SAT Clarifies Issuance of IIT Payment Receipts

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Jul. 7 – The State Administration of Taxation recently clarified the issuance of individual income tax payment receipts and other related issues.

The State Administration of Taxation recently issued a notice regarding the management approach on individual income tax payment receipts, aiming to further regulate the procedures and to enhance tax authorities’ efficiency.

The Circular on Further Improving the Issuance of Individual Income Tax Payment Receipts (Guoshuifa [2010] No. 63), issued on June 28, stipulates that all the local taxation bureaus should issue tax payment certification directly to the taxpayer (when the tax is levied directly, such as self-employed business income tax), or inform the taxpayer about their withholding tax which already paid through by issuing tax payment certification or using the website, text message and other possible ways.

Beginning August 1, 2010, tax payment certifications issued to individual taxpayers should be in the new format.

Tax authorities will now also need to ensure that withholding agents fulfill their obligations to disclose the tax information to taxpayers. Agents will need to mark the amount of withholding tax in the payroll; they will also need to issue a withholding tax collection certificate upon the taxpayer’s request.