Firstly, since January 1, 2009, general VAT taxpayers (hereinafter referred to as the taxpayers) can purchase (including acceptance of donations and in-kind investments, hereinafter referred to as the taxpayers) or self-produced (including alteration and expansion, installation, hereinafter referred to as the taxpayers) fixed assets. The input tax incurred (hereinafter referred to as input tax on fixed assets) can be paid in accordance with the relevant provisions of the Provisional Regulations on Value-added Tax of the People's Republic of China (Decree of the State Council No. 538, hereinafter referred to as the Regulations) and the Implementing Rules for the Provisional Regulations on Value-added Tax of the People's Republic of China (Decree of the Ministry of Finance and the State Administration of Taxation No. 50, hereinafter referred to as the Rules) by virtue of the value-added tax invoices, the special payment certificate for VAT on importation and the settlement of transportation cost. (hereinafter referred to as the VAT deduction vouchers) from the output tax amount, and the input tax amount shall be credited to the account of "Taxes Payable - VAT Payable (Input Tax)".
Therefore, the input tax on the use of self-produced products for the production of business equipment and VAT for the expansion and installation of fixed assets is allowed to be deducted. Its value-added tax is not included in the recorded value of fixed assets