The statutory deduction items of corporate income tax are the items based on which the taxable income of corporate income tax is determined. The corporate income tax regulations stipulate that the taxable income of an enterprise is determined by the total income of the enterprise minus costs, expenses, losses and allowed deductions. Costs refer to the direct expenses and indirect expenses incurred by taxpayers in producing, operating goods and providing services. Expenses refer to the sales expenses, management expenses and financial expenses incurred by taxpayers for the production and operation of goods and the provision of labor services. Losses refer to various non-operating expenses, operating losses, investment losses, etc. incurred by taxpayers in the production and operation process. In addition, when calculating the taxable income of an enterprise, if the financial accounting treatment of the taxpayer is inconsistent with the tax regulations, adjustments shall be made in accordance with the tax regulations. In addition to the statutory deduction items for corporate income tax, including costs, expenses and losses, the relevant tax regulations also specify some deduction items that require tax adjustments according to tax regulations.
Mainly include the following contents:
⑴ Deduction of interest expenses. During the period of production and operation, taxpayers' interest expenses on borrowings from financial institutions shall be deducted based on the actual amount incurred; interest expenses on borrowings from non-financial institutions shall not exceed the amount calculated based on the interest rate of similar loans from financial institutions for the same period. deduct.
⑵ Deductions from taxable wages. The regulations stipulate that reasonable wages and salaries of enterprises shall be deducted according to the actual situation, which means that the tax calculation and salary system of domestic-funded enterprises that has been implemented for many years has been abolished, effectively reducing the burden of domestic-funded enterprises. However, the wages and salaries that are allowed to be deducted based on the facts must be "reasonable", and wages and salaries that are obviously unreasonable will not be deducted. In the future, the State Administration of Taxation will clarify "reasonable" by formulating the "Wage Deduction Management Measures" supporting the "Implementation Regulations".
⑶ In terms of employee welfare fees, trade union funds and employee education funds, the implementation regulations continue to maintain the previous deduction standards (withdrawal ratios are 14, 2, and 8 respectively), but the "total taxable wages" will be Adjusted to "total wages and salaries", the deduction amount will be increased accordingly. In terms of employee education funds, in order to encourage enterprises to strengthen their investment in employee education, the Implementing Regulations stipulate that, unless otherwise provided by the financial and taxation authorities of the State Council, the employee education expenses incurred by enterprises shall be deducted if they do not exceed 8% of the total wages and salaries; the excess shall be allowed to be deducted. , allowing carryover deductions to subsequent tax years.
⑷Deduction of donations. Taxpayers' public welfare and relief donations are allowed to be deducted if they are within 12% of the annual accounting profit. The portion exceeding 12% will be allowed to be carried forward and deducted in the next three years when calculating taxable income.
⑸Deduction of business entertainment expenses. Business entertainment expenses refer to the social entertainment expenses incurred by taxpayers for the reasonable needs of producing and operating business. The tax law stipulates that business entertainment expenses incurred by taxpayers related to production and business operations shall be deducted within the following limits if the taxpayer provides accurate records or documents: Article 43 of the "Enterprise Income Tax Law Implementation Regulations" further clarifies that business entertainment expenses incurred by an enterprise related to production and operation shall be deducted at the rate of 60% of the amount incurred, but the maximum shall not exceed the current year's sales (5‰ of the operating income, that is, , the tax law adopts the "two-end card" method. On the one hand, the business entertainment expenses incurred by the enterprise are only allowed to be expensed 60, in order to distinguish the business entertainment and personal consumption in the business entertainment expenses, and design a unified ratio to divide the business. The personal consumption part of the entertainment expenses is removed; on the other hand, the maximum deduction is limited to 5‰ of the sales (business) income of the year. This is to prevent some companies from using more meal expenses to increase the business entertainment expenses by 40%. Invoices or even fake invoices are offset, resulting in inflated business entertainment expenses.
⑹ Deductions for employee pension funds and unemployment insurance funds are subject to the approval of the provincial tax department. The deduction for the disability security fund paid by the taxpayer in accordance with local government regulations is allowed in the calculation of taxable income. Deduction of property and transportation insurance premiums paid by taxpayers is allowed in tax calculation.
However, the preferential treatment of no compensation given by insurance companies to taxpayers should be included in the taxable income of the enterprise.
⑼Deduction of fixed asset rental fees. The leasing fees of fixed assets leased by taxpayers in the form of operating leases can be directly deducted before tax; the leasing fees of fixed assets rented by taxpayers in the form of financial leases cannot be directly deducted before tax, except for the interest expenses in the leasing fees. The handling fee can be deducted directly when paying.
⑽ Deductions for bad debt reserves, doubtful debt reserves and commodity price reduction reserves. Bad debt reserves and doubtful debt reserves set aside by taxpayers are allowed to be deducted when calculating taxable income. The withdrawal standards are temporarily implemented according to the financial system. The commodity price reduction reserves withdrawn by taxpayers are allowed to be deducted when calculating taxes.
⑾Deduction of expenses for transferring fixed assets. Taxpayers’ expenditures on transferring fixed assets refer to the cleaning expenses and other expenses incurred when transferring and selling fixed assets. Taxpayers' expenditures on transferring fixed assets are allowed to be deducted during tax calculation.
⑿ Deduction of net losses from inventory losses, damage, and scrapping of fixed assets and current assets. Net losses incurred by taxpayers due to inventory losses, damage, or scrapping of fixed assets shall be deducted after taxpayers provide inventory and inventory information and are reviewed by the competent tax authorities. The net loss mentioned here does not include the income from the change in price of the company's fixed assets. Net losses incurred by taxpayers from inventory losses, damage, and scrapping of current assets can be deducted before tax after the taxpayer provides inventory information and is reviewed by the competent tax authorities.
⒀Deduction of head office management fees. For management fees paid by taxpayers to the head office related to the production and operation of the enterprise, they shall provide documents proving the scope, quota, allocation basis and method of management fees issued by the head office, and shall be allowed to be deducted after being reviewed by the competent tax authorities.
⒁ Deduction of national debt interest income. Interest income from taxpayers purchasing treasury bonds is not included in taxable income.
⒂Deduction of other income. Turnover taxes including various fiscal subsidy income, exemptions or refunds may not be included in the taxable income unless specified by the State Council, the Ministry of Finance and the State Administration of Taxation. The rest shall be included in the calculation of the enterprise's taxable income. Tax.
⒃Deduction for loss compensation. Annual losses incurred by taxpayers can be made up with the income of the next year. If the income of the next tax year is insufficient to make up, the losses can be made up year by year, but the longest period shall not exceed 5 years.
Response time: 2020-12-09. For the latest business changes, please refer to the official website of Ping An Bank.
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