Individual industrial and commercial households, sole proprietorship enterprises and partnership enterprises only pay individual income tax, while limited liability companies and joint stock limited companies are legal entities, which have to pay enterprise income tax, and then pay individual income tax on the income that individuals share from the company.

In addition, individual industrial and commercial households are the product of private ownership of small traders and hawkers under the planned economy, which is very distinctive in China, and corporate enterprise is an international term.

In addition, the accounting system of individual industrial and commercial households is generally imperfect, and tax authorities mostly adopt the method of verification and collection, while limited liability companies and joint-stock enterprises generally use the method of audit and collection to pay taxes.

Obviously, to be bigger and stronger, it is still necessary to be a company system, and individual industrial and commercial households are generally tinkering around the edges. What kind of organizational system to register depends on many factors. Of course, the tax expenditure in the operation process is a very important aspect.