When Will I Be Charged Interest on Late Payments?
The deferred payment interest refers to the interest paid by the construction unit on the installment of imported complete equipment in accordance with regulations.
Deferred payment interest
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- Chinese name
- Deferred payment interest
- the way
- VAT should be paid in accordance with relevant VAT regulations
- Definition
- Professional term
- Involved Disciplines
- economics
- The deferred payment interest refers to the interest paid by the construction unit on the installment of imported complete equipment in accordance with regulations.
- Article 6 of the "Interim Regulations on Consumption Tax" and Article 14 of its "Implementation Rules" provide that the basis for calculating consumption tax is the entire price and out-of-price expenses charged by the taxpayer to the purchaser for the sale of taxable consumer goods. "Out-of-price expenses" refers to funds, fund-raising fees, return profits, subsidies, liquidated damages (deferred payment interest) and handling fees, packaging fees, reserve fees, quality fees, transportation and handling fees, collection fees, Advance payments and other various off-price charges. However, the following amounts are not included: the freight invoice of the shipping department is issued to the purchaser; the taxpayer transfers the invoice to the purchaser. Other out-of-price expenses, whether or not they belong to the taxpayer's income, should be incorporated into sales for tax calculation. [1]
- Taxation of corporate deferred payment interest
- According to the "financial industry", other financial industry's business-to-enterprise deferred payment obtained by the other party during the business settlement process should be regarded as extra-value income of the enterprise, and should be paid business tax or value-added tax in accordance with relevant tax items. For example, if the interest received by a financial institution due to the deferred repayment of the borrower is paid as business tax according to the financial industry tax item, the interest collected by the construction enterprise due to the construction unit's arrears in construction work shall be paid as business tax as the building industry item Interest paid by the purchaser in arrears shall be subject to VAT in accordance with the relevant VAT regulations. [1]