What is the applicable tax rate for water charges charged by property management companies?

Our company is a property management company and belongs to the general taxpayer. We need to collect water charges from the residents in the community we manage and then hand them over to the water supply company. If you invoice a resident, what is the applicable tax rate and how many tax rates can you invoice?

Answer: According to the Announcement of State Taxation Administration of The People's Republic of China City, People's Republic of China (PRC) on the Value-added Tax of Tap Water Fee for Property Management Services (People's Republic of China (PRC) State Taxation Administration of The People's Republic of China Announcement No.54, 20 16), the tap water fee charged by taxpayers for providing property management services to service recipients shall be regarded as the sales after deducting the tap water fee paid by them, and the value-added tax shall be calculated and paid at the rate of 3% according to the simple taxation method.

Therefore, taxpayers who provide property management services are allowed to apply the simple tax calculation method to calculate and pay VAT. The water fee invoices issued by enterprises to households can be issued at the rate of 3% according to the simple tax calculation method.