XX CO., LTD.Tax Planning Research

Tax planning is a prior arrangement and planning of an enterprise on business investment, operation and financing to achieve the lightest or the best tax burden and maximize profits by taking advantage of tax preferences conferred by tax laws and regulations or choices on the premise of complying with tax laws and regulations and relevant legislative spirit. In market economy, an enterprise is an economic entity with independent operation, self-financing and independent accounting, of which economic behavior is linked closely with economic interests. Thus the ultimate goal of an enterprise is to maximize profits. At the same time, the market economy is an economy of the rule of law and the taxpayer has the obligation of paying taxes by law. In order to reduce the tax burden, an enterprise would like to find ways to pay less tax or no tax or hold over the payment. It is the economic interest that drive tax planning to emerge. Tax planning is a common economic phenomenon in western countries with relatively well-developed market mechanism.Not only investors and taxpayers compare alternative tax payment schemes before investment and operation in order to select the best tax payment scheme to maximize after-tax profits, but also legitimate tax planning has been recognized and encouraged by the government.Tax planning is still in its primary stage in China, and not subject to the attention of many taxpayers and investors. Taxation lies in the whole process of production and operation and the every aspect realization. When making production and management decisions, the enterprise may have to pay a higher price if the manager ignore the existence of the tax. Tax payment of an enterprise involves two subjects-the enterprise and the state. It is a question worth studying how to make the tax payment benefit both enterprise and the staste on the premise of complying with tax laws and regulations, which means to promote the improvement of the economic efficiency of the enterprise and to facilitate the development of national rule of law and social and economic development.In summary, the thesis will make solution planning, analysizing and selecting on the main tax items of each business links by the way of case-studying based on current tax policies and the formation mechanism of tax planning, combined with the problems faced by XX limited company and its actual operation in order to provide a reference for the enterprise managerial and operational decision-making.