Recently, Huatax has received inquiries from pharmaceutical enterprises in Hunan and Jiangxi, etc. The same real controller registers and establishes one or more CSO companies to issue invoices for consulting service fees, promotion fees, etc. to pharmaceutical enterprises, and the one or more CSO companies then set up dozens of sole proprietorships by using the identities of their employees and relatives to be nested in the invoicing process. The individual sole proprietor issues invoices to the CSO company or the designated pharmaceutical enterprise through the pharmaceutical digital marketing platform or other platforms with the qualification of entrusted levy, and cancels the old account and establishes a new account after the quota is full. Under the above business model, the authenticity of consulting services and the reasonableness of pricing have become the focus of dispute between tax enterprises, and improper handling may lead to the risk of administrative and criminal liability for tax evasion and false invoicing.

I. Case introduction: the original provincial representative registered, controlled more than 40 individual solo or one person CSO, and allocated invoicing amount according to the demand of pharmaceutical enterprises

Company A is a pharmaceutical distribution enterprise, which originally had the qualification of provincial agent or exclusive agent for several drugs in the province. After the implementation of the two-invoice system, the real controller has registered and established more than 40 individual sole proprietorships or 1-person CSO consulting service companies using the identification of the company's employees or relatives, with the registered place of business located in the parks of various cities. Among them, only 1 company name has employee labor wages and other costs and expenses charged, with complete financial accounts accounting. The rest of the one-person sole proprietorships have no actual operation, no staff labor and other costs and expenses listed under their names, and the amount and type of invoicing (consulting service fees, promotion fees, conference fees, and publicity fees) of the individual sole proprietorships are designated by the company in control according to the actual sales of pharmaceutical products. The consulting service fees paid by the pharmaceutical company ultimately flow to Company A's former medical representatives through the sole proprietor.

II. Analysis of the Risk of Suspected False Invoicing in the Mode of Invoicing of Individual Sole Proprietorship→CSO Company→Pharmaceutical Enterprises

Individual sole proprietorship enterprises are not enterprises under the Enterprise Income Tax Law, and are not required to pay enterprise income tax according to law, and are required to pay value-added tax, surtaxes and fees as well as personal income tax in accordance with operating income. In order to drive the local economic development and attract investment in the name of headquarter economy, each region implements authorized levy on individual sole proprietorships established in local tax parks, and the comprehensive tax burden is extremely low. After the implementation of the two-invoice system, some pharmaceutical representatives issued invoices for pharmaceutical companies or for large pharmaceutical consulting companies under their names by setting up sole proprietorships in the parks. Under the above business model, whether the sole proprietorship enterprise has truly provided the services and whether the pricing of the services is reasonable have become the focus of dispute between the tax enterprises.

(I) Whether the sole-proprietor enterprise has actual operation

Common risk points:

Sole proprietorship enterprises have no actual business premises and no actual office staff; CSPs set up multiple individual sole proprietorships, with individual sole proprietorships being the same actual controller; individual sole proprietorships have frequent cancellations, top-quantity invoicing, escaping and losing contact after invoicing; there is no trace of an office, and there are only 1-2 people responsible for keeping the seals, issuing and accepting invoices, receiving bank statements, dealing with cancellations, and keeping the seals, and the registered legal representative is not an actual business person at all, and is unaware of the opening of the The company is unaware of the fact that it is registered and set up for others with fraudulent ID cards.

Inspection Methods:

Field inspection of office space, require proof of office space own real estate or rental service contract; field verification of whether there are office staff, require proof of payment of wages and health insurance social security payment certificate; individual sole proprietor, CSP company registered legal representative is clear about the relevant business, whether it is the same de facto controller of the shell company set up in vain.

(II) Whether the sole proprietor actually provides pharmaceutical consulting services

Common risk points:

(1) The service contract is a template downloaded from the Internet, and the pharmaceutical company does not track the content of the contract.

(2) The "service fee" is agreed in an unusual manner and is linked to the quantity of drugs sold.

(3) Some consulting service contracts are signed even earlier than the establishment of the individual.

(4) Pharmaceutical companies do not verify the authenticity of the services, and pharmaceutical companies do not conduct any form of acceptance of specific services, but only require the CSP company to provide the appropriate information.

Inspection method:

Require CSP and individual solo companies to explain what specific consulting services, conference services, marketing services, advertising services provided to pharmaceutical companies; the specific business processes to carry out the above services, the actual business person in charge of each process, including the person in charge of the identity card number, contact information, and the way of serving in the company.

(III) tracking the flow of funds to lock the establishment of a sole essence of "false invoicing to withdraw cash".

Common risk points:

Individual business account false, no actual operating funds flow; pharmaceutical factories → pharmaceutical consulting services company → individual → doctors of the flow of funds; individual registered in most of the park enterprises, to enjoy the financial rebates or approved levy policy benefits

Inspection methods:

Account flow of the opening bank account, associated personal bank account flow

Trace the flow of funds from the pharmaceutical factory, calculate the funds corresponding to the invoices in each transaction based on the invoices, and project the "invoicing fees".

Concern: In the above transaction mode, there is no "return flow of funds", but the tax authorities may still be based on the second step to determine that there are no real goods transactions and the calculation of funds in each link, and determine that the service transactions in each link are fictitious, and the purpose is to continue to "launder money through invoices" for the pharmaceutical factory after the implementation of the two-invoice system. ".

III. the risk of false invoicing and tax evasion by individual and CSO companies will be transferred to pharmaceutical enterprises.

The above individual invoicing business model, the final invoice flow to the pharmaceutical companies, and even part of the business model, the final funds "back" to the pharmaceutical companies employees, family members, agents account. The Ministry of Finance previously 77 pharmaceutical enterprises after random checks issued by the Ministry of Finance on the 19 pharmaceutical enterprises administrative penalties, including Sanofi (Beijing), Changbaishan Pharmaceutical, Jiangsu Hengrui, Shandong Buchang, Shenzhen China Resources Sanjiu and other 17 enterprises, in the listed investigation and handling of the problem, the false listing of consulting service fees, meeting fees, false increase in the phenomenon of business promotion costs are more prevalent, and the majority of invoices from the acquisition of pharmaceutical consulting service companies, easy to receive false invoices from consulting service companies. Most of the invoices are obtained from pharmaceutical consulting service companies, which are prone to receive the risk of false invoicing by consulting service companies, and the amount involved in some of the enterprises is extremely high:

(I) false listing of information consulting service fees, inflated business promotion fees suspected of false opening, tax evasion

(1) The invoices attached to the listed business promotion fees are false invoices;

(2) The huge amount paid to the consulting company in the name of business promotion fee, the other party deducted taxes back to the pharmaceutical company employees, employees' families, agents personal accounts;

(3) Only funds were paid, with no other information proving the true occurrence of the expenditures;

(4) Payment of sales promotion fees to individual agents, invoices issued by third-party companies that have no substantive business dealings with the company (involving an amount of over one hundred million dollars);

(5) Inaccurate research and consulting expenses charged to business promotion fees, with plagiarized research reports, consulting contracts signed earlier than the date of establishment of the consulting company, inconsistency between the content of the research and the contractual agreement; and identical research reports in different regions.

(II) Inaccurate meeting expenses, inflated sales expenses, and suspected tax evasion in lieu of bills.

1. Unrealistic meeting expenses:

(1) Some of the invitations to academic conferences do not have specific participants, information on transportation and accommodation arrangements and detailed agenda information;

(2) The listed conference address is invalid;

(3) The conference sign-in sheet without real name signature;

(4) After extended interviews with some of the participants, the relevant doctors indicated that the meeting was inaccurate or did not attend the meeting;

(5) The photos of the promotional meeting were identical, the location of the meeting was forged, the sign-in sheet was forged, and the record of the meeting held at different locations at the same time was for the same person; the photos of different meetings were the same, the sign-in sheet was the same; and the sign-in sheet of some meetings was blank.

2. False listing of sales expenses:

False increase of personnel salary, overstating the number of days of business trip of sales personnel, overstating the number of business promotion personnel, overstating the workload of labor dispatching personnel in the way of false increase of sales expenses, business trip and labor dispatching expenses;

3. Charging sales expenses with false substitute tickets:

Reimbursement of expert lecture fees, review fees and hosting fees by air tickets not incurred by the Company; reimbursement of sales staff for gifts to customers, meals for academic activities, etc., by bridge and road tolls not incurred by the organization; and travel expenses by gasoline invoices without being able to provide the recharge card number.

In the above disclosure issues, no evidentiary information to support the true occurrence of consulting services, funds flow back to the pharmaceutical enterprise, a third party invoicing and other circumstances may trigger false VAT invoices criminal liability; false VAT invoices, gasoline invoices, and other false charges for sales expenses, suspected of false invoicing criminal liability; at the same time, the pharmaceutical enterprise to obtain the false invoices shall not be used as a pre-tax deduction vouchers, and synchronization is facing the risk of administrative liability for tax evasion. The same time, pharmaceutical enterprises obtaining false invoices shall not be used as pre-tax deduction vouchers and face the risk of being recognized as administrative liability for tax evasion.

IV. commissioned on behalf of the levy platform, digital marketing platform on behalf of invoicing can not of course block the criminal risk.

With the successive characterization of pharmaceutical consulting services companies as "money laundering", pharmaceutical consulting services companies suspected of fraudulent opening, tax evasion increasingly severe investigation and punishment, began to have more and more pharmaceutical digital service trading platform, invoicing platform (signed with the tax authorities entrusted to levy the agreement) appeared. The medical business cooperation platform integrates the resources of "pharmaceutical agents" and hospitals, contacts pharmaceutical manufacturers and suppliers to join the platform, and the services of academic visits and academic meetings of pharmaceutical representatives can be presented on the platform in a scenario-based manner, supplemented by the punching records of pharmaceutical representatives and scenario-based photos of academic meetings to prove the authenticity of the services; the pharmaceutical promotion costs of pharmaceutical enterprises are paid through the platform, and the pharmaceutical consulting services are paid for through the platform. Through the platform to complete the payment, the pharmaceutical consulting service platform to a certain extent to solve the problem of pharmaceutical enterprises expense expense, but with the Bugle Technology labor platform storm, through the Internet platform to open, subject to the invoice of the tax-related risk, the enterprise should also be strictly guarded and strictly controlled.

First of all, the core of the medical business cooperation platform is to establish the connection between the opening and invoiced parties, the platform for the authenticity of the pharmaceutical consulting services can not do substantive monitoring, once confirmed that the opening and invoiced parties collusion, no business substance is suspected of false invoicing, then the platform itself is facing the risk of false invoicing.

Secondly, the outbreak of the use of financial rebate policy in various regions of the invoicing platform false opening cases, can also be seen, the invoicing side to various regions, various industries invoicing, and even across multiple provinces and cities, multiple industries invoicing, once the invoicing side of the mine, even if the invoiced party has a real business on behalf of the invoicing, it is difficult to avoid being "a net of all" to pursue the risk of false openings of criminal liability. Pharmaceutical consulting services platform is also facing the same dilemma, because the service platform for the national investment, the realization of the pharmaceutical enterprises, hospitals, doctors, pharmaceutical agent of the national resource allocation, once a business chain is investigated and dealt with characterization of false invoicing, through the platform of the invoice issued by the other regions, other enterprises, the business is also facing the same risk of being investigated.

V. pharmaceutical enterprises should properly prevent and respond to tax-related risks

(I) Retroactive business to obtain compliant invoices or corresponding evidence again

According to the Measures for the Administration of Vouchers for Pre-tax Deduction of Enterprise Income Tax, enterprises shall request the other party to change the compliant invoices if they obtain non-compliant invoices and the expenditure is real and has actually occurred. If the other party is unable to exchange invoices due to special reasons such as cancellation, revocation, revocation of business license according to law, or being recognized by the tax authorities as a non-normal household, the enterprise can collect supporting materials for the authenticity of the expenditures, such as the other party's industrial and commercial cancellation, revocation of organization, inclusion in the list of non-normal business households, bankruptcy announcements, and other supporting materials, the contract or agreement of the relevant business activities, and the payment vouchers paid by means of non-cash payment, etc., which can be used for the deduction.

Before the tax authorities start the audit program, pharmaceutical enterprises should launch tax self-examination based on existing clues, for non-compliant invoices should be traced back to the business process, and require the other party to change the compliant invoices, and if it is not possible to get the other party to change the invoices, the authenticity of the expenditures should be prepared in accordance with the provisions of the materials to prove the authenticity of the expenditures.

(II) Standardize the audit and management of invoices and various types of vouchers

For enterprises in the medical industry, the most important thing that needs to be solved under the two-invoice system is the compliance management of sales expenses, which should be transformed from solving the compliance of sales expenses through false invoicing to regulating the invoice management and voucher management of enterprises through compliant marketing, so as to control the risk of false invoicing.

The Ministry of Finance announced 17 pharmaceutical enterprises as an example of the Ministry of Finance, the investigation and punishment of meeting fees, research costs, such as lying inaccurate, if the financial reimbursement system in the day-to-day rigorous audit, the links between the departments of the articulation of the rights and responsibilities are clear, it will be able to detect the above risks. Enterprise financial personnel to strengthen the collection and management of relevant vouchers. In short, all sales costs for enterprises must first follow the principle of authenticity, which is not only the need for internal risk control, but also tax audits, public security investigation departments to verify whether the consulting services are the key to the true occurrence of the principle of authenticity under the guidance of the occurrence of costs must pay attention to the preservation of relevant evidence and materials, and effectively reduce the risk of false openings.

(III) To be transferred to the public security to pursue criminal liability for false invoicing, the defense strategy should be properly applied.

For the cases of suspected false invoicing of 100 ordinary VAT invoices or the amount of over 400,000 RMB, or the tax amount of over 50,000 RMB of false VAT invoices, the tax authorities will follow the principle of criminal priority to transfer the cases to the public security authorities for pursuing the criminal liability of false invoicing/ VAT invoices. Once the case is referred, the administrative authorities cannot intervene in the handling of the case by the judicial department, and the enterprise cannot resolve the crisis by paying back taxes, late fees and fines.

At this stage, the choice of defense strategy is particularly important, which is related to whether the enterprise is guilty or not guilty, and whether the crime is more serious or less serious. In this process, enterprises should pay attention to the following: firstly, no matter the false opening of ordinary VAT invoices or special invoices, to constitute a crime, there should be a subjective intent and cause the loss of national tax results, only the existence of false opening behavior can not be determined to constitute a crime; secondly, the enterprise accounting personnel, supervisors of the false invoicing situation is known, if out of the trust of the staff, the drug agent, or careless and did not strictly perform the invoice audit Duties and lead to the acceptance of fraudulent invoices should not be recognized as a crime, in other words, knowing that the acceptance of fraudulent invoices and even participate in fraudulent invoices can be recognized as the existence of subjective intent; third, to accurately classify the main body of the responsibility of the employees or drug agents for personal gain and intentionally provide fraudulent invoices should be investigated for the relevant individual's legal responsibility should not be recognized as the implementation of the unit of the crime.

(IV) consulting services really happen, on behalf of invoicing or invoicing is not standardized, active defense

We are concerned that there are still some cases in which pharmaceutical enterprises pay sales promotion expenses to individuals, and invoices are issued by a third party that is not affiliated with the pharmaceutical enterprise. Under this business model, there are real consulting services incurred by the enterprise, which should not be recognized as false invoicing. Although the judicial organs around the judicial decision on whether the truthful invoicing is false invoicing is not the same, but there have been more and more truthful invoicing behavior, the Public Prosecution Office to make a non-prosecution case. In the following two cases, the enterprises had real purchases and sales of goods and obtained invoices issued by the third party, and the public prosecution authorities recognized the above facts, and made a decision not to prosecute the enterprises in combination with the constituent elements of subjective intent that the crime of false invoicing of value-added tax special purpose invoices should be recognized as a false invoicing crime.

Case 1: there are real goods transactions let others truthfully on behalf of the opening, can not be confirmed that the perpetrator subjectively have the purpose of tax fraud, does not meet the prosecution conditions

Basic Case: The investigating authorities alleged that Du Moumou, during the operation of a pharmaceutical company (registered in Xingan County, Jiangxi Province), without real goods transactions, was introduced by Yu Moumou (a Guangdong native), and obtained 281 fraudulently issued VAT invoices from six companies in Suqian, Jiangsu Province (under the control of the same beneficial owner), with a total of 30.3 million yuan of value-added tax (VAT) and more than 4.4 million yuan of tax (VAT), for a commission of 4.2% - 4.5% on the face value of the invoices. More than 4.4 million yuan.

Reason for not prosecuting: according to the existing evidence can confirm that the non-prosecuted person Du Moumou in the control of the operation of the pharmaceutical company during the existence of real goods transactions, but accepting other people's false VAT special invoices 281 used to offset tax, the tax amount of 4,403,868.73 yuan, and the tax involved in the case has been in 2017 to make up for the payment of the tax, but it can not be proved by non-prosecution Du Cheng'er Du Moumou subjectively have the purpose of cheating the tax, does not meet prosecution conditions.

Case 2: "false" invoices offset the real goods without tickets business, that the false facts are not clear, insufficient evidence, does not meet the prosecution conditions

Basic case: a pharmaceutical technology company (registered in Changsha, Hunan Province), in order to reduce the company's operating costs, with 8.5% of the invoiced amount from Li operated by three Shenzhen-based technology companies to obtain 73 false invoices, the total price and tax 7.16 million, the tax amount of 1.21 million. According to the confession and the relevant evidence to identify: some of the invoices issued above have real goods transactions; some for offsetting the company's other non-invoiced goods and false invoicing.

It was also ascertained that, in the absence of actual transactions, the non-prosecuted person purchased 68 VAT invoices from a pharmaceutical technology company in Guangzhou at a handling fee of 8% of the face amount, with a total price and tax of 7.91 million and a tax amount of 1.15 million. The non-prosecuted person arranged the company personnel to falsify the bill of entry, and used the false bill of entry to make accounts in violation of the law, and the public account only paid the handling fee of 8% of the face amount of the invoices of about 633,210 yuan, and there was no other bank current transaction.

Reasons for non-prosecution: After review and return for supplementary investigation, it was still considered that the Kaifu Branch of the Changsha Municipal Public Security Bureau had determined that the facts were unclear, the evidence was insufficient, and the conditions for prosecution were not met.

VI. Summary

In the final analysis, if the occurrence of consulting services really exists, then whether through the platform invoicing, or directly subject to invoicing, the enterprise has the rights and interests of pre-tax expenses and input tax credits, tax enterprises and the two sides around the authenticity of the consulting services, the core of the dispute focuses on: ① how to measure the value of the service, the tax office that the pharmaceutical companies pay consulting service fee is significantly higher than the market value, then how to assess the market value? ② how to prove the authenticity of the service, consulting services occur to retain what information to prove? ③ After the invoice issued by the pharmaceutical consulting services company, pharmaceutical companies to pay over the funds, how to ensure that the final flow of payment in line with the essence of the business occurrence? Pharmaceutical companies, hospitals and other stakeholders should ultimately see the big picture, is still to promote medical business cooperation compliance. The compliance model is centered on the full-process management of prior announcement, supervision and filing, and the activities of academic conferences, academic collaboration and drug promotion and explanation will be realized to realize the full-process traceability and evidence of the activities, so as to carry out the doctor-business interactions under the premise of compliance and lawfulness.