Section 3 Deductions
Article 27 The relevant expenditures mentioned in Article 8 of the Enterprise Income Tax Law refer to expenditures directly related to the acquisition of income.
The term “reasonable expenditures” as mentioned in Article 8 of the Enterprise Income Tax Law refers to necessary and normal expenditures that are in compliance with the routine of production and business activities and should be included in the profits and losses of the current period or the cost of relevant assets.
Article 28 The expenditures incurred by an enterprise shall be distinguished between revenue expenditures and capital expenditures. Revenue expenditures shall be directly deducted in the current period in which they are incurred; capital expenditures shall be deducted in installments or included in the cost of relevant assets and shall not be directly deducted in the current period in which they are incurred.
Expenses or property generated when an enterprise’s non-taxable income is used for expenditures shall not be deducted or calculated for corresponding depreciation and amortization deductions.
Except as otherwise provided by the Enterprise Income Tax Law and these Regulations, the actual costs, expenses, taxes, losses and other expenditures incurred by the enterprise shall not be deducted repeatedly.
Article 29 The costs mentioned in Article 8 of the Enterprise Income Tax Law refer to the cost of sales, cost of goods sold, business expenses and other expenses incurred by the enterprise in its production and operation activities.
Article 30 The expenses mentioned in Article 8 of the Enterprise Income Tax Law refer to the sales expenses, management expenses and financial expenses incurred by the enterprise in the production and operation activities, except for relevant expenses that have been included in the cost.
Article 31 The taxes mentioned in Article 8 of the Enterprise Income Tax Law refer to various taxes and surcharges incurred by the enterprise except enterprise income tax and value-added tax that are allowed to be deducted.
Article 32 The losses referred to in Article 8 of the Enterprise Income Tax Law refer to losses from inventory losses, damage and scrapping of fixed assets and inventories, losses from transfer of property, and bad debts that occur during the production and operation activities of the enterprise. losses, bad debt losses, losses caused by force majeure factors such as natural disasters and other losses.
For losses incurred by an enterprise, the balance after deducting compensation from the responsible person and insurance claims shall be deducted in accordance with the regulations of the financial and taxation authorities of the State Council.
When an enterprise's assets that have been treated as losses are fully recovered or partially recovered in subsequent tax years, they shall be included in the current income.
Article 33 The term “other expenditures” as mentioned in Article 8 of the Enterprise Income Tax Law refers to, in addition to costs, expenses, taxes and losses, expenses related to production and business activities incurred by an enterprise in its production and business activities. Reasonable expenses.
Article 34: Reasonable wages and salary expenses incurred by the enterprise shall be deducted.
The wages and salaries mentioned in the preceding paragraph refer to all cash or non-cash labor remuneration paid by an enterprise to employees who serve or are employed by the enterprise in each tax year, including basic wages, bonuses, Allowances, subsidies, year-end salary increases, overtime wages, and other expenses related to the employee's appointment or employment.
Article 35 Enterprises shall pay basic pension insurance premiums, basic medical insurance premiums, unemployment insurance premiums, work-related injury insurance premiums, Basic social insurance premiums such as maternity insurance premiums and housing provident funds are allowed to be deducted.
Supplementary pension insurance premiums and supplementary medical insurance premiums paid by enterprises for investors or employees are allowed to be deducted within the scope and standards prescribed by the financial and taxation authorities of the State Council.
Article 36 In addition to the personal safety insurance premiums paid by enterprises in accordance with relevant national regulations for employees in special types of work and other commercial insurance premiums that can be deducted as prescribed by the financial and taxation authorities of the State Council, enterprises that are investors or Commercial insurance premiums paid by employees shall not be deducted.
Article 37 Reasonable borrowing costs incurred by an enterprise in its production and operation activities that do not require capitalization are allowed to be deducted.
If an enterprise borrows money for the purchase and construction of fixed assets, intangible assets and inventories that require more than 12 months of construction to reach the intended salable state, the reasonable borrowing costs incurred during the purchase and construction period of the relevant assets , shall be included in the cost of relevant assets as capital expenditures and deducted in accordance with the provisions of these Regulations.
Article 38 The following interest expenses incurred by enterprises in the production and operation activities are allowed to be deducted:
(1) Interest expenses of non-financial enterprises borrowing from financial enterprises, financial enterprises Various deposit interest expenses and inter-bank lending interest expenses, and interest expenses on bonds issued by enterprises after approval;
(2) The interest expenses of non-financial enterprises borrowing from non-financial enterprises shall not exceed the same period as that of financial enterprises in the same period. The portion of the amount on which the loan interest rate is calculated.
Article 39 Exchange losses incurred by an enterprise in currency transactions and when converting monetary assets and liabilities other than RMB into RMB at the end of the tax year according to the central parity rate of the spot RMB exchange rate at the end of the period, except Deductions are allowed except those that have been included in the cost of the relevant assets and those related to profit distribution to owners.
Article 40 The employee welfare expenses incurred by the enterprise shall be deducted if they do not exceed 14% of the total wages and salaries.
Article 41 The union funds allocated by the enterprise shall not exceed 2% of the total wages and salaries, and shall be deducted.
Article 42 Unless otherwise stipulated by the financial and taxation authorities of the State Council, the part of employee education expenditures incurred by an enterprise that does not exceed 2.5% of the total wages and salaries shall be allowed to be deducted; the excess shall be allowed to be used as deductions. Deductions are carried forward to future tax years.
Article 43 Business entertainment expenses incurred by an enterprise related to production and operation activities shall be deducted at 60% of the amount incurred, but the maximum shall not exceed 5‰ of the sales (business) income of the year.
Article 44: Qualified advertising and business promotion expenses incurred by an enterprise shall not exceed 15% of the sales (operating) income of the current year, unless otherwise specified by the financial and taxation authorities of the State Council. , deduction is allowed; the excess amount is allowed to be carried forward for deduction in subsequent tax years.
Article 45 Special funds withdrawn by enterprises in accordance with relevant provisions of laws and administrative regulations for environmental protection, ecological restoration, etc. shall be deducted. If the use of the above-mentioned special funds is changed after withdrawal, no deduction shall be allowed.
Article 46 If an enterprise participates in property insurance, the insurance premiums paid in accordance with regulations shall be deducted.
Article 47 The lease fees paid by an enterprise for leasing fixed assets according to the needs of production and operation activities shall be deducted according to the following methods:
(1) Renting fixed assets in the form of operating lease The leasing expenses incurred on assets shall be deducted evenly according to the lease term;
(2) The leasing expenses incurred on leasing fixed assets under financing leasing shall be withdrawn as part of the value of fixed assets under financing leasing according to regulations. Depreciation expenses are deducted in installments.
Article 48 Reasonable labor protection expenses incurred by the enterprise shall be deducted.
Article 49 Management fees paid between enterprises, rents and royalties paid between business institutions within an enterprise, and interest paid between business institutions within a non-bank enterprise shall not be deducted. .
Article 50 If a non-resident enterprise establishes an institution or place in China, it can provide a collection of expenses issued by the head office for expenses incurred by its head office outside China related to the production and operation of the institution or place. If the scope, quota, allocation basis and method and other supporting documents are provided, and the allocation is reasonable, the deduction will be allowed.
Article 51 “Public welfare donations” as mentioned in Article 9 of the Enterprise Income Tax Law refer to the donations made by enterprises through public welfare social groups or people’s governments at or above the county level and their departments for the purposes of the “People’s Government of the People’s Republic of China” Donations to public welfare undertakings stipulated in the Public Welfare Donation Law of the Republic of China.
Article 52 The term “public welfare social groups” as mentioned in Article 51 of these Regulations refers to foundations, charitable organizations and other social groups that meet the following conditions:
( 1) Registered in accordance with the law and having legal person status;
(2) Aiming to develop public welfare undertakings and not for profit;
(3) All assets and their added value are Owned by a legal person;
(4) Revenues and operating balances are mainly used for undertakings consistent with the purpose of the legal person's establishment;
(5) The remaining property after termination does not belong to any individual or profit-making organization ;
(6) Do not operate businesses unrelated to the purpose of its establishment;
(7) Have a sound financial accounting system;
(8) Donors do not Participate in the distribution of property of social groups in any form;
(9) Other conditions stipulated by the financial and taxation authorities of the State Council in conjunction with the registration and management departments such as the civil affairs department of the State Council.
Article 53: Public welfare donation expenditures incurred by an enterprise shall be deducted if they do not exceed 12% of the total annual profits.
Total annual profit refers to the annual accounting profit of an enterprise calculated in accordance with the provisions of the national unified accounting system.
Article 54 The sponsorship expenditures referred to in Item (6) of Article 10 of the Enterprise Income Tax Law refer to various non-advertising expenditures incurred by enterprises that have nothing to do with production and business activities.
Article 55 The unapproved reserve expenditures referred to in Item (7) of Article 10 of the Enterprise Income Tax Law refer to the impairment of various assets that do not comply with the provisions of the financial and taxation authorities of the State Council. Reserve expenditures such as preparations and risk reserves.
Section 4 Tax Treatment of Assets
Article 56 Various assets of an enterprise, including fixed assets, biological assets, intangible assets, long-term deferred expenses, investment assets, Inventories, etc., are taxed based on historical cost.
The historical cost mentioned in the preceding paragraph refers to the actual expenditure incurred by the enterprise when acquiring the asset.
If the assets appreciate or depreciate during the period when an enterprise holds various assets, the tax basis of the assets shall not be adjusted unless the financial and taxation authorities of the State Council stipulate that profits and losses can be recognized.
Article 57 The term “fixed assets” as mentioned in Article 11 of the Enterprise Income Tax Law refers to assets held by an enterprise for the purpose of producing products, providing labor services, leasing or operating and managing, and used for more than 12 months. Non-monetary assets include houses, buildings, machinery, machinery, transportation and other equipment, appliances, tools, etc. related to production and business activities.
Article 58 The tax basis of fixed assets shall be determined according to the following method:
(1) For purchased fixed assets, the purchase price and relevant taxes paid and directly attributable Other expenses incurred in making the asset reach its intended use shall be the tax base;
(2) For self-constructed fixed assets, the expenses incurred before completion and settlement shall be the tax base;
(3) For fixed assets leased under financing, the tax base shall be based on the total payment agreed in the lease contract and the relevant expenses incurred by the lessee during the signing of the lease contract. If the total payment is not agreed upon in the lease contract, the fair value of the asset shall be calculated. The relevant expenses incurred during the signing of the lease contract with the lessee shall be the tax base;
(4) For fixed assets that are in surplus, the full replacement value of similar fixed assets shall be the tax base;
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(5) For fixed assets acquired through donations, investments, non-monetary asset exchanges, debt restructuring, etc., the tax calculation base is based on the fair value of the assets and the relevant taxes paid;
< p> (6) For renovated fixed assets, in addition to the expenditures specified in Items (1) and (2) of Article 13 of the Enterprise Income Tax Law, the tax base will be increased by the reconstruction expenditures incurred during the reconstruction process.Article 59 Depreciation of fixed assets calculated according to the straight-line method is allowed to be deducted.
An enterprise shall calculate depreciation from the month following the month in which fixed assets are put into use; for fixed assets that cease to be used, depreciation shall be calculated from the month following the month in which they cease to be used.
Enterprises should reasonably determine the estimated net residual value of fixed assets based on their nature and use. Once the estimated net residual value of fixed assets is determined, it cannot be changed.
Article 60 Unless otherwise stipulated by the finance and tax authorities of the State Council, the minimum period for calculating depreciation of fixed assets is as follows:
(1) For houses and buildings, 20 years ;
(2) Airplanes, trains, ships, machines, machinery and other production equipment, for 10 years;
(3) Appliances, tools and furniture related to production and business activities etc., for 5 years;
(4) Transportation vehicles other than airplanes, trains, and ships, for 4 years;
(5) Electronic equipment, for 3 years.
Article 61 For enterprises engaged in the exploitation of oil, natural gas and other mineral resources, the expenses incurred before commencing commercial production and the depreciation and depreciation methods of related fixed assets shall be separately determined by the finance and taxation authorities of the State Council. Regulation.
Article 62 The tax basis for productive biological assets shall be determined according to the following method:
(1) For purchased productive biological assets, the purchase price and relevant taxes paid shall be calculated as follows: Fees are the basis for tax calculation;
(2) For productive biological assets obtained through donations, investments, non-monetary asset exchanges, debt restructuring, etc., the fair value of the assets and the relevant taxes paid as the basis for tax calculation.
The so-called productive biological assets in the preceding paragraph refer to biological assets held by enterprises for the production of agricultural products (28.16,0.02,0.07%, Stock Bar), provision of labor services, or leasing, including economic forests and firewood. Forests, livestock and draft animals, etc.
Article 63 The depreciation of productive biological assets calculated according to the straight-line method shall be deducted.
Enterprises shall calculate depreciation from the month following the month in which productive biological assets are put into use; depreciation shall be stopped from the month following the month in which productive biological assets cease to be used.
Enterprises should reasonably determine the estimated net residual value of productive biological assets based on the nature and use of productive biological assets. Once the estimated net residual value of productive biological assets is determined, it cannot be changed.
Article 64 The minimum number of years for calculating depreciation of productive biological assets is as follows:
(1) For forest productive biological assets, it is 10 years;
(2) Livestock productive biological assets, for 3 years.
Article 65 The term “intangible assets” as mentioned in Article 12 of the Enterprise Income Tax Law refers to non-monetary assets that have no physical form and are held by enterprises for the purpose of producing products, providing services, leasing or operating management. Long-term assets include patent rights, trademark rights, copyrights, land use rights, non-patented technologies, goodwill, etc.
Article 66 The tax basis for intangible assets shall be determined according to the following method:
(1) For outsourced intangible assets, the purchase price and relevant taxes paid and their direct attribution shall be determined. Other expenses incurred in making the asset reach its intended use shall be the tax base;
(2) For self-developed intangible assets, the expenses incurred during the development process after the asset meets the capitalization conditions and before it reaches its intended use Expenditure is the basis for tax calculation;
(3) Intangible assets obtained through donations, investments, non-monetary asset exchanges, debt restructuring, etc. shall be calculated based on the fair value of the assets and the relevant taxes paid. tax basis.
Article 67 The amortization expenses of intangible assets calculated according to the straight-line method are allowed to be deducted.
The amortization period of intangible assets shall not be less than 10 years.
As an investment or transferred intangible asset, if the useful life is stipulated in relevant laws or contracts, it can be amortized in installments according to the prescribed or agreed useful life.
Expenditures for outsourced goodwill are allowed to be deducted when the entire enterprise is transferred or liquidated.
Article 68 The expenditures for renovation of fixed assets referred to in Items (1) and (2) of Article 13 of the Enterprise Income Tax Law refer to changes in the structure of houses or buildings and extension of their service life. expenditures incurred.
Amortized over time.
If the useful life of renovated fixed assets is extended, in addition to the provisions of Items (1) and (2) of Article 13 of the Enterprise Income Tax Law, the depreciation period shall be appropriately extended.
Article 69 The expenditure for major repairs of fixed assets referred to in Item (3) of Article 13 of the Enterprise Income Tax Law refers to expenditure that meets the following conditions at the same time:
( 1) The repair expenditure reaches more than 50% of the tax basis when the fixed asset is acquired;
(2) The useful life of the fixed asset after repair is extended by more than 2 years.
The expenditures specified in Item 3 of Article 13 of the Enterprise Income Tax Law shall be amortized in installments based on the remaining useful life of the fixed assets.
Article 70: Other expenditures that should be regarded as long-term deferred expenses as mentioned in Item (4) of Article 13 of the Enterprise Income Tax Law shall be amortized in installments starting from the month following the month in which the expenditure occurs. The term shall not be less than 3 years.
Article 71 The investment assets referred to in Article 14 of the Enterprise Income Tax Law refer to the assets formed by enterprises’ external equity investments and debt investments.
When an enterprise transfers or disposes of investment assets, the cost of the investment assets is allowed to be deducted.
The cost of investment assets is determined according to the following method:
(1) For investment assets obtained by paying cash, the cost is the purchase price;
(2) For investment assets acquired by means other than cash payment, the cost is the fair value of the asset and the relevant taxes paid.
Article 72 The term “inventory” as mentioned in Article 15 of the Enterprise Income Tax Law refers to the products or commodities held by the enterprise for sale, products in the process of production, production or provision of services. Materials and supplies consumed in the process, etc.
The cost of inventories is determined according to the following methods:
(1) For inventories obtained by paying cash, the cost is the purchase price and relevant taxes paid;
(2) Inventories obtained by means other than cash payment shall be based on the fair value of the inventory and the relevant taxes paid;
(3) Agricultural products harvested from productive biological assets shall be based on the output Or necessary expenses such as material fees, labor fees and shared indirect costs incurred during the harvesting process are costs.
Article 73 The cost calculation method for the inventory used or sold by an enterprise may be one of the first-in, first-out method, the weighted average method, and the individual valuation method. Once the pricing method is selected, it cannot be changed at will.
Article 74 The net value of assets as mentioned in Article 16 of the Enterprise Income Tax Law and the net value of property as mentioned in Article 19 refer to the tax base deductions for relevant assets and properties that have been deducted in accordance with regulations. The balance after depreciation, depletion, amortization, reserves, etc.
Article 75 Unless otherwise stipulated by the finance and tax authorities of the State Council, during the reorganization process, an enterprise shall recognize the income or loss from the transfer of relevant assets when the transaction occurs, and the relevant assets shall be based on the transaction price. Redetermine the tax basis.