What do you mean by pre-tax expenses?

Pre-tax expenses are expenses that can be deducted from pre-tax profits. Due to some differences between accounting law and tax law, accounting treatment and tax treatment have different calibers for determining the income and expenses of enterprises. Pre-tax expenses include office expenses, lawyer's fees, business entertainment expenses, transportation expenses, travel expenses, advertising expenses, depreciation expenses, welfare expenses, wages, telephone charges, social security fees, utilities, consulting fees, freight, rental fees, insurance premiums, donations, financial expenses, taxes and fees, decoration fees, etc.

Individual Income Tax Law of the People's Republic of China

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The following personal income shall be subject to personal income tax:

(1) Income from wages and salaries;

(2) Income from remuneration for labor services;

(3) Income from remuneration;

(4) Income from royalties;

(5) Operating income;

(6) Income from interest, dividends and bonuses;

(7) Income from property lease;

(8) Income from property transfer;

(9) Accidental income.

Individual residents who obtain income from items 1 to 4 of the preceding paragraph (hereinafter referred to as comprehensive income) shall calculate individual income tax according to the tax year; Non-resident individuals who obtain income from items 1 to 4 of the preceding paragraph shall calculate individual income tax on a monthly or itemized basis. Taxpayers who obtain income from items 5 to 9 of the preceding paragraph shall calculate individual income tax separately in accordance with the provisions of this law.