What are the contents and tax rates of construction services?
Construction services include decoration services, repair services, engineering services, installation services, and other construction services. If a general taxpayer provides construction services and is taxed according to the general taxing method, the tax rate is 9%; if it is taxed according to the simple taxing method, the tax rate of 3% applies. Small taxpayers who provide construction services are all subject to VAT at a 3% rate.
Specific contents of construction services
I. Decoration services. Decoration services refer to the engineering work of finishing and decorating buildings and structures to make them beautiful or for specific purposes.
Two, repair services. Repair services refers to the buildings, structures, repair, reinforcement, maintenance, improvement, so that it restores the original value of the use or to extend the duration of its use of engineering operations.
Three, engineering services. Engineering services refers to the new construction, reconstruction of various buildings, structures, including the building connected to the installation of various equipment or pillars, operating platforms or installation of engineering operations, as well as a variety of furnaces and metal structures engineering operations.
Four, installation services. Installation services refers to the production equipment, power equipment, lifting equipment, transportation equipment, transmission equipment, medical laboratory equipment, and various other equipment, facilities, assembly, placement of engineering operations, including workbenches, ladders, railings connected to the equipment being installed installation of engineering operations, as well as being installed equipment, insulation, anticorrosion, heat preservation, painting and other engineering operations.
V. Other construction services. Other construction services refers to a variety of engineering services other than the above listed engineering operations, such as drilling (drilling), demolition of buildings or structures, land leveling, landscaping, dredging (excluding channel dredging), building grading, scaffolding, blasting, mine perforation, surface attachments (including rock, soil, sand, etc.) stripping and cleaning up and other engineering operations.
Are construction services a modern service?
No. Modern services include research and development and technical services, information technology services, cultural and creative services, logistics support services, leasing services, forensic consulting services, broadcasting and film services, business support services and other modern services.
Accounting entries in the construction industry
1. Revenue accounting
When you receive the advance payment for the project:
Borrow: bank deposits
Loan: advance receipts
When you complete the project and settle the account:
Borrow: advance receipts
Loan: project settlement
Carry forward the income:
Debit: Project Settlement
Loan: Profit for the year
2. Accounting for Costs
Materials incurred during the construction process:
Borrow: Engineering Construction - Material Costs
Loan: Bank Deposits/Cash on Hand
Payment of Labor:
Borrow: Construction - Labor Costs
Loan: Cash on Hand/Compensation Payable to Employees
Machinery Costs Incurred:
Borrow: Construction - Machinery Usage Costs
Loan: Bank Deposits/ Accumulated depreciation, etc.
Other direct costs incurred
Borrow: Construction - Other direct costs
Credit: Bank deposits/cash on hand
Completion of works settlement:
Borrow: Works settlement
Credit: Construction
Carry forward costs:
Borrow: profit for the year
Loan: project settlement
3. Tax accounting
When withdrawing:
Borrow: taxes and surcharges
Loan: taxes payable
Carry forward taxes:
Borrow: profit for the year
Loan: taxes and surcharges
4, If the total projected contract cost is greater than the total projected contract revenue:
Borrow: Asset impairment loss
Loan: Provision for decline in value of inventories