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General Taxpayer or Small Scale Taxpayer?
All companies in China have to pay value-added tax ( “VAT” ) based on their taxable revenue. According to related taxation laws of China, VAT taxpayers are categorized into general taxpayers and small scale taxpayers based on their annual taxable sales.
Taxpayers with annual revenue exceeding the ceiling set for small scale taxpayers must apply for general taxpayer status. The current ceiling for all companies is 5million RMB a year.
Then, what’s the difference between these two kind of taxpayers and can we choose what kind of taxpayer to be, and if yes, how?