According to Article 20 of the Regulations for the Implementation of the Enterprise Income Tax Law of People's Republic of China (PRC) (the State Council Order No.512 of the People's Republic of China), the income from royalties mentioned in Item (7) of Article 6 of the Enterprise Income Tax Law refers to the income obtained by enterprises from providing the right to use patents, non-patented technologies, trademarks, copyrights and other franchises.
What's the difference between royalties and royalties?
Royalty income refers to the income obtained by enterprises from providing franchise rights such as patents, non-patented technologies, trademarks and copyrights. Royalty income shall be recognized according to the date when the concessionaire pays the royalties as agreed in the contract.
Franchise fee can be understood as the fee charged for franchising certain goods or services, such as Olympic licensed goods, and the franchisee pays the franchise fee to the Olympic Organizing Committee according to a certain proportion of sales. The commission ratio is generally 5- 15% of the retail price of goods. Franchise fees for the provision of equipment and other tangible assets are recognized at the time of asset delivery or asset ownership transfer.
What is royalty?
A: Royalties include:
(a) the patent right or proprietary technology use fee; (2) royalties from trademark rights;
(3) royalties;
(four) the cost of the right to issue, sell or other similar rights.
The tax conditions for royalties are:
(1) Royalties are related to imported goods;
(2) Payment of royalties constitutes a condition for selling imported goods to People's Republic of China (PRC).
What is the difference between royalties and royalties in tax law?
Royalty refers to the royalty paid by the user of the asset to the provider of the asset (the provider of the asset should provide corresponding services) during the use process (because the equipment or other tangible assets can only be used by a single user for a period of time, it is called royalty); For example, Company A provides a machine to Company B and promises to repair the equipment within two years, and Company B has to pay the corresponding price. Therefore, the price received by Company A in the actual maintenance process is royalty, which should be confirmed when providing maintenance services. .
Royalty income refers to the income obtained by enterprises from providing franchise rights such as patents, non-patented technologies, trademarks and copyrights.
What does the royalty include? What are the taxable conditions?
A: Royalties include:
(a) the patent right or proprietary technology use fee;
(2) royalties from trademark rights;
(3) royalties;
(four) the cost of the right to issue, sell or other similar rights.
The tax conditions for royalties are:
(1) Royalties are related to imported goods;
(2) Payment of royalties constitutes a condition for selling imported goods to People's Republic of China (PRC).
Royalty range
It is particularly important to note that State Taxation Administration of The People's Republic of China has defined the following four types of royalties in the form of Notice (Guo [2009] No.507), which do not belong to royalties: first, the after-sales service remuneration under the simple trade of goods; Second, the remuneration received by the seller for providing services to the buyer during the product warranty period; Three, refers to the relevant services obtained by institutions or individuals specializing in engineering, management, consulting and other professional services; 4. Other similar remuneration stipulated by People's Republic of China (PRC) and State Taxation Administration of The People's Republic of China. It can be seen that the definition of royalties is still basically limited to all kinds of licensing income related to intellectual property rights. (2) Application of Franchise Article 8 (3) of the Agreement stipulates: "As a condition for the sale of the appraised goods, the buyer must directly or indirectly pay the royalties related to the appraised goods, as long as the royalties are not included in the paid or payable price", and the royalties should be included in the dutiable price. Conditions for the royalty to be included in the customs value of imported goods: 1. Related to the expected goods: it is a complex problem to determine whether the royalties are related to the expected goods. When we analyze and estimate the payment relationship between goods (tangible goods) and rights, information or services (intangible goods), we generally have to grasp a basic principle: whether importers can get tangible goods without buying intangible goods. If the answer is yes, then it can be concluded that royalties have nothing to do with the estimated goods and should be priced separately as far as possible; If the answer is no, it can be concluded that the royalty is related to the estimated goods. The right to copy imported goods has nothing to do with the estimated goods. 2. As a condition for selling the appraised goods. 3. As a condition of selling the appraised goods, the payment of royalties must be a condition of selling the appraised goods, which is an important criterion to judge whether the royalties become part of the customs value of the appraised goods. The sales mentioned here refer to the export sales of the importing country. Therefore, after the goods are imported, the royalties generated by the importer when reselling the goods in the importing country, even if they become the conditions for resale, cannot become part of the duty-paid price.
How to define royalties?
A few days ago, the customs of Suzhou Industrial Park paid a tax of 330,000 yuan to a pharmaceutical company within its jurisdiction, aiming at the royalties of the company's imported goods in 2006. Since 2004, the customs has paid a total of 7.46 million yuan in royalties. It is understood that the lack of understanding of the relevant provisions on the taxation of royalties is the main reason for tax evasion by enterprises. To this end, the customs specially reminded the import and export enterprises that royalties should be fully considered when declaring the duty-paid price. The Measures for Examination and Approval of Import and Export Dutiable Price in People's Republic of China (PRC) is defined as: Royalty refers to the expenses paid by the buyer of imported goods to obtain the license or transfer of patent right, trademark right, know-how, copyright, distribution right or sales right from the intellectual property right holder and its effective authorizer. According to this definition, it is not difficult to find three characteristics of royalties: first, the property rights brought by intellectual and natural achievements; Second, it is used by others after payment, not by the obligee himself; Third, the obligee collects royalties according to the degree to which others actually use their rights. According to this method, royalties that meet certain conditions should be included in the customs value and declared to the customs when the goods are imported. According to the customs regulations, the royalties of imported goods have nothing to do with the goods, and if the payment does not constitute the conditions for selling the goods to People's Republic of China (PRC), it will not be included in the scope of customs taxation. In other words, everything else should be included in the duty-paid price. The following four situations are considered to be related to goods: first, imported goods are used to pay for the right to use patents or proprietary technologies, which belongs to one of the following situations: first, they contain patents or proprietary technologies; Second, it is produced by patented method or proprietary technology; Third, it is specially designed or manufactured for the implementation of patents or proprietary technologies. Second, it is used to pay trademark rights, and the imported goods belong to one of the following circumstances: first, they are accompanied by trademarks; Second, after import, it can be directly sold with a trademark; Third, the trademark right has been included in the import, and it can be sold after light processing and labeling. 3. Imported goods used to pay copyright fall into one of the following circumstances: 1. Imported goods containing software, words, music, pictures, images or other similar contents, including tapes, diskettes, compact discs or other similar media; Second, imported goods containing other copyright contents. Fourth, it is used to pay distribution rights, sales rights or other similar rights. Imported goods belong to one of the following circumstances: First, they can be sold directly after import; Second, light processing can be sold. In this case, the royalties involved in the company's imported goods mainly include two aspects: one is the expenses paid for the formulation and technology of manufacturing, using and selling drugs (that is, the proprietary technology expenses), and the other is the trademark rights expenses of finished drugs. After investigation, the declared price of the company's finished drugs at the time of import has included the patent fee of proprietary technology, and the production and processing of raw materials are mainly completed in China. The royalties of these two proprietary technologies need not be included in the customs value of imported goods. As for the trademark right use fee of the original drug imported from the raw material drug countries, because its domestic production does not belong to the category of light processing, there is no need to tax it. However, the royalties of trademark rights of drugs imported in the finished product state should be included in the duty-paid price to pay taxes. In recent years, with the continuous strengthening of intellectual property protection and brand awareness of enterprises, the proportion of patent fees in products has gradually increased. In order to ensure the full collection of taxes receivable by the state and maintain a good order of import and export operations, the customs will intensify its investigation and punishment of non-voluntary payment of royalties.
What does royalty mean?
Please refer to the customs order 148 for details, which means whether the customs clearance price of your imported software includes patent fees (patent fees, technical fees, etc.). )? The criterion is whether you have signed another agreement to import this software. Do you have to pay extra royalties for it? Otherwise you can't get the goods, or you can't get the goods at the original import price.
General meaning of royalties
(1) means that royalties refer to any money that people pay for the use of rights or intangible property (such as information and services). For example, income from individuals providing the right to use patents, trademarks, copyrights, non-patented technologies and other franchises. Before using this right, the non-obligee must obtain the consent of the obligee or pay a certain fee, otherwise it will be regarded as infringement and bear legal responsibility. There is no difference between royalty and license fee in essence, so the agreement uses them together.
How much is the royalty tax?
The commission depends on whether the transferor is an enterprise or an individual.
1, enterprise, pay enterprise income tax.
2. Individuals should pay personal income tax. If the one-time income does not exceed 4,000 yuan, the 800 yuan will be reduced and the tax rate will be 20%; If it exceeds 4000 yuan, it will be reduced by 20% and levied at the tax rate of 20%.
3. VAT will be levied after the reform of the camp.