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On the new enterprise income tax law of the M & a tax planning skills

Author: HuXuanNeng From: www.yourpaper.net Posted: 2010-06-07 19:49:31 Read:

Abstract: tax arrangements for acquisition of enterprises are taxable and tax-exempt two arrangement, this paper discusses the different way of M & A and under different payment methods in M & a tax planning skills.Enterprise merger and acquisition points tax arrangements for: first, the parties involved in M & a need to negotiate with each other, to choose the best tax planning scheme makes the total tax value; secondly, the need for income tax calculation according to the specific conditions of payment and the acquisition of both parties involved in mergers and acquisitions, analysis of losses and net asset value evaluation of overall arrangement.
Keywords: the mergers and acquisitions; mergers and acquisitions; payment; tax arrangements for

In January 1, 2008, China will implement the new "enterprise income tax law", the new "enterprise income tax law" has a great change in the tax rate, pre-tax deduction, tax revenue preferential policy and so on.These changes will be on the acquisition of Chinese enterprises tax planning and have an important impact on schedule.Mergers and acquisitions (Merger& Acquisition, referred to as M& A) is a general name of enterprise merger and acquisition holdings.Enterprise merger can be divided into two kinds, namely the merger and acquisition holdings, but many forms, such as merger, acquisition, replacement of assets, reorganization of assets, stock exchange, stock right transfer.Enterprise merger and acquisition of enterprises connotation is broad, including the legal status of economic entities, but also does not have the legal status of economic entities, such as independent accounting, within the scope of authorization is relatively independent business department.The motive of M & A is varied, such as in order to expand the operation scale, the elimination of competitors, spread the investment risks, but the motivation of tax can not be ignored.General tax-related enterprises M & a huge amount, the reasonable and legitimate tax planning will bring great benefits to all parties involved in the merger and acquisition.Enterprise merger and acquisition belongs to the category of property right capital operation, restructuring of different level, and product management, enterprise mergers and acquisitions generally do not need to pay value added tax, business tax, turnover tax, because of this, an important means of enterprise merger and acquisition is often as disposal of assets of value-added tax or business tax evasion.Therefore, tax planning and arrangement of enterprise merger and acquisition is mainly for the enterprise income tax.This paper mainly on the planning issues of enterprise income tax on different M & a mode and different methods of payment of corporate mergers and acquisitions tax planning skills.
well, and well under the tax planning
Merger is a merger of the enterprise has acquired business (also known as the target of the enterprise's net assets or equity) composed of a single economic entity and legal entity business activities.Merger is also known as the full acquisition or asset acquisition, is a special form of buy-out, which can be subdivided into two ways, namely the merger by absorption.
(a) to absorb the merger of
tax arrangements
Merger is a merger of the enterprise net assets acquired all the target enterprise (or stock), the target enterprise was disbanded.Merger of the enterprise can use cash, bonds or shares way to exchange for the target enterprise net assets (or stock).To absorb the merger is still the result of a single economic entity and legal entity.
The 1 goals of the enterprise legal person status be canceled, and the clearing of enterprise income tax (taxable treatment).
Guoshuifa [2000] No. 119 "notice" the State Administration of Taxation on enterprise merger and division problems related to the business tax provisions, the merger of enterprises should generally be used taxable treatment: the target of the enterprise shall be regarded as the transfer, according to the fair value of all assets disposal, computing assets transfer income, income tax shall be paid in accordance with the law; the target enterprise the losses of the past year, shall not node to the merger of the enterprise make up the merger of the enterprise assets; accept the target enterprise, the tax can be determined according to the cost assessment of iodine value of target recognition, the shareholders of the enterprise to obtain merger of the enterprise's stock rights as liquidation distribution.
Merger of the enterprise to consider the tax arrangements, the target enterprise should have more losses.For example, a merger case, the target enterprise nearly 5 years accumulative total can be deducted from the taxable income of -600 million, mergers and acquisitions, the net assets of 5000000 yuan, fair value of the identifiable net assets of 8000000 yuan, merger of the enterprise to pay, 10000000 yuan acquisition target enterprise all the net assets in order to complete absorption of the merger.When the net asset of target enterprises transfer price exceeds its book net assets of the part in 6000000 yuan, the income from the transfer target enterprise will not exceed 6000000 yuan, and loss of balance can not be generated after the liquidation income, without payment of enterprise income tax.In this case the payment of the price, 10000000 yuan, net assets of the target enterprises transfer income is 5000000 yuan, and loss on the liquidation income of -100 million, need not pay enterprise income tax, indicating that the target enterprise in this situation the liquidation process without adding any income tax burden.But the merger of the enterprise will obtain the enterprise income tax credit benefits, because according to the regulation, merger of the enterprise to the target enterprise fair value of the identifiable net assets of 8000000 yuan, and can be depreciated or entry costs, so that the target enterprise assets tax base than the original book value 3000000 yuan higher.Merger of the enterprise payment is higher than the target enterprise fair value of the identifiable net assets 2000000 yuan of parts as goodwill, according to the new "enterprise income tax law implementation rules", purchased goodwill expenditure in the bulk transfer or liquidation may be deducted; the amortization of intangible assets calculated under the straight-line method may be deducted.The new tax law purchased goodwill is not amortized, only to wait until the bulk transfer or liquidation may be deducted before tax.The tax base to make goodwill into assets, way is to increase the target enterprise fair value of the identifiable net assets, thereby reducing the amount of goodwill.How to increase the amount of the fair value of identifiable net assets? This needs in the assessment of the target enterprise net identifiable assets, try to identify and measure the target of the intangible assets of the enterprise, because the fair value of the identifiable net assets include tangible assets, including the intangible but identifiable intangible assets.
The target enterprises generally have in the account without recording but exist in practice of intangible assets, these identifiable intangible assets mainly has five categories: one is the trademark of intangible assets: product trademark, certification mark or mark pattern, press cover, the Internet domain name; two is the customer class intangible assets: a list of customers, orders and production orders, sales contracts; the three is about the art of intangible assets: drama, literature, music, painting, photography, audio and video products; four is the contract type of intangible assets based on: the right to use the patent, licensing, contract, service or supply the lease agreement, franchise such as mining rights; five is the technical intangible assets: Based on patented technology, computer software and embedded chip, non-patented technology or proprietary technology, database, business secret recipe formulation such as merger of enterprises should be fully and intermediaries consultation in the assets evaluation, as far as possible the identification and measurement of intangible assets, the goal of the enterprise to pay the fair value of the identifiable net assets as close as possible to the M & a party to the price, in order to reduce the amount of goodwill.
The 2 goals of the enterprise legal person status be canceled, without clearing treatment of corporate income tax (duty-free treatment).
this tax arrangements first needs to meet the condition that tax law, pay the price must be equity or voting shares, and shares in nominal terms shall be accounted for more than 80% of Guoshuifa [2000] 119 article, merger of the enterprise payment to pay the price of the target enterprise, except for the merger of the enterprise ownership other than cash, securities and other assets, are not higher than the pay equity par value (book value or payment of share capital) 20%, confirmed by the taxation authority, merger income tax can be treated with a duty-free treatment, can also use the taxable treatment.The duty-free treatment shall be handled in accordance with the following provisions: target enterprises do not confirm that all the assets transfer income or loss, do not calculate pay income tax matters; all enterprises merger and acquisition before income tax borne by the merger of the enterprise; the losses of the past year, if not more than the legal remedy period, by the merger of the enterprise to continue subsequent years for realization of the goal of enterprise assets and related income in accordance with the provisions of.
This exemption treatment applies only to the merger of the enterprise through the equity payment to complete the merger target of the enterprises.When the target enterprises with little or no losses, and the premium is relatively large, the duty-free treatment to arrange quite favorable to the goal enterprise, but did not produce the tax benefit on the merger of the enterprise, because the tax base of net assets of the target enterprise enterprise obtained is the original book value rather than fair value.At the same time, this arrangement shall also go through the relevant tax authorities for examination and approval.
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