this article shall also apply.
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Q：
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Is it necessary to pay corporate income tax for the additional value-added tax deduction claimed by enterprises which enjoy the policy of additional deduction for value-added tax?
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A：
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The additional value-added tax deduction enjoyed by the enterprise according to the policy needs to be included in the total amount of chargeable income and calculate income tax according to regulations.
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Q：
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The company did not obtain invoice in a timely manner for payment made due to the counter party's company was deregistered, and it is impossible to obtain the invoice. Can the company deduct the expense before enterprise income tax using the contract as proof?
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A：
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In the process of issuing or replacing invoices or other external vouchers, if an enterprise is unable to issue or replace invoices or other external vouchers due to special reasons such as the other party's cancellation, revocation of business license in accordance with the law, or being recognized as an abnormal company by the tax authorities, the expenses can be deducted before tax using the following information to prove the authenticity of the expenses:
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Proof materials for reasons such as inability to issue or replace invoices, or other external vouchers (including proof materials such as industrial and commercial deregistration, institutional revocation, inclusion in abnormal business operations, bankruptcy announcement, etc.).
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Contracts or agreements related to business activities.
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Payment vouchers for non-cash payments made.
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Proof of transportation of goods.
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Internal vouchers for inbound and outbound goods.
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Enterprise accounting records and other materials.
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Q：
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What types of non-monetary asset losses do enterprises have?
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A：
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Inventory loss, fixed asset loss, intangible asset loss, construction in progress loss, productive biological asset loss, etc.
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Q：
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The houses built by the enterprise have started to be used, but some invoices in the project payment have not been received yet. Should depreciation be calculated based on the invoice voucher or the contract amount?
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A：
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If the project payment has not been fully settled yet and invoice for full amount has not been obtained, depreciation can be temporarily accounted for based on the tax base of fixed asset according to the amount specified in the contract, and adjustments will be made after the invoice is obtained. But this adjustment should be made within 12 months after the fixed assets are put into use.
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FAQ
