[Official Q&A] Q&A on the annual final settlement of individual income tax business income after "reverse invoicing"

@"Reverse invoicing" taxpayers!

We have collected and organized hot questions and answers about the annual settlement and payment of individual income tax business income after "reverse invoicing." Come and take a look~

1. After an individual seller sells scrap products under "reverse invoicing," when should the annual reconciliation of individual income tax business income be handled?

Answer:According to the provisions of the Announcement of the State Taxation Administration on Matters Concerning "Reverse Invoicing" by Resource Recycling Enterprises to Individual Sellers of Scrap Products (Announcement No. 5 of 2024), individual sellers shall, before March 31 of the year following the "reverse invoicing," handle the annual reconciliation and settlement of individual income tax on business income themselves. For example, if an individual seller conducted "reverse invoicing" in 2024 and prepaid individual income tax on business income, they shall handle the annual reconciliation and settlement of business income themselves between January 1 and March 31, 2025.

2. After natural person sellers sell scrapped products through "reverse invoicing," through which channels can they handle the annual reconciliation and settlement of business income?

Answer:To facilitate individual sellers in handling the annual comprehensive income reconciliation, tax authorities provide both online and offline channels, and taxpayers may preferentially choose online handling. Taxpayers handling it through the online channel may log in to the Natural Person Electronic Tax Bureau website (http://etax.chinatax.gov.cn), click "I Want to Handle Taxes -- Tax and Fee Declaration -- Other Business Operation Income (Form B)" to handle it; those handling it through the offline channel may go to the tax service hall of the competent tax authority at their habitual residence.

3. What facilitation services do tax authorities provide when individual sellers file the annual reconciliation and settlement of business income?

Answer:To further facilitate individual sellers in handling the annual reconciliation of business income, tax authorities provide a pre-filling service. Basic information such as the individual seller's name, the annual "reverse invoicing" amount, and the amount of prepaid tax already handled on their behalf can be automatically pre-filled into the filing form, and the tax amount is automatically calculated, making it convenient for individual sellers to file.

4. If an individual seller, in addition to obtaining income from "reverse invoicing," also invests in an individual industrial and commercial household, a sole proprietorship enterprise, or a partnership enterprise, does he or she need to file a consolidated business income tax return?

Answer:According to the provisions of the Announcement of the State Taxation Administration on Matters Concerning "Reverse Invoicing" by Resource Recycling Enterprises to Individual Sellers of Scrap Products (Announcement No. 5 of 2024), where an individual seller, in addition to income obtained from "reverse invoicing," also invests in an individual industrial and commercial household, a sole proprietorship enterprise, or a partnership enterprise, they shall, after handling the annual reconciliation and settlement of business income with the competent tax authorities of their habitual residence and the place where the invested enterprise is located respectively, choose one of the places where the invested entity is located to handle the annual consolidated filing of business income with the competent tax authority.

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