Fixed assets, intangible assets, and real estate purchased by enterprises often serve more than one purpose. A piece of equipment may be used to produce both taxable and tax-exempt products; a building may be used for the company\u2019s own office space, while part of it serves as employee housing.<\/p>\n
In the past, there were inconsistent interpretations regarding whether the input tax on such \u201cmixed-use\u201d long-term assets could be fully deducted. Following the implementation of the *Regulations for the Implementation of the Value-Added Tax Law* on January 1, 2026, Article 25 provides clear rules on this matter.<\/p>\n
The regulations classify mixed-use long-term assets according toOriginal Cost of an Individual Asset<\/strong>These are handled in two ways:<\/p>\n The \u201cfive categories of items not eligible for tax credits\u201d referred to here are: items taxed under the simplified tax calculation method, VAT-exempt items, non-taxable transactions not eligible for tax credits, collective welfare benefits, and personal consumption.<\/p>\n The significance of the 5 million yuan threshold lies in:For the vast majority of small and medium-sized enterprises, individual items of equipment, vehicles, and software all fall within the full deduction range.<\/strong><\/p>\n In the past, to play it safe, many companies adopted a conservative approach of allocating deductions for mixed-use assets based on sales proportions, thereby voluntarily forfeiting a portion of their deduction entitlements. Now that the new regulations have been clarified, companies can confidently claim the full deduction for such assets, effectively freeing up a significant amount of cash flow.<\/p>\n For individual assets valued at more than 5 million yuan, the non-deductible portion must be calculated annually based on the adjustment period. The real challenge isn\u2019t the calculation itself, but ratherChain of Evidence<\/strong>::<\/p>\n For companies that own factory buildings, large-scale production lines, and office buildings for their own use, this requirement involves a significant amount of work; we recommend establishing the relevant records by the end of 2026.<\/p>\n Boundary 1: Distinguishing Between Fixed Assets and Inventory.<\/strong> The regulations provide a clear definition of \u201cfixed assets\u201d\u2014machinery, equipment, and vehicles with a useful life exceeding 12 months, as well as other equipment, tools, and implements related to production and operations. Low-value consumables are not included in this definition.<\/p>\n Threshold 2: 5 million yuan refers to the original value of a single item, not the annual total.<\/strong> Multiple small-value assets cannot be combined for calculation purposes.<\/p>\n Boundary 3: Determination of Mixed-Use Status.<\/strong> This applies only when an asset is indeed used for both purposes simultaneously; if the asset\u2019s use changes entirely, it falls under a different set of accounting rules.<\/p>\n If you\u2019re verifying that your materials align with the reporting guidelines, feel free to contact a consultant at Qicaiying (WeChat\/Phone: 18676749275), and we\u2019ll walk you through the entire process from start to finish.<\/p>","protected":false},"excerpt":{"rendered":" \u300a\u589e\u503c\u7a0e\u6cd5\u5b9e\u65bd\u6761\u4f8b\u300b\u7b2c\u4e8c\u5341\u4e94\u6761\u5bf9\u65e2\u7528\u4e8e\u5e94\u7a0e\u9879\u76ee\u3001\u53c8\u7528\u4e8e\u7b80\u6613\u8ba1\u7a0e\u3001\u514d\u7a0e\u3001\u96c6\u4f53\u798f\u5229\u7b49\u4e94\u7c7b\u4e0d\u5141\u8bb8\u62b5\u6263\u9879\u76ee\u7684\u957f\u671f\u8d44\u4ea7\uff0c\u786e\u7acb\u4e86\u4ee5\u539f\u503c500\u4e07\u5143\u4e3a\u5206\u754c\u7684\u5dee\u5f02\u5316\u5904\u7406\u89c4\u5219\u3002\u672c\u6587\u8bf4\u660e500\u4e07\u5143\u4ee5\u4e0b\u5982\u4f55\u5168\u989d\u62b5\u6263\u3001\u8d85\u8fc7500\u4e07\u5143\u5982\u4f55\u9010\u5e74\u8c03\u6574\uff0c\u4ee5\u53ca\u4f01\u4e1a\u9700\u8981\u6ce8\u610f\u7684\u53f0\u8d26\u4e0e\u5907\u67e5\u8981\u6c42\u3002<\/p>","protected":false},"author":10,"featured_media":18260,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13,17,18,64],"tags":[2352,2353,2354,2355],"class_list":["post-18261","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-guide","category-allguide","category-recomguide","category-gf-tax-compliance","tag-2352","tag-2353","tag-2354","tag-2355"],"yoast_head":"\n\n
This is a real boon for small businesses.<\/h2>\n
The challenge in adjusting major assets year by year lies in the ledgers<\/h2>\n
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A Few Boundaries That Are Easily Confused<\/h2>\n
Landing Moves<\/h2>\n
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