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Dalian accounting firm reminds you of the big market of preferential tax policies due at the end of 2021!

2021-12-06

Tax preferential policies due at the end of 2021



01


value added tax

1. For small-scale VAT taxpayers, 3% of the taxable sales revenue will be applied, and the VAT will be levied at the reduced rate of 1%;For VAT items with 3% prepayment rate, VAT shall be paid in advance at the rate of 1%.Preferential period: April 1, 2021 to December 31, 2021 policy basis: announcement of the State Administration of Taxation of the Ministry of Finance on extending the preferential policies for taxes and fees in response to the epidemic situation (Announcement No. 7 of 2021 of the State Administration of Taxation of the Ministry of Finance)

2. The income obtained by taxpayers in providing film projection services shall be exempted from VAT.The term "film projection service" refers to the film audio-visual service provided by the unit holding the "film projection business license" for the audience by using professional cinema projection equipment.Preferential period: January 1, 2021 to December 31, 2021 policy basis: announcement of the State Administration of Taxation of the Ministry of Finance on extending the preferential policies for taxes and fees in response to the epidemic situation (Announcement No. 7 of 2021 of the State Administration of Taxation of the Ministry of Finance)

02


individual income tax

1. The temporary work subsidies and bonus obtained by the medical staff and epidemic prevention workers participating in the epidemic prevention and control work according to the standards stipulated by the government shall be exempted from individual income tax.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.Preferential period: January 1, 2021 to December 31, 2021 policy basis: announcement of the State Administration of Taxation of the Ministry of Finance on extending the preferential policies for taxes and fees in response to the epidemic situation (Announcement No. 7 of 2021 of the State Administration of Taxation of the Ministry of Finance)

2. 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.Preferential period: January 1, 2021 to December 31, 2021 policy basis: announcement of the State Administration of Taxation of the Ministry of Finance on extending the preferential policies for taxes and fees in response to the epidemic situation (Announcement No. 7 of 2021 of the State Administration of Taxation of the Ministry of Finance)

3. If the equity incentive such as stock option, stock appreciation right, restricted stock and equity incentive obtained by individual residents meet relevant regulations, they shall not be included in the current year's comprehensive income before December 31, 2021, and the comprehensive income tax rate table shall be applied to the full amount of equity incentive.The equity incentive policy after January 1, 2022 will be specified separately.Policy basis: Notice on the convergence of preferential policies after the amendment of individual income tax law (CS [2018] No. 164)

4. Foreign individuals who meet the personal conditions of residents can choose to enjoy the special additional deduction of individual income tax from January 1, 2019 to December 31, 2021, or enjoy the tax-free preferential policies of housing subsidies, language training fees, children's education fees and other subsidies according to the regulations, but not at the same time.Once a foreign individual has been selected, it shall not be changed within a tax year.From January 1, 2022, foreign individuals will no longer enjoy the tax-free preferential policies of housing subsidies, language training fees, children's education subsidies, and should enjoy special additional deduction according to regulations.Policy basis: Notice on the convergence of preferential policies after the amendment of individual income tax law (CS [2018] No. 164)



03


corporate income tax

The longest carry forward period for the losses of film industry enterprises in 2020 will be extended from 5 years to 8 years;

Enterprises in the film industry are limited to those engaged in film production, distribution and projection, excluding those that disseminate films through information networks such as the Internet, telecommunications networks, radio and television networks.Preferential period: from January 1, 2020 to December 31, 2021. Policy basis: Announcement on tax support policies for film and other industries (Announcement No. 25 of 2020 by the State Administration of Taxation of the Ministry of Finance), and notice of the State Administration of Taxation of the Ministry of Finance on continuing the implementation of preferential tax policies in response to the epidemic situation (Announcement No. 7 of 2021 of the State Administration of Taxation of the Ministry of Finance)



04


Construction cost of cultural undertakings

Cultural construction fee will be exempted.Preferential period: January 1, 2021 to December 31, 2021 policy basis: announcement of the State Administration of Taxation of the Ministry of Finance on extending the preferential policies for taxes and fees in response to the epidemic situation (Announcement No. 7 of 2021 of the State Administration of Taxation of the Ministry of Finance)


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