Venture capital tax Incentives released

In order to implement the preferential policy of venture capital enterprise income tax and promote the development of venture capital enterprises, the State administration of taxation issued on April 30 the "notice on the implementation of the preferential income tax for venture capital Enterprises" (National tax 2009]87, hereinafter referred to as 87th), officially released recently.

In November 2005, the ten Ministries of the State Council jointly issued the interim measures for the administration of venture Capital Enterprises (hereinafter referred to as "interim measures"), stipulating that "the state uses tax preferential policies to support venture capital enterprises to develop and guide them to increase investment in small and medium-sized enterprises, especially medium and small-sized High-tech enterprises." "In order to tie in with the implementation of the interim measures, February 2007, the Ministry of Finance and the State administration of taxation on the joint issue of the promotion of venture capital enterprises to promote the development of relevant tax policy notice ((tax [2007]31, hereinafter referred to 31st), The notice first establishes the basic principle of the tax policy to promote the development of venture capital enterprises in our country. The "Enterprise Income Tax Law" issued in March of the same year, through the 31st, "Venture capital enterprises engaged in the country needs to focus on support and encourage entrepreneurial investment, can be a certain proportion of investment deductible taxable income" provisions, confirmed the 31st article established the Basic Principles.

However, after the release of the 31st text, the majority of provinces and cities were not implemented in time except Zhejiang, Jiangsu, Jiangxi, Liaoning and other few provinces. The main reason is that the local tax department believes that the state finance and taxation departments should be in accordance with the newly issued "Enterprise Income Tax Law" to redefine the preferential policies of venture capital investment, can be implemented concretely.

The State Administration of taxation issued the article 87th, the purpose is to implement the 31st text to promote the development of venture capital enterprises in the tax policy, as well as the "Enterprise Income Tax Law" relevant provisions. From the core content, the 87th text of the clear tax preferential policy and the 31st text is consistent: first, the implementation of the tax preferential policy is a venture capital enterprises; The other is the tax concession is deducted taxable income Third, the basic condition of the tax preference is that the qualified venture capital enterprises adopt the equity investment way to invest in unlisted medium and small-sized High-tech enterprises over 2 years; four is the tax preferential strength is still according to the venture capital enterprise to Medium and small-sized High-tech Enterprise Investment 70%, When the equity holder has been held for 2 years, the taxable income of the venture capital enterprise is deducted, and the deduction can be carried forward in the subsequent tax year.

At the same time, on the basis of summarizing the implementation of article 31st, article 87th further clarified the following four matters:

Firstly, since article I of the Enterprise Income Tax Law stipulates that "the partnership does not apply this law", the preferential tax policies for venture capital enterprises as stipulated in article 31st of the Act shall not apply to unincorporated enterprises such as partnerships, therefore, article 87th is in the first paragraph of article II, The first condition of the venture capital Enterprise, which clearly stipulates the application for taxable income deduction, is "the business scope complies with the interim measures", and the industry and Commerce Register as ' venture capital limited liability company ', ' Venture Capital Co., Ltd. ' and other professional venture capital enterprises. Among them, corporate venture capital Enterprises, in addition to the company-type venture capital enterprises, but also the establishment of a few years ago, the form of business entities of various types of entrepreneurial investment centers.

Second, although the article 31st issued in 07 also applies to the establishment of the "Foreign investment venture capital Enterprise management provisions", unified according to the "interim measures" record of venture capital enterprises, however, as no mention of the "Foreign investment venture capital Enterprise management Regulations", many market people mistakenly believe that the 31st text does not consider foreign-invested venture capital enterprises. A few days ago, the article 87th is clearly mentioned in the first article in accordance with the "Foreign investment venture capital Enterprise management Regulations" set up by foreign investment venture capital enterprises. At the same time, in order to reflect the "unified policy, unified standards" principle, whether the domestic venture capital enterprises, or foreign-invested venture capital enterprises, should comply with the second paragraph of the requirements, "in accordance with the provisions of the interim measures and procedures for the completion of the record, after the Record Management department annual inspection and verification, investment operation in line with the interim measures .

Thirdly, considering the actual development and change of the invested enterprises in the technological content and the scale of the enterprises, the article makes a dynamic understanding of the meaning of "High-tech enterprises of SMEs". On the one hand, the small and medium-sized High-tech enterprises that stipulate the investment of venture capital enterprises shall, in addition to the new "management measures for the identification of High-tech enterprises" and "Guidelines on the management of High-tech Enterprises", should also meet the number of employees not exceeding 500, and the annual sales (operating) amount not exceeding 200 million yuan, The condition of the total assets not exceeding 200 million yuan. On the other hand, it is clear that "by the end of 2007, according to the original requirements of High-tech enterprises to obtain the qualifications of small and medium-sized High-tech Enterprises, and in 2008 continue to meet the new High-tech enterprise standards, to its investment over 24 months of calculation, can be from the actual venture capital investment time from the calculation. At the same time, small and medium-sized enterprises in the acceptance of venture capital can not be High-tech enterprises, but only after the acceptance of venture investment by the identification of High-tech enterprise standards, and since it has been identified as High-tech Enterprises in the annual investment over 2 years. As for the scale standards of enterprises, as long as the investment is small and medium-sized enterprises on the line, after the investment enterprise size exceeds the standards of SMEs, but still meet the standards of High-tech enterprises, does not affect the venture capital enterprises to enjoy the relevant tax concessions.

The process of applying for preferential tax policies for venture capital enterprises has been reduced. In accordance with article 31st issued in 07, when a venture capital enterprise applies for an investment deduction taxable income, the local competent tax authorities shall, after summarizing and approving the application materials of the venture capital enterprise and signing the relevant opinions, report to the superior competent authorities at different levels of the Record Management department. The publication of article 87th only requires "to submit the relevant information to the competent tax authorities before submitting an application for investment deduction for the annual tax returns of taxable income".

It is generally believed that the issue of excessive tax deduction for taxable income tax according to the double standard of "size" and "technical content" of the invested enterprises, on April 11, the "2009 China Venture Investment Forum", jointly organised by the Beijing University venture Capital Research Center and the Venture Capital Research Center, The head of the state finance and Taxation department said that in the future, according to the "Enterprise income Tax Law" to determine the basic principles, and constantly improve the promotion of venture capital Enterprise Development Tax policy.