Point of view | Whether the company's motor vehicle has been registered for transfer of ownership must pay VAT.
Published:
2024-06-03
Does the company's motor vehicle have to pay VAT when it is registered for transfer?
Basic case:A company bought a car in January 2021 with an amount of 700000 yuan excluding tax. Due to a traffic accident, the company's shareholders thought the license plate number was unlucky and handed over to the company's individual shareholders in January 2023. However, apart from the change of the license plate number, in fact, the car was still actually used by the company and was not delivered to the individual shareholders. The tax authorities informed the company to repay the VAT and overdue fine of about 120000 yuan according to the market price in January 2023.
Is the registration of a motor vehicle of a 1. company equivalent to the transfer of ownership of the motor vehicle?
First of all, motor vehicles are a special kind of movable property. Although the traffic management department of the public security organ has carried out compulsory registration of motor vehicles in accordance with the Road Traffic Safety Law and its implementing regulations, the compulsory registration of motor vehicles by the public security organ is only an administrative measure, not the property rights stipulated in the Property Law. Registration. Therefore, the registered owner of a motor vehicle is not necessarily the owner of the vehicle. In this regard, the Ministry of Public Security made the same conclusion in the relevant "Reply" as early as 2000-"Motor vehicle registration is the registration of granting or not allowing motor vehicles to drive on the road, not the registration of motor vehicle ownership, and the registered owner should not be used as the basis for judging the ownership of motor vehicles."
Secondly, since motor vehicles are not real estate such as houses and land, article 224 of the Civil Code stipulates that the establishment and transfer of movable property rights shall take effect from the time of delivery, unless otherwise provided by law. Article 225 stipulates that the establishment, alteration, transfer and extinction of property rights such as ships, aircraft and motor vehicles shall not be against bona fide third parties without registration. In other words, the transfer of ownership of a vehicle between the parties to the sale of the vehicle has legal effect even if there is no registration. Only unregistered changes in property rights cannot be opposed to bona fide third parties. Therefore, in the case where the company's motor vehicle was registered for transfer, but was not delivered and the company was still in use, the ownership of the motor vehicle was not transferred.
Although the 2. motor vehicle has been registered for transfer, the company is still using it. Is it a taxable act of value-added tax under the premise that the ownership of the company's motor vehicle has not been transferred?
Article 1 of the Provisional Regulations on the the People's Republic of China of Value-Added Tax stipulates that units and individuals that sell goods or process, repair and repair services, sell services, intangible assets, real estate and imported goods within the territory of the People's Republic of China are taxpayers of value-added tax and shall pay value-added tax in accordance with these regulations.
Article 3 of the Rules for the Implementation of the Provisional Regulations on the People's Republic of China Value-Added Tax stipulates that the sale of goods referred to in Article 1 of the Regulations refers to the paid transfer of ownership of the goods.
In summary, the payment of VAT presupposes the occurrence of a "taxable sale", I .e. a transfer of ownership. In the case that the company's motor vehicle only changes the license plate number, but the vehicle has not been delivered, the ownership has not been transferred, and it is still used normally by the company, the company simply only handles the registration of the motor vehicle transfer, which is not a "taxable sales act" of value-added tax, and there is no need to pay value-added tax.
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