According to the provisions of the "Notice of the Ministry of Finance and the State Administration of Taxation on the Treatment of Enterprise Income Tax on Special-Purpose Fiscal Funds" (Finance and Taxation [2009] No. 87): "For enterprises on January 1, 2008 The fiscal funds obtained from the financial departments and other departments of the people's governments at or above the county level during the period that should be included in the total income during the period up to December 31, 2010, if they meet the following conditions at the same time, can be regarded as non-taxable income, and will not be used in the calculation of taxable income. When taxing income, it is deducted from the total income: (1) The enterprise can provide funds allocation documents, and the documents stipulate the special purpose of the funds; (2) The financial department or other government departments that allocate funds have special funds for the funds Management measures or specific management requirements; (3) The enterprise shall separately account for the funds and the expenditures incurred with the funds.”

From your company’s situation, this special fund complies with the “Notice”. It stipulates various specific conditions that can be regarded as non-taxable income, which should be converted into non-taxable income and no corporate income tax is required.