In today’s rapidly developing digital economy, embedded software has become the “brain” of smart devices. To encourage the development of the software industry, the government has introduced an immediate tax refund policy for embedded software value-added tax—after paying a 13% VAT, companies can apply for a refund of the portion of the actual tax burden that exceeds 3%. This policy can directly reduce the tax burden on enterprises, but many companies miss out on benefits due to non-standard operations. This article will provide a detailed interpretation of the key points of the policy and the operational process.
1. Who can benefit? Let’s look at the “threshold”
1.Taxpayer status:Must be a general VAT taxpayer (small-scale taxpayers are not eligible).
2.Software qualifications:Must hold a “Computer Software Copyright Registration Certificate” or a “Software Product Registration Certificate.” Note: Imported software that is merely translated into Chinese does not qualify; it must be software independently developed or deeply localized by the enterprise.
3.Financial accounting:Revenue and costs for hardware and software must be accounted for separately. Mixed-operation enterprises need to establish clear accounts, for example, a smart device manufacturer must separately account for the sales of embedded software and hardware.
2. How is the tax refund amount calculated? Understand it in three steps
Step 1: Determine software sales revenue
Formula: Software sales revenue = Total sales revenue of hardware and software – Hardware sales revenue
Hardware prices are determined in the following order:
① The average selling price of similar hardware from the enterprise in recent times (preferred);
② The average selling price of similar hardware in the market;
③ If the first two cannot be determined, calculate the taxable price as hardware cost × (1 + 10%).
Step 2: Allocate output tax and input tax
Software output tax = Software sales revenue × 13%
Special input tax (e.g., software testing instruments, development software licensing fees) is directly allocated to the software portion;
Common input tax (e.g., office utilities, rent) must be allocated based on “sales revenue ratio” or “cost ratio” and filed in the tax system (once selected, it cannot be changed within a year).
Step 3: Calculate the tax refund amount
Formula: Immediate tax refund amount = Software taxable amount – Software sales revenue × 3%
Where, software taxable amount = Software output tax – Allocated software input tax.
3. Operational process
1.Policy filing (must be done before the first application):
Log in to the electronic tax bureau → Enter the “Tax Reduction Filing” module → Fill out the “Enjoy Immediate Tax Refund Policy Situation Form” → Upload the software copyright certificate.
2.Daily accounting management:
Software sales must issue separate invoices and maintain independent accounts;
In the tax system, mark the input tax related to software with the “jzt” label;
Keep records of hardware pricing basis, software and hardware cost separation tables, etc. for future reference.
3.Apply for tax refund:
VAT declaration form Appendix 1: Fill in the 6th column for immediate tax refund sales revenue, and the 11th column for output tax;
Main form: Fill in the 8-10 columns separately for immediate tax refund data;
Appendix 2: Fill in the 6th column for input tax transfer out amount.
4. Pitfall guide: Be aware of these risks
High hardware proportion: If hardware costs exceed 70% of total costs, tax authorities may question the authenticity of software value;
Credit rating: If the tax credit rating drops to level D, the qualification for immediate tax refund is automatically canceled;
Software upgrades: After version updates, re-filing is required to ensure registration information matches the latest version.
5. Document preservation: Keep a good “evidence chain”
Long-term preservation: Original software copyright certificate (permanently preserved);
At least 10 years: Software and hardware cost separation tables, bank receipts, tax payment certificates, etc.;
Available for inspection at any time: Pricing basis, allocation calculation tables, and other supporting materials.
Through this detailed interpretation, we believe you have a clearer understanding of the immediate tax refund policy for embedded software. If you encounter specific issues in actual operations, it is recommended to consult a professional tax advisor or the competent tax authority in a timely manner to ensure that the policy benefits can be safely and compliantly transformed into the driving force for enterprise development.
