How to avoid tax reasonably if the company's profits are too high?

If the company's profit is too high, it can reduce tax expenditure through reasonable tax avoidance, including choosing appropriate tax preferential policies and setting up compliant subsidiaries.

For the case that the company's profits are too high, some enterprises may consider reducing tax expenditure through preferential tax policies. Among them, the most common method is to transfer some profits to subsidiaries with weak profitability or in different regions, and the taxes paid by subsidiaries will be lower. This method requires enterprises to operate in compliance with relevant tax laws and regulations, otherwise they may face risks such as tax punishment and loss of corporate reputation. In addition, there are some preferential tax policies, which can comply with tax avoidance according to relevant national laws and regulations. For example, qualified high-tech enterprises can enjoy preferential policies such as halving corporate income tax; Enterprises engaged in research and development or scientific and technological services may also apply for corresponding preferential tax policies according to actual conditions.

Can enterprises enjoy preferential tax policies to reduce taxes and fees if their profits are too low? Not necessarily. Although in some cases, low-profit enterprises can also enjoy preferential tax policies according to the actual situation, they need to be judged and applied according to the specific situation. As for the reasons for the low profits of enterprises, it may be related to many factors such as business conditions and market competition, which need to be analyzed and solved from multiple angles.

For the problem of high profits of the company, reasonable tax avoidance measures can be taken to reduce tax expenditures, but attention should be paid to operational compliance and compliance with relevant tax laws and regulations. At the same time, preferential tax policies are also an important tax reduction measure, which can play a more active role in promoting the allocation of resources for qualified enterprises.

Legal basis:

Article 6 of the Enterprise Income Tax Law of People's Republic of China (PRC), enterprises, other organizations and individuals in People's Republic of China (PRC) shall pay enterprise income tax on their income obtained in various forms.