According to the relevant laws and regulations of our country, some expenses can not be deducted when calculating taxable income, including tax late fees. Therefore, the late fee for patent annual fee cannot be used as a pre-tax deduction item. Similarly, corporate income tax cannot be deducted before tax. This means that if an enterprise or individual pays the annual patent fee, it will not reduce its taxable income, thus affecting the calculation of pre-tax profit.
Tax treatment of patents:
1. Patent application fee: expenses incurred in the process of patent application, such as application fee and examination fee, can be deducted before tax as research and development expenses;
2. Annual patent fee: the annual fee paid by an enterprise to safeguard the patent right can usually be deducted before tax;
3. Income from patent transfer: the income from the transfer of patent rights by an enterprise to others shall be subject to enterprise income tax in accordance with the relevant provisions on the transfer of intangible assets;
4. Royalty income: Royalty obtained by an enterprise from licensing others to use its patent rights shall be regarded as the income of the enterprise, and the enterprise income tax shall be paid after deducting relevant costs and expenses;
5. Compensation for patent infringement: The enterprise income tax can be levied according to the specific circumstances for the compensation obtained by the enterprise for patent infringement.
To sum up, the late fee for patent annual fee cannot be deducted before tax, which will affect the calculation of taxable income and pre-tax profit of enterprises or individuals.
Legal basis:
People's Republic of China (PRC) enterprise income tax law
Article 10
When calculating taxable income, the following expenses shall not be deducted:
(1) Dividends, bonuses and other equity investment income paid to investors;
(2) enterprise income tax;
(3) tax late fees;
(four) fines, fines and confiscation of property losses;
(5) Donation expenditures other than those specified in Article 9 of this Law;
(6) sponsorship expenditure;
(7) Unapproved reserve expenditure;
(eight) other expenses unrelated to income.