Increased tax risk
In the course of business, self-employed persons need to declare tax on income generated from the sale of goods or provision of services in accordance with the law. However, when the self-employed exist in the case of sales without input, i.e., the sales record is obviously more than the input record, the tax authorities may suspect the authenticity of their sales income, which in turn increases the risk of tax inspection. In the tax inspection, if the self-employed cannot provide sufficient proof of purchase and reasonable explanation, they may be recognized as tax evasion and avoidance, and thus face fines, payment of back taxes or even legal liability.
Second, business difficulties
The situation of self-employed people having sales but no purchases may also lead to the emergence of their business difficulties. The long-term lack of purchase records means that self-employed people may not have enough inventory to support their sales activities, which in turn affects the normal operation of their business. In addition, the lack of proof of purchase can also put the self-employed at a disadvantage in their dealings with customers or suppliers, and they may face a crisis of confidence and a breakdown in cooperative relationships.
Three, compliance recommendations
In order to avoid the risk of the self-employed having sales without purchase, it is recommended that the self-employed strengthen the awareness of financial management and tax compliance. First of all, individual households should establish a perfect purchase and sales record system to ensure that every transaction is supported by clear documents. Second, self-employed households should regularly reconcile accounts with suppliers and customers to ensure the accuracy and completeness of transaction data. Finally, self-employed persons should actively understand and study tax regulations and policies to ensure that their business behavior meets the legal requirements.
In summary:
The situation of self-employed households having sales but no revenues will increase tax risks, lead to business difficulties, and may have a negative impact on the reputation and long-term development of self-employed households. Therefore, self-employed households should strengthen their awareness of financial management and tax compliance to ensure the legality and compliance of their business activities.
Legal basis:
The Law of the People's Republic of China on the Administration of Taxation Collection
Article 25 stipulates:
Taxpayers must truthfully apply for tax declarations in accordance with the provisions of the laws and administrative regulations, or the tax authorities in accordance with the provisions of the law, administrative regulations to determine the declaration period, the content of the declaration, and submit tax returns, financial and accounting statements and Tax authorities in accordance with the actual need to require taxpayers to submit other tax information.
The Provisional Regulations of the People's Republic of China on Value-Added Tax (VAT)
Article 9 stipulates that:
Taxpayers who purchase goods, services, services, intangible assets and real estate and obtain VAT deduction vouchers that do not comply with the laws, administrative regulations, or relevant regulations of the competent tax authorities of the State Council, the input tax shall not be deducted from the output tax.