On April 25, 2022, Xiangjiang Company (which has not yet implemented the new financial instrument standards) paid 1.06 million yuan to purchase 100,000 shares issued by Nanyue Company from the secondary market at a price of 10.6 yuan per share (including 0.60 yuan of cash dividends that have been declared but not yet paid), and paid 10,000 yuan in transaction costs. Xiangjiang Company classified the equity of Nanyue Company as trading financial assets, and the equity of Nanyue Company did not have a significant impact on it after holding the equity of Nanyue Company. On December 31, 2022, the stock price of Nanyue Company rose to 13 yuan per share. On September 26, 2023, Xiangjiang Company sold all the shares of Nanyue Company held by Xiangjiang Company at a price of 15 yuan per share. It is assumed that no other factors are taken into account.
The accounting and tax treatment of Xiangjiang Company are as follows:
(1) On April 25, 2022, the shares of Nanyue Company were purchased
Borrow: trading financial assets - cost 1 000 000
Dividends receivable 60 000
Investment income 1 000
Credit: Bank deposits 1 061 000
Tax treatment of this business: the transaction cost of trading financial assets is 1,000 yuan, which should be regarded as the taxable cost of trading financial assets in the tax law, and does not affect the taxable income.
(2) On December 31, 2022, the stock price change was confirmed
Borrow: Trading financial assets - change in fair value 300 000
Credit: Fair value change gain or loss 300 000
Tax treatment of this business: the amount of fair value change profit and loss in accounting is 300,000 yuan, and the income is not recognized in the tax law.
2022 Annual Enterprise Income Tax Final Settlement and Filing:
(3) On September 26, 2023, Xiangjiang Company will purchase all the shares of Nanyue Company and sell them
Borrow: bank deposit 1 500 000
Fair value change gain or loss 300 000
Credit: Trading Financial Assets - Cost 1 000 000
- Change in fair value 300 000
Investment income 500 000
Tax treatment of this business: Due to the different tax basis and book value of the trading financial assets, there are different disposal gains and losses, which need to be adjusted.
2023 Annual Enterprise Income Tax Final Settlement and Reporting:
Partial amplification:
Key points and precautions for filling in the detailed statement of tax adjustment of investment income (A105030).
This form is applicable to taxpayers who have investment income tax adjustment items and taxpayers engaged in equity investment business. Taxpayers shall fill in the accounting treatment of investment income, tax regulations, and tax adjustments in accordance with the relevant provisions of the Tax Law, Guo Shui Han [2010] No. 79, and the national unified enterprise accounting system.
Caution:
1. Investment income incurred during the holding period and treated as tax-exempt income (such as interest income from treasury bonds) in accordance with tax regulations shall not be adjusted in this table.
2. If the disposal of investment projects is recognized as a loss in accordance with the tax regulations, it shall not be adjusted in this table, and the tax adjustment shall be made in the "Detailed Statement of Pre-tax Deduction and Tax Adjustment of Asset Losses" (A105090).
3. If the disposal of investment projects that comply with the provisions of enterprise restructuring and are subject to special tax treatment, they shall not be adjusted in this table, and shall be adjusted in the "Tax Adjustment Schedule of Enterprise Restructuring and Deferred Tax Items" (A105100).
4. Clarify and refine the "Instructions for Filling in Relevant Items" to guide taxpayers who implement the new financial standards to fill in the report. For the implementation of the Accounting Standards for Business Enterprises No. 22 - Recognition and Measurement of Financial Instruments (Cai Hui [2017] No. 7), Accounting Standards for Business Enterprises No. 23 - Transfer of Financial Assets (Cai Hui [2017] No. 8), Accounting Standards for Business Enterprises No. 24 - Hedge Accounting (Cai Hui [2017] No. 9), and Accounting Standards for Business Enterprises No. 37 - Presentation of Financial Instruments (Cai Hui [2017] No. 14) (the above four items are referred to as "New Financial Standards") If the category of investment income is not from lines 1 to 8 of this form, the relevant accounting treatment, tax regulations, and tax adjustments shall be filled in line 9 "9. Others".
Case source: Hunan Tax, transferred from: Yan Tax. The content of this article is for general information purposes only and is not intended as formal auditor, accounting, tax or other advice, and we cannot guarantee that such information will remain accurate in the future. No person should act on the basis of the information contained herein without having due regard to the relevant circumstances and obtaining appropriate professional advice. The articles reproduced in this issue are for academic exchange purposes only. The original copyright of the article or material belongs to the original author or original copyright owner, and we respect copyright protection. If you have any questions, please contact us, thank you!