SAT Releases Notice on VAT Input Tax Deductions in Fund Projects
Aug. 19 – The State Administration of Taxation recently released a notice regarding several issues on VAT input tax deductions in financing fund projects, effective October 1, 2010.
Issued August 9, the notice stipulates that special VAT invoices and other deductible documents, acquired during the construction period of the projects funded by the trust capital, can be used in tax deduction in accordance with the relevant provisions of the current VAT in effect.
Projects funded by the trust capital are developed by the operational sides cooperating with the approval of trustees. During such projects, the trustees are responsible for raising funds and establishing trust schemes while the operational sides are in charge of the construction and operations. When the projects are completed, the assets belong to the operational side.
According to the notice, the input taxes that were not deducted by October 1 are allowed to be deducted, and those that have been deducted shall not be used in transferring input taxes.