There are the following differences:
1. Different concepts
1. Non-taxation
Refers to taxes that are not VAT Items within the tax scope.
2. Tax exemption
According to the relevant provisions of the tax law, certain projects are exempted from paying VAT on their income.
3. Zero tax rate
A type of value-added tax rate, mainly applicable to taxpayers’ export of goods and cross-border taxable activities. When calculating and paying value-added tax at zero tax rate, the output tax is calculated at a tax rate of 0%, and the input tax is allowed to be deducted.
2. Different applicable times
1. No taxation
There is no rigid applicable time period. Article 7 of the "Enterprise Income Tax Law" stipulates that income The following income in the total amount is "non-taxable income": fiscal appropriations; administrative fees and government funds collected in accordance with the law and included in financial management; other non-taxable income stipulated by the State Council.
2. Tax exemption
If a taxpayer engages in taxable behavior and is subject to tax exemption or tax reduction regulations, he may waive tax exemption or tax reduction and pay value-added tax in accordance with the regulations. After giving up tax exemption or tax reduction, you may not apply for tax exemption or tax reduction again within 36 months.
3. Zero tax rate
If a taxpayer sells services or intangible assets subject to zero VAT rate, it can waive the applicable zero VAT rate and choose to be exempt from tax or pay VAT as required. After giving up the application of the VAT zero-rating rate, you may not apply for the application of the VAT zero-rating rate again within 36 months.
3. Different authority to issue invoices
1. No taxation
No VAT invoices can be issued except in special circumstances. Article 21 of the "Interim Regulations of the People's Republic of China on Value-Added Tax" stipulates that items that are not subject to VAT do not themselves fall within the scope of VAT. Therefore, taxpayers who have items that are not subject to VAT cannot obtain income when they have items that are not subject to VAT. Issue VAT invoices.
2. Tax-free
General VAT invoices can be issued. According to Article 21 of the "Interim Regulations of the People's Republic of China on Value-Added Tax" (Decree No. 538 of the State Council of the People's Republic of China) and the "Implementation Measures for the Pilot Program of Replacing Business Tax with Value-Added Tax" (Finance and Taxation [2016] 36 Annex 1 of the Document No. 1) Article 53: VAT taxpayers selling tax-free goods are not allowed to issue special VAT invoices, but can only issue ordinary VAT invoices.
3. Zero tax rate
General VAT invoices can be issued. According to Article 21 of the "Interim Regulations of the People's Republic of China on Value-Added Tax" (Decree No. 538 of the State Council of the People's Republic of China) and the "Implementation Measures for the Pilot Program of Replacing Business Tax with Value-Added Tax" (Finance and Taxation [2016] 36 Annex 1 of the Document No. 1) Article 53: VAT taxpayers selling tax-free goods are not allowed to issue special VAT invoices, but can only issue ordinary VAT invoices.
Extended information:
1. Special circumstances in which non-taxable income can be invoiced
In the financing sale and leaseback business, although the lessee sells assets It is an item that is not subject to value-added tax, but many regions stipulate that in financing after-sale and leaseback services, the lessee can issue an ordinary invoice when receiving the principal price of tangible movables, which serves as a legal and valid certificate for the lessor to deduct the difference. The lessee issues an invoice. No VAT is levied.
2. Value-added tax items refer to tax-free income, which is an important part of the taxpayer’s taxable income. It is only the economic benefit obtained by the state in a specific period or for a specific project in order to achieve certain economic and social goals. The tax benefits provided are taken care of, and it is possible to restore the taxable income range within a certain period of time.
3. Since the prescribed tax rate is zero, taxpayers do not need to pay tax. What truly embodies the theoretical definition of zero tax rate is the implementation of zero tax rate for export products. That is, taxpayers’ export products can not only not pay the tax payable on the value-added amount of this link, but also can refund the tax paid on the previous value-added amount of each link. And only general taxpayer companies can fully enjoy the benefits of zero tax rate.
Reference material: Baidu Encyclopedia - zero tax rate
Reference material: Baidu Encyclopedia - tax exemption
Reference material: Baidu Encyclopedia - non-taxable income