Wages and salaries of employees refer to all cash or non-cash labor remuneration paid by an enterprise to employees who work in the enterprise or have an employment relationship with it in each tax year, including basic salary, bonus, allowance, subsidy, year-end salary increase, overtime pay and other expenses related to employment or employment.
Pre-tax deduction mainly refers to the pre-tax deduction items of income tax, including the items that can be deducted before enterprise income tax and personal income tax. Pre-tax deduction mainly includes: reasonable and actual expenses related to income, including costs, expenses, taxes, losses and other expenses, which are allowed to be deducted when calculating taxable income.
legal ground
measures for the pre tax deduction of enterprise income tax
Article 4 Unless otherwise stipulated by tax laws and regulations, the confirmation of pre-tax deduction shall generally follow the following principles:
(1) accrual principle. That is, the taxpayer should confirm the deduction when the expenses occur rather than when they are actually paid.
(2) the principle of proportionality. That is, the expenses incurred by taxpayers should be declared and deducted in the current period when the expenses should be matched or distributed. The deductible expenses that taxpayers should declare in a tax year shall not be declared in advance or later.
(3) the principle of relevance. That is, the deductible expenses of taxpayers must be related to the nature and source of taxable income.
(4) the principle of certainty. That is, whenever taxpayers can deduct expenses, they must determine the amount.
(5) the principle of rationality. In other words, the calculation and distribution method of taxpayers' deductible expenses should conform to general business practices and accounting practices. Article 5 The expenses incurred by taxpayers must be strictly distinguished from operating expenses and capital expenditures. Capital expenditure shall not be deducted directly in the current period, but must be depreciated, amortized or included in the relevant investment cost in accordance with the provisions of tax laws and regulations.
Interim Regulations of People's Republic of China (PRC) Municipality on Enterprise Income Tax
Article 4 The total income of a taxpayer in each tax year, after deducting the allowable deductions, is the taxable income. Article 6 Items that are allowed to be deducted when calculating taxable income refer to the costs, expenses and losses related to taxpayers' income.
The following items shall be deducted according to the prescribed scope and standards:
(1) The interest expenses incurred by taxpayers in borrowing from financial institutions during the production and operation period shall be deducted according to the actual amount; The interest expense of borrowing from non-financial institutions is not higher than the amount calculated according to the interest rate of similar loans of financial institutions in the same period, and deduction is allowed.
(2) The wages paid by taxpayers to employees shall be deducted according to the taxable wages. The specific standards for taxable wages shall be stipulated by the people's governments of provinces, autonomous regions and municipalities directly under the Central Government within the scope prescribed by the Ministry of Finance and reported to the Ministry of Finance for the record.
(3) The taxpayer's trade union funds, employee welfare funds and employee education funds are deducted respectively according to 2%, 14% and 2.5% of the total taxable wages.
(4) Donations made by taxpayers for public welfare and relief are allowed to be deducted within 3% of the annual taxable income.
In addition to the provisions of the second paragraph of this article, other items shall be deducted in accordance with laws, administrative regulations and relevant state tax regulations. Article 2 The following enterprises or organizations that practice independent economic accounting are taxpayers of enterprise income tax (hereinafter referred to as taxpayers):
(1) State-owned enterprises;
(2) Collective enterprises;
(3) private enterprises;
(4) Joint ventures;
(5) Joint-stock enterprises;
(six) other organizations with production, business income and other income.