Can loan interest be deducted?

Loan interest cannot be deducted from VAT.

the provisions on matters related to the pilot project of changing business tax to value-added tax stipulates that the input tax shall not be deducted from the output tax when the taxpayer accepts the loan service and pays the lender the investment and financing consulting fees, handling fees and consulting fees directly related to the loan.

the pilot implementation measures for changing business tax to value-added tax also clearly stipulates that the input tax of the following items shall not be deducted from the output tax: purchased passenger transportation services, loan services, catering services, daily services of residents and entertainment services.

Can the loan service be deducted from the input?

The input tax is not deductible for the loan service expenses incurred by the general taxpayer.

1. the provisional regulations and the detailed rules for implementation stipulate that taxpayers who use purchased goods or taxable services for non-taxable items, tax-exempt items, collective welfare or personal consumption and suffer abnormal losses shall not be deducted from the output tax. However, because the specific use of goods or taxable services cannot be determined at the time of purchase, the input tax amount of the purchased goods or taxable services is often deducted from the output tax amount of the tax period at the time of purchase. However, when these behaviors that should not be deducted from the output tax amount occur, they should be treated as non-deductible. This requires that the input tax amount of goods or taxable services that should not be deducted be calculated and deducted from the current input tax amount during the tax period when these acts occur, and the following situations should be distinguished for treatment.

second, it is used for fixed assets under construction, collective welfare or personal consumption. Purchased goods or taxable services used in fixed assets construction in progress are not based on whether they are accounted for in the subject of "construction in progress". Even if taxpayers' expenditures on building repair and decoration should not be accounted for in the subject of "construction in progress", the purchased goods or taxable services in their expenditures are also used in fixed assets construction in progress as stipulated in the tax law. Similarly, even if the purchased goods or taxable services used for collective welfare and personal consumption are not accounted for in the subjects of "wages payable", "welfare expenses payable" or "surplus reserve", the input tax amount cannot be deducted from the output tax amount.

third, abnormal losses. Generally, the input tax on purchased goods or taxable services consumed by abnormal loss of goods and abnormal loss of products in process and finished products has been deducted in previous tax periods. After a loss occurs, it is generally difficult to verify when the lost goods were purchased in the past. The original purchase price and input tax cannot be accurately verified. Therefore, the non-deductible input tax should be calculated according to the principle we introduced in Example 25. The actual cost of the lost purchased goods or taxable services in products and finished products should be calculated with reference to the current cost data of the enterprise.

iv. for tax-free items and non-taxable items. In general, the non-deductible input tax for goods or taxable services used for tax-free items and non-taxable items can be calculated according to the actual purchase price of the enterprise or the actual cost carried forward. Some enterprises, such as commercial enterprises, tend to divide the goods into several categories because of the variety of goods they operate, and calculate the sales cost according to the categories. The actual cost of a duty-free goods in the categories cannot be found, so the input tax for duty-free goods cannot be accurately calculated.

can the loan interest be deducted from the value-added tax?

no.

according to the policy of camp reform, the "purchased loan service" cannot be deducted from the output tax, and at the same time, it is stipulated that the input tax of the taxpayer who accepts the loan service and pays the lender the investment and financing consulting fees, handling fees and consulting fees directly related to the loan cannot be deducted from the output tax. Interest expenses and other directly related expenses paid by enterprises need to pay 6% value-added tax after the reform of the camp, and this part of the tax can not be deducted from the input.

loan interest refers to the reward that the lender gets from the borrower for issuing monetary funds, and it is also the price that the borrower must pay for using the funds. The bank loan interest rate refers to the ratio of the interest amount to the principal amount during the loan period. To determine the interest rate of a loan contract with banks and other financial institutions as lenders, the parties can only negotiate within the upper and lower limits of the interest rate stipulated by the Bank of China.

if the loan interest rate is high, the repayment amount of the borrower will increase after the loan term, otherwise, the bridge will decrease. There are three major factors that determine the loan interest: loan amount, loan term, and loan code interest rate.

Let's stop here for the introduction that the loan service can be deducted.