12 On February 29th, the executive meeting of the State Council decided to continue to implement some preferential policies for individual income tax. One of them is to extend the one-time bonus for the whole year to the end of 2023, not to be incorporated into the salary income of the current month, and to implement the policy of separate taxation on a monthly basis. The meeting pointed out that this move is to reduce the personal income tax burden and ease the pressure on low-and middle-income groups.

The new round of individual tax reform has been fully implemented since 20 19, which mainly combines four incomes obtained by individuals into "comprehensive income" and pays taxes according to the combined comprehensive income, with a unified progressive tax rate of 3%-45%.

It should be noted that for the year-end award, the policy has been separately stipulated.

Before the tax reform, the year-end bonus has never been hungry and enjoyed the preferential policy of "separate taxation". According to the new requirements of the reform, the year-end bonus must also be incorporated into comprehensive income and "consolidated taxation". In order to ensure the smooth convergence of policies, a three-year transition period has been set up. During the transition period, taxpayers can "choose one" between separate taxation and consolidated taxation of year-end awards. By the end of 202 1, the three-year transition period is over. The Ministry of Finance and State Taxation Administration of The People's Republic of China have made it clear that from June 65438+1 October1day, 2022, if an individual obtains a one-time bonus for the whole year, it should be incorporated into the comprehensive income of that year to pay a tax.

At the end of the transition period, the State Council will definitely continue to implement the preferential policy of "two choices" for year-end bonus tax until the end of 2023. In other words, before the end of 2023, individual taxpayers can still choose a more cost-effective taxation method between consolidated taxation and separate taxation according to their income composition.