On 13th of Nov, 2019, the State Taxation Administration released an Announcement on Matters Related to Tax Credit Repair, to be effective from January 1, 2020.
According to the announcement, entity taxpayers may apply to the competent tax authorities for tax credit repair within the prescribed time limit if they satisfy one of the following conditions:
(1) They have handled the tax declaration, tax payment and data filing, after failing to do so, in accordance with the statutory time limit, or
(2) For those who failed to pay tax in full, or pay overdue fine as demanded by the tax authorities however, whose behavior is not serious enough to constitute a crime, (hence they were directly considered as a D-level credit taxpayer), if they have paid or made up all tax payable within 60 days upon the final decision made by competent tax authorities.
(3) The taxpayer fulfills the corresponding legal obligations and the tax authorities lift the abnormal household status according to law.
According to the announcement, the prescribed deadline should be the end of next year when the taxpayer is put in the record by the tax authorities. The tax authority will adjust the status of the taxpayer’s credit evaluation index according to the correction of their behavior, and re-evaluate the tax credit level of the taxpayer, but may not evaluate it as A-grade.
Meanwhile, the announcement stipulates that the tax credit repair can only be applied once in a tax year.
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