Three ways of profit distribution in sole proprietorship enterprises;
1. Withdraw statutory surplus reserve (10%) and statutory public welfare fund (5%).
2. The profits made by the boss of a sole proprietorship company shall be subject to personal income tax. Individual income tax shall be levied on the income from the production and operation of investors according to the income from the production and operation of individual industrial and commercial households.
1. The balance of the total income after deducting costs, expenses and losses in the tax year is taxable income, and the personal income tax payable is calculated accordingly. Its calculation formula is: taxable income = total income-cost, expense and loss. Personal income tax payable = taxable income x applicable tax rate.
3. Cost refers to the indirect expenses, sales expenses, management expenses and financial expenses included in the direct cost allocation of self-employed individuals in production and operation; Loss refers to all kinds of industrial and agricultural expenditures incurred by self-employed individuals in the process of production and operation.
Characteristics of a sole proprietorship enterprise:
(1) The establishment and dissolution procedures of enterprises are simple.
(2) Flexible and free management. Business owners can determine their own business strategy and make business decisions completely according to their own will.
(3) The owner shall bear unlimited liability for the debts of the enterprise. When the assets of the enterprise are insufficient to pay off the debts, the owner pays off the debts of the enterprise with his personal property. It is beneficial to protect the interests of creditors, but wholly-owned enterprises are not suitable for high-risk industries.
(4) The scale of the enterprise is limited. The limited operating income, limited personal property, limited working energy and management level of a sole proprietorship enterprise restrict the expansion of its business scale.
(5) The existence of enterprises lacks reliability. The survival of a wholly-owned enterprise depends entirely on the personal safety of the owner, and the life span of the enterprise is limited. In the modern economic society, wholly-owned enterprises play an important role.
Extended data:
1. A sole proprietorship enterprise, also known as a sole proprietorship enterprise, is an organizational form of an enterprise. A sole proprietorship enterprise, referred to as a sole proprietorship enterprise for short, refers to a profit-making economic organization invested by a natural person and all its assets are owned by the investor. Sole proprietorship is a very old enterprise form, which is still widely used in commercial operation. Its typical characteristics are individual investment, individual management, individual self-financing and self-risk.
2. A wholly-owned enterprise refers to an enterprise invested and operated by an individual, owned and controlled by an individual, which bears operational risks and enjoys all operational benefits. An unincorporated natural person enterprise cannot bear civil liability independently. Operators must bear unlimited joint and several liability. Strictly speaking, a company refers to a profit-making legal entity established by shareholders according to law. Generally speaking, a company can bear civil liability independently, and is generally called a legal person. As a shareholder of a wholly-owned company, the concept of shareholder refers to a one-man company in a limited liability company.
3. One-man company refers to a limited liability company with only one shareholder, that is, the investor of the company is one person, and the investor is fully responsible for the debts of the company. China's newly revised company law stipulates a one-person limited liability company, and both natural persons and legal persons can contribute to set up a one-person limited liability company. In addition to one-man companies funded by natural persons and legal persons, wholly state-owned companies in China's company law also belong to one-man limited liability companies, but their shareholder status is special.
Legal basis:
Article 19 of the Law of People's Republic of China (PRC) Municipality on Wholly Owned Enterprises
Investors of a sole proprietorship enterprise may manage their own business affairs, or entrust or hire other persons with civil capacity to be responsible for the management of business affairs.
Where an investor entrusts or employs others to manage the affairs of a sole proprietorship enterprise, it shall sign a written contract with the trustee or employee, specifying the specific contents of the entrustment and the scope of the rights granted.
The trustee or employee shall, in accordance with the contract signed with the investor, fulfill the obligation of honesty and diligence and be responsible for the affairs management of the sole proprietorship enterprise.
The investor's restriction on the functions and powers of the trustee or employee shall not be against a bona fide third party.