Research On The Qualitative Problem Of Taxable Income In Cross-border Software Transactions

With the vigorous development of Internet technology,all kinds of new business models and transaction methods have emerged in the world.Under the background of the uneven development level of information technology in the world,software,as an inevitable product of the development of information technology,plays a very important role in international trade.Software transaction is different from the traditional goods transaction,which is mainly reflected in the comprehensiveness and intangibility of the transaction.Firstly,the comprehensiveness of cross-border software transactions is reflected in three aspects: the diversification of trading objects,the integration of trading methods and the diversification of trading protection methods;Secondly,software is a collection of a series of programs,documents and data.Different from ordinary goods,the characteristics of software replicas are more reflected in their intangibility.In addition to software replicas,the objects of cross-border software transactions also include software copyright,patent right and other intellectual property rights.As a typical intangible asset,intellectual property rights are also intangible.However,the increasing volume of cross-border software transactions has also brought more international tax problems,of which the more prominent is the qualitative problem of taxable income of cross-border software transactions,which is mainly reflected in the difficulty in distinguishing between royalties and sales revenue of software transactions.Firstly,this paper introduces the characteristics and types of software cross-border transactions,and puts forward the qualitative problem of taxable income in software cross-border transactions;Secondly,it expounds the qualitative standards of taxable income of cross-border software transactions in China from two aspects of domestic regulations and tax treaties,and analyzes the problems existing in the rules from two aspects of institutional framework and qualitative standards;Then,it lists,summarizes and analyzes the relevant provisions and precedents of international organizations and typical countries.Finally,it puts forward plenty of suggestions on the improvement of software income qualitative standard in China from the perspective of basic principles,institutional framework and specific standards.The article points out that the scope of royalties in software transactions is closely related to the international status of various countries in the field of information technology.Different countries are on the different levels of technological development,so they have different tendencies in formulating tax policies.But at the same time,the principle of judging the nature of income according to the essence of transaction rather than the form of transaction has gradually become the international development trend in the future.This paper holds that China should classify the transaction income according to the standard of "the nature of the rights transferred by the exchange".When determining the taxable income of cross-border software transactions,we should follow the principle of transaction essence over transaction form,tax neutrality and the principle of balancing the purpose of copyright protection and tax purpose;When constructing the relevant institutional framework,we should revise relevant domestic laws and regulations,improve the working text of tax treaty negotiation and formulate text notes on the basis of ensuring the integrity,effectiveness,systematicness and consistency of the institutional framework;In terms of specific standards,it is clear that only the "payment for the use or right to use the copyright and patent of the software" can be recognized as royalties,excluding the "payment for the use or right to use the software products".In terms of the tax classification of specific transactions,the transaction form should be omitted and the object and purpose of the transaction should be paid attention to when characterizing software cross-border payments.