Journalism

Dalian finance company reminds you - New Deal!The difference between the bonus paid within the year and after the year may be more than 10000 yuan!

2021-10-27

The recent emergency policy concerns everyone's vital interests.Personal tax has changed and will be implemented on January 1, next year

It is clear in the document that: Since January 1, 2022, the preferential algorithm is no longer applicable to individual year-end bonus, that is, it can not be taxed separately, but should be included in the current year's comprehensive income to pay individual income tax.


The way of paying taxes on year-end bonus will change, The difference between the bonus paid within the year and after the year may be more than 10000 yuan!


According to the provisions of the notice of the Ministry of Finance and the State Administration of Taxation on the convergence of preferential policies after the amendment of the individual income tax law, if a resident obtains a one-off annual bonus in accordance with the provisions of the notice of the State Administration of Taxation on adjusting the method for calculating and collecting individual income tax such as obtaining annual one-off bonus, before December 31, 2021,Not included in the current year's comprehensive income, the annual one-time bonus income divided by the amount of 12 months.


According to the monthly converted comprehensive income tax rate table attached to this Circular (hereinafter referred to as the monthly tax rate table), the applicable tax rate and the quick calculation deduction amount shall be determined, and the tax payment shall be calculated separately.The calculation formula is as follows:


Tax payable = annual lump sum bonus income×Applicable tax rate - quick deduction


If a resident obtains a one-off annual bonus, he may also choose to incorporate it into the current year's comprehensive income for tax calculation.


Since January 1, 2022, the annual one-time bonus obtained by individual residents shall be included in the current year's comprehensive income to calculate and pay individual income tax.


That is to say, there are two ways to calculate individual income tax for the year-end bonus obtained in this year Separate taxation and Consolidated Taxation 。By next year's income, only Consolidated Taxation One way.


Separate taxation and consolidated taxation are suitable for different ways of year-end bonus payment.


2、 Tax rate table of individual income tax


According to the individual income tax law of the people's Republic of China, the following items of individual income shall be subject to individual income tax:


(1) Income from wages and salaries;

(2) Income from remuneration for labor services;

(3) Income from author's remuneration;

(4) Royalty income;

(5) Business income;

(6) Income from interest, dividend and bonus;

(7) Income from lease of property;

(8) Income from the transfer of property;

(9) By chance.


Income from wages and salaries obtained by individual residents;Income from remuneration for labor services;Income from author's remuneration;Income from royalties (hereinafter referred to as comprehensive income) shall be consolidated to calculate individual income tax according to the tax year;If there is a withholding agent, the withholding agent shall withholding the tax in advance on a monthly or per time basis;


If it is necessary to handle the final settlement, the final settlement shall be conducted within the period from March 1 to June 30 of the next year in which the income is obtained.


Income from wages and salaries of non resident individuals;Income from remuneration for labor services;Individual income tax shall be calculated on a monthly or itemized basis on the income from remuneration and royalties, and no final settlement shall be made.


1、 Table of withholding rate of personal wages and salaries of residents

2、 Income from remuneration for personal services, contributions and royalties


For income from remuneration for labor services, remuneration for authors and royalties, the amount of tax to be withheld and prepaid shall be calculated based on the amount of each income.


Income: income from remuneration for labor, remuneration for authors and royalties shall be the balance of income after deducting expenses;Among them, the income from author's remuneration is calculated by 70%.


Less expenses: When withholding tax If the income from remuneration for labor services, remuneration for contributions and royalties does not exceed 4000 yuan each time, the deduction of expenses shall be calculated at 800 yuan;If the income is more than 4000 yuan each time, the expenses shall be deducted according to 20% of the income.


(1) Table of withholding rate of personal labor remuneration income of residents   


(2) A 20% withholding rate shall be applied to the income from individual contributions and royalties.


3、 Consolidated income tax rate table

Comprehensive income refers to the income from wages and salaries obtained by individual residents;Income from remuneration for labor services;Income from remuneration and royalties shall be subject to progressive tax rates ranging from 3% to 45% (see Table 1 and 2 above for the table of withholding rates).

Note:

1. The term "annual taxable income" in this table refers to the balance of comprehensive income obtained by individual residents in accordance with the provisions of Article 6 of the individual income tax law of the people's Republic of China after deducting expenses of 60000 yuan and special deduction, special additional deduction and other deductions determined according to law.


2. Income from wages and salaries of non resident individuals;Income from remuneration for labor services;Income from remuneration and royalties shall be calculated on a monthly basis in accordance with this table.


4、 Income from wages and salaries of non residents;Income from remuneration for labor services;Income from author's remuneration;Royalty income tax rate table

For the income from wages and salaries of non residents, the taxable income shall be the balance of monthly income after deducting expenses of 5000 yuan;For income from remuneration for labor services, remuneration for contributions and royalties, the amount of each income shall be regarded as the taxable income.For income from remuneration for labor services, remuneration for authors and royalties, the amount of income shall be the balance of income minus 20% of expenses;Among them, the income from author's remuneration is calculated by 70%.


5、 Business income tax rate table

Excess progressive tax rates of 5% to 35% are applicable to operating income.

Note: the term "annual taxable income" in this table refers to the balance after deducting costs, expenses and losses from the total income of each tax year in accordance with the provisions of Article 6 of the individual income tax law of the people's Republic of China.


6、 Income from interest, dividend and bonus;Income from lease of property;Income from transfer of property and incidental income

Income from interest, dividend and bonus;Income from lease of property;Income from transfer of property and incidental income shall be subject to a proportional tax rate of 20%.(the tax rate is applicable to resident and non resident individuals)


7、 Calculation of individual income tax of year end bonus

If the annual lump sum bonus obtained by an individual resident meets the requirements, it shall not be included in the current year's comprehensive income before December 31, 2021. The amount obtained by dividing the annual one-time bonus income by 12 months shall be determined according to the monthly converted comprehensive income tax rate table to determine the applicable tax rate and quick calculation deduction, and the tax shall be calculated separately.The calculation formula is as follows:

Tax payable = annual lump sum bonus income×Applicable tax rate - quick deduction


If a resident obtains a one-off annual bonus, he may also choose to incorporate it into the current year's comprehensive income for tax calculation. Since January 1, 2022, the annual one-time bonus obtained by individual residents shall be included in the current year's comprehensive income to calculate and pay individual income tax. 


3、 Collection!Personal income tax


1. Subsidies and allowances not in the nature of wages and salaries

The notice of the State Administration of Taxation on printing and distributing the provisions on Several Issues concerning the collection of individual income tax (GSF [1994] No. 089) stipulates that the following subsidies and allowances not belonging to the nature of wages and salaries or the income items of taxpayers' wages and salaries shall not be taxed. One child subsidy;Child care allowance;Travel allowance, meal allowance.


According to the notice of the Ministry of Finance and the State Administration of Taxation on the determination of the scope of subsidy for missed meals (Cai Shui Zi [1995] No. 82), it is stipulated that, according to the regulations of the financial department, an individual who works in the urban or suburban areas on business and can not work in the work unit or return to dinner, and really need to eat out, According to the actual number of meals missed, the meal fee collected according to the prescribed standard is not subject to individual income tax. The subsidies and allowances granted to employees by some units in the name of meal allowance shall be incorporated into the income from wages and salaries of the current month for calculation and collection of individual income tax.


2. The standard official expenses can be deducted from the subsidy income of official vehicle and communication

According to the notice of the State Administration of Taxation on relevant policy issues of individual income tax (GSF [1999] No. 58), the income of official vehicle and communication subsidy obtained by individuals due to the reform of official vehicle and communication system is as follows:, Deduction of standard official expenses After that, the individual income tax shall be calculated and withheld according to the income items of "wages and salaries".

The standard for deduction of official expenses shall be determined by the Provincial Local Taxation Bureau on the basis of the investigation and calculation of the actual occurrence of the taxpayer's official transportation and communication expenses, which shall be determined after being approved by the provincial people's government and reported to the State Administration of Taxation for the record.


3. Tax exemption of welfare (living allowance)

The term "welfare expenses" which can be exempted from tax in Article 4 of the individual income tax law refers to the living subsidies paid to individuals from the welfare funds or trade union funds retained by enterprises, institutions, state organs and social organizations in accordance with the relevant provisions of the state.

According to the notice of the State Administration of Taxation on the determination of the scope of living allowance (GSF [1998] No. 155) stipulates that the living allowance refers to the temporary living allowance paid to the taxpayer or his or her family's normal life due to certain specific events or reasons, and the unit in which he works is paid according to the state regulations from the welfare funds or trade union funds.


4. Tax exemption of relief and pension

According to Item 4 of Article 4 of the individual income tax law, relief and pension are exempt from individual income tax.According to Article 14 of the regulations for the implementation of the individual income tax law of the people's Republic of China, the relief fund refers to the subsidy for living difficulties paid to an individual by the Civil Affairs Department of the people's government at all levels. 


5. Work related injury insurance benefits are tax-free

According to the Ministry of Finance The notice of the State Administration of Taxation on the personal income tax policies related to the industrial injury insurance benefits obtained by industrial injury workers (CS [2012] No. 40) stipulates: "1. The industrial injury insurance benefits obtained by industrial injury workers and their close relatives in accordance with the regulations on industrial injury insurance (order No. 586 of the State Council) shall be exempted from individual income tax.

Industrial injury insurance benefits include one-time disability subsidy, disability allowance, one-time medical subsidy for work-related injury, one-time disability employment subsidy, medical treatment for work-related injury, food subsidy for hospitalization, transportation and accommodation expenses for medical treatment in other places, industrial injury rehabilitation expenses, auxiliary equipment expenses, living and nursing expenses, etc,And the funeral subsidies, pension for supporting relatives and one-time work-related death subsidies obtained by their close relatives in accordance with the regulations on work related injury insurance


6. Tax exemption for "three insurances and one fund" paid by units and individuals

CS [2006] No. 10: the basic endowment insurance premium, basic medical insurance premium and unemployment insurance premium actually paid by enterprises and institutions in accordance with regulations shall be exempted from individual income tax;The basic endowment insurance premium, basic medical insurance premium and unemployment insurance premium paid by an individual in accordance with regulations are allowed to be deducted from the individual's taxable income.

Within the range of no more than 12% of the average monthly wage of the employee in the previous year, the housing accumulation fund actually paid by the unit and individual is allowed to be deducted from the individual taxable income.


7. Tax exemption for "three insurances and one fund" withdrawn by individuals

CS [2006] No. 10: individual income tax is exempted when individual actually receives (disburses) the original basic endowment insurance, basic medical insurance, unemployment insurance and housing accumulation fund.


8. Exemption of maternity allowance

According to the notice of the Ministry of Finance and the State Administration of Taxation on individual income tax policies related to maternity allowance and maternity medical expenses (CS [2008] No. 8), the maternity allowance, maternity medical expenses or other subsidies in the nature of maternity insurance obtained by the people's government at or above the county level in accordance with the maternity insurance measures formulated by the people's government at or above the county levelSubsidies are exempt from individual income tax.


9. The subsidies and allowances paid in accordance with the unified provisions of the state are exempt from tax

According to Article 4 of the individual income tax law of the people's Republic of China, tax exemption is granted.Article 13 of the regulations on the implementation of the individual income tax law of the people's Republic of China stipulates that the subsidies and allowances provided by the state uniformly refer to the special government subsidies, academicians' allowances and senior academicians' allowances granted in accordance with the provisions of the State Council, as well as other subsidies and allowances exempted from individual income tax by the State Council.


10. Tax exemption for retirement and retirement expenses

According to Article 4 of the individual income tax law of the people's Republic of China, tax exemption is granted.Specific provisions: according to the unified provisions of the state, the resettlement fee, retirement fee, basic pension or retirement fee, retirement fee and living allowance for retired cadres and employees shall be paid;


11. The subsidies obtained by senior experts extending the retirement age from their units are tax-free

According to the notice of the Ministry of Finance and the State Administration of Taxation on several policy issues of individual income tax (Cai Shui Zi [1994] No. 20), senior experts who have reached the retirement age but have to extend the retirement age appropriately due to work needs (experts and scholars who enjoy special government subsidies issued by the state and academicians of the Chinese Academy of Sciences and Chinese Academy of Engineering) are required,Their income from wages and salaries during the extended period of retirement shall be regarded as retirement wages and wages, and shall be exempted from individual income tax.


12. 50% reduction in cash reward for post conversion of scientific and technological personnel

CS [2018] No. 58: non profit research and development institutions and institutions of higher learning approved to be established in accordance with the law of the people's Republic of China on promoting the transformation of scientific and technological achievements to scientific and technological personnel from the income from the transformation of scientific and technological achievements Cash reward 50% of the "wage and salary income" of scientific and technological personnel in the current month can be reduced and the individual income tax can be paid according to law.


13. There is no tax on the stock right award of scientific and technological personnel

Guo Shui Fa [1999] No. 125: scientific research institutions and institutions of higher learning transform their scientific and technological achievements into shares or investment proportion, etc Form of equity After the examination and approval of the competent tax authorities, the individual income tax will not be collected temporarily.


14. Salaries and allowances paid by the Asian Development Bank are exempt from tax

CS [2007] No. 93: for the salaries and allowances paid by the Asian Development Bank to Chinese citizens or nationals (including experts performing tasks for the ADB), those who are confirmed by the Asian Development Bank to be employees or project experts of the Asian Development Bank shall be exempted from individual income tax for their salaries and allowances in accordance with the provisions of China's tax law;


15. Tax exemption for military personnel's employment, demobilization and retirement benefits

Article 4 of the "individual income tax law" provides for tax exemption, item 6: transfer fee, demobilization fee and retirement pension for servicemen;


16. Thirteen military subsidies

According to the notice of the Ministry of Finance and the State Administration of Taxation on the collection of personal income tax on the salary income of military cadres (Cai Shui Zi [1996] No. 14), the following provisions are as follows: (1) special government subsidies;Welfare subsidies;Separation allowance for husband and wife;There was no subsidy for the family members of the army;Health care expenses for the only child;Child care and education subsidies;Public service expenses for cadres above the military level (nanny expenses);Subsidies for military grain price differences are tax-free items for military cadres or subsidies and allowances that do not belong to their own income, and are not subject to individual income tax.

(2) There are five kinds of subsidies and allowances not to be taxed temporarily: military professional allowance;Subsidies for difficult areas set up by the army;Professional subsidies;Post allowance for grass-roots officers (post allowance for battalion company platoon leader); food allowance.


17. The one-time retirement payment and one-time financial subsidy for retired soldiers are exempt from tax

Regulations on the placement of retired soldiers (Order No. 608 of the State Council of the people's Republic of China and the Central Military Commission of the people's Republic of China): for retired soldiers who are employed independently, the Army shall issue a one-time retirement payment, and the one-time retirement payment shall be specially arranged by the central finance;Local people's governments may, in accordance with the actual local conditions, give economic subsidies. The standards and methods of granting economic subsidies shall be formulated by the people's governments of provinces, autonomous regions and municipalities directly under the central government.The one-time retirement pension and one-time economic subsidies shall be exempted from individual income tax in accordance with state regulations.


18. Board expenses of ocean going crew

Guo Shui Fa [1999] No. 202: since the board expenses of crew members are uniformly used for group meals and are not distributed to individuals, this subsidy is allowed not to be included in the taxable wages and salaries of individual seafarers.


19. Half reduction of individual income tax for ocean going seafarers

treasury department Notice of the State Administration of Taxation No. 97 of 2019 :For ocean going seafarers who have spent 183 days in a tax year, their wages and salaries shall be included in the taxable income by 50%.


20. Subsidies for epidemic prevention and control are tax-free

treasury department Announcement No.0, 2020 of the State Administration of Taxation: individual income tax shall be exempted from the temporary work subsidies and bonuses obtained by medical personnel and epidemic prevention workers participating in epidemic prevention and control according to the standards set by the government.The standards stipulated by the government include the subsidies and bonus standards stipulated by the governments at all levels.The temporary work subsidies and bonuses for the personnel participating in epidemic prevention and control stipulated by the people's governments at or above the provincial level shall be implemented in comparison.It will be implemented from January 1, 2020, and the deadline will be announced separately according to the epidemic situation.


21. Protective equipment for preventing new crown issued by the unit

Announcement No.0, 2020 of the State Administration of Taxation of the Ministry of Finance: the drugs, medical supplies and protective articles (excluding cash) distributed by units to individuals for the prevention of new coronavirus infection shall not be included in wages and salaries, and shall be exempted from individual income tax.


22. Tax exemption for diplomatic personnel

Item 8, Article 4 of the individual income tax law of the people's Republic of China: the income of diplomatic representatives, consular officers and other personnel of embassies and consulates of various countries in China that are tax-free in accordance with relevant laws and regulations;


23. Tax exemption of eight subsidies for foreign personnel

Cai Shui Zi [1994] No. 20: the following income shall be exempted from individual income tax temporarily: (1) the income tax of foreign individuals shall be Non cash form or Form of reimbursement Housing subsidies, food subsidies, relocation costs, laundry expenses.(2) Subsidies for domestic and overseas business trips obtained by foreign individuals according to reasonable standards.(3) The expenses for visiting relatives, language training, children's education, etc. obtained by foreign individuals shall be regarded as reasonable after being examined and approved by the local tax authorities.


24. The wages and salaries of foreign experts from specific sources are exempt from tax

According to Cai Shui Zi [1994] No. 20, the income from wages and salaries obtained by foreign experts who meet one of the following conditions may be exempted from individual income tax:

1. Foreign experts directly sent by the world bank to work in China according to the special loan agreement of the world bank;

2. Experts directly sent by UN organizations to work in China;

3. Experts working in China for UN aid projects;

4. Experts sent by the donor country to China to work for the country's gratis aid projects;

5. The salary and salary income of cultural and educational experts who come to work in China for less than two years according to the cultural exchange projects signed by the two governments shall be borne by the country;

6. The salary and salary income of cultural and educational experts who come to work in China for less than two years according to the exchange program of colleges and universities in China shall be borne by the country;

7. For experts who come to work in China through nongovernmental scientific research agreements, their wages and salaries are borne by the government agencies of that country.


25. Tax differential subsidy for overseas talents

CS [2019] No. 31: from January 1, 2019 to December 31, 2023, Guangdong Province and Shenzhen city will provide subsidies to overseas (including Hong Kong, Macao and Taiwan, the same below) high-end talents and short-term talents working in Dawan district according to the difference of individual income tax burden between the mainland and Hong Kong, and the subsidy is exempt from individual income tax.


26. Tax exemption for foreign technical officials related to the Olympic Games

CS [2017] No.60: the labor remuneration paid by the Beijing Winter Olympic Organizing Committee and the Organizing Committee of test events shall be exempted from individual income tax on the remuneration of foreign technical officials, such as foreign consultants and referees, who come to China temporarily during the 2022 Winter Olympic Games, winter Paralympic Games and test games, who are invited by the Beijing Winter Olympic Organizing Committee and Beijing Olympic Games Organizing Committee, to engage in Olympic related work.


27. Tax exemption of subsidies in Tibet

Cai Shui Zi [1994] No. 021: individual income tax shall be exempted from individual income tax on allowances and floating wages in hard and remote areas, additional length of service wages, and resettlement and housing subsidies for retirees.

Cai Shui Zi [1996] No. 91: the staff and workers of organs and institutions working in the Tibet region, and the special allowance for Tibet obtained in accordance with the unified provisions of the state, shall be exempted from individual income tax.


28. The income of disabled orphans and martyrs' families is determined by each province

Article 5 of the individual income tax law of the people's Republic of China may be reduced under any of the following circumstances. The specific range and time limit shall be prescribed by the people's governments of provinces, autonomous regions and municipalities directly under the central government, and shall be reported to the Standing Committee of the people's congress at the same level for the record: income of disabled persons, orphans and martyrs' families.


29. Tax exemption of housing rental subsidy

treasury department Announcement No.61 of 2019 of the State Administration of Taxation "notice on preferential tax policies for public rental housing": the housing rental subsidies received from the local government by urban housing security families meeting the requirements specified by the local government shall be exempted from individual income tax.


30. The part within 3 times of the one-time compensation income for the termination of labor relations shall be exempted from tax

Article 5 of CS [2018] No. 164: the part of one-time compensation income (including economic compensation, living allowance and other subsidies) obtained by an individual and the employer after terminating the labor relationship with the employer shall be exempted from individual income tax if the amount is less than three times of the average wage of local employees in the previous year;The part over three times of the amount shall not be included in the current year's comprehensive income, and the comprehensive income tax rate table shall be separately applied to calculate tax payment. 


31. One time bankruptcy settlement fee exemption

CS [2001] No. 157: the enterprise is declared bankrupt in accordance with the relevant laws and regulations of the state, and the employees of the enterprise shall be exempted from individual income tax for the one-time income from the bankrupt enterprise.


32. Deferred tax payment for equity incentive of unlisted companies

CS [2016] No. 101: stock options, equity options, restricted stocks and equity awards granted by unlisted companies to the employees of the company, if they meet the specified conditions, can implement the deferred tax policy after filing with the competent tax authorities, that is, employees can temporarily refuse to pay tax when they obtain equity incentive, and defer to pay tax when transferring the equity.


33. The tax shall be suspended if the employee obtains the quantitative assets with ownership

Guo Shui Fa [2000] No.60: when a collective owned enterprise is transformed into a joint-stock cooperative enterprise, the relevant assets can be quantified to individual employees, and the individual income tax shall be suspended for the quantified assets of enterprises with ownership acquired by individual employees in the form of shares.






Advantages of Huacai

Industry leader
The first financial and taxation service agency landing on the new third board and the first fiscal and taxation platform providing online services
Qualification certification
It has the agency license issued by the Finance Bureau, the national high-tech enterprises, and the 5A level certification of the accounting agency of the general association of China
23 years of industry experience
300 + professional service staff, 20000 + customer service experience
ISO certification information security
Through the international ISO27001 information security management system standard certification
ISO certification standard management
Through the international ISO9001 quality management system certification
Service capability
The scope of service covers hot cities and hot areas