Research On Land Appreciation Tax Planning Of Real Estate Development Companies

Taxes on the real estate industry have long been an important part of local fiscal revenue and Land Appreciation Tax one of the major tax burdens of real estate companies. In order to boost the sound development of real estate industry and collect more fiscal revenue to meet the growing public expenditure, the industry is faced with increasingly stricter implementation issues concerning Land Appreciation Tax settlement.Real estate sector is faced with both opportunities and challenges presented by the New Normal after the whole community experienced slower investment growth, high housing stock,dwindling housing price and salient market fragmentation. Land Appreciation Tax settlement is now an inevitable task for companies in the industry since they are now gradually required to pay Land Appreciation Tax for many of their large-scale development projects in the past. Against the foregoing background, this thesis studies the Land Appreciation Tax planning of real estate development enterprises with the case study of Star Real Estate Co., Ltd. and analysis of related policies.The first part presents research literature on the background and significance of the imposition of Land Appreciation Tax at both home and abroad and naturally carries out analyses in this regard.The second part introduces policies bearing on Land Appreciation Tax. The thesis first introduces the development and tax-related issues of the real estate sector and then studies corporate Land Appreciation Tax burdens. Finally, in-depth analyses of the tax and its burden rate as well as elaboration of basic regulations, settlement policies and available tax incentives in this regard are performed.The third part is case analysis, in which conditions of Star Real Estate Co., Ltd. and its projects, its self-produced tax settlement outcomes and settlement results with the audit of tax authorities and confirmation of the enterprise, as well as differences of Land Appreciation Tax burdens between the corporation and other listed enterprises in the industry are shown.The forth part examines the case in details with study of corporate income and tax deductions,revealing problems and difficulties commonly seen in Land Appreciation Tax settlement and briefly introducing emphases in this respect.The fifth part provides enlightenment from the case study and proposes Land Appreciation Tax planning measures that should be taken including a foresighted grasp of the expected goals of policies, adherence to principles concerning Land Appreciation Tax planning and adoption ofscientific tax planning methods so that the objective in the regard can be attained.To sum up, the thesis offers suggestions for real estate development companies on how to record their earnings and costs in line with existing laws and regulations as well as policies concerning Land Appreciation Tax settlement so that these corporations are able to take advantage of key factors in tax planning. By doing so, the author hopes to help them save tax costs legally,minimize legal risks in tax planning, safeguard their rights and interests and at the same time pay taxes according to law by promoting reasonable use of Land Appreciation Tax planning methods.