- China issued new VAT deduction guidance effective January 1, 2026, overriding previous rules.
- The announcement clarifies VAT deduction methods for goods, services, asset restructuring, mixed-rate transactions, and financial operations.
- Specific deduction rules are provided for vehicles, transportation, tolls, and overseas transactions, requiring proper documentation.
- Asset restructuring VAT deductions are allowed if the business is transferred as a whole for legitimate purposes, with both parties as general taxpayers.
- The guidance details VAT timing for various transactions, including real estate, long-term goods, advance payments, and financial institution interest.
Source: regfollower.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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