If the income from royalties does not exceed 4,000 yuan each time, the expenses will be reduced by 800 yuan; if it exceeds 4,000 yuan, the expenses will be reduced by 20%, and the balance will be taxable income. A proportional tax rate of 20% applies. The income from royalties is the income from a franchise.
The calculation formula is: tax payable = taxable income ×20%.
Example: After Li designed the invention patent, he transferred it to a company and won a reward of 50,000 yuan. How should he pay personal income tax?
Taxable amount = 50,000× (1-20% )× 20% = 8,000 yuan.