The expenses mentioned in Article 8 of the Enterprise Income Tax Law refer to the sales expenses, management expenses and financial expenses incurred by an enterprise in its production and operation activities, except the related expenses that have been included in the cost. Business entertainment expenses related to the production and business activities of the enterprise shall be deducted according to 60% of the amount incurred, but the maximum amount shall not exceed 5‰ of the sales (business) income of the year.
Unless otherwise stipulated by the competent department of finance and taxation of the State Council, the eligible advertising expenses and business promotion expenses incurred by the enterprise do not exceed 15% of the sales (business) income of the current year, and are allowed to be deducted; The excess shall be allowed to be carried forward and deducted in future tax years. Items that can be deducted before tax are:
1, cost: refers to the production and operation costs; 2, expenses: refers to the three-phase expenses (sales expenses, management expenses and financial expenses); 3, taxes: refers to the sales tax and surcharges (1); six taxes and one fee: paid consumption tax, business tax, urban construction tax, resource tax, land value-added tax, export duty and education surcharge; (2) If the management fee has been deducted from the property tax, travel tax, land use tax and stamp duty paid by the enterprise, the business tax will not be deducted separately. The taxes paid in (1) and (2) above are allowed to be deducted before tax. There are two ways of deduction: one is current deduction; Second, it is included in the cost of relevant assets in the current period and deducted in subsequent periods. (3) VAT is extra-tax, not included in income, and cannot be deducted when calculating taxable income. 4. Losses: refers to the losses and other losses incurred by enterprises in their production and business activities. 5. Other expenses deducted refer to the reasonable expenses related to the production and operation activities of the enterprise except costs, expenses, taxes and losses.