Summary of Deduction Items and Standard for CIT in China(Continued 2)

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Summary of Deduction Items and Standard for CIT in China(Continued 2)

 

No. Deduction Items Standard of Deduction/Proportion of Limit Remark
32 Unverified provision Non-deductable  
33 Depreciation of fixed assets Deductable within the prescribed scope Not exceed the minimum period of depreciation
34 Depreciation of productive biological assets Deductable within the prescribed scope 10 years for woods, 3 years for livestock
35 Amortization of intangible assets Amortization period not less than 10 years General intangible assets
Amortizion based on the period stipulated by the law or contract Intangible assets obtained from investment or purchase
Non-deductable Goodwill created by the enterprise itself
Non-deductable Intangible assets irrelated to the business operation
36

 

 Long term deferred expense Deductable within the limit amount 1. The amortization for reconstruction expenses of buildings that have been fully depreciated shall be apportioned according to the estimated useful life
2.  The amortization for reconstruction expenses of leased building shall be apportioned according to the estimated useful life
3. The amortization for fixed assets repair expenses shall be apportioned according to the estimated useful life
4. For other long-term deferred expenses, the amortization period shall not be less than 3 years
37 Organization costs Deductable Deduct one-time in the year of commencement of  operation or amortized as long term deferred expense
38 Amortization of low value articles Actual amount  
39 Audit and notarial fees Actual amount  
40 R&D expense Additional deduction Additional deduction is allowed in annual CIT declaration for incurred R&D expense within the prescribed sope
41 Taxes Deductable CIT and VAT can’t be deducted
42 Consulting and legal costs Actual amount  
43 Business trip expense Actual amount  
44 Meeting expense Actual amount Meeting minites and other supporting documents are required
45 Work dress expense Actual amount  
46 Transportation, installation, packing and other expenses Actual amount  
47 Printing expense Actual amount  
48 Courier and mail expense Actual amount  
49 Rental expense Actual amount  
50 Water and electricity expense Actual amount  
51 Heating/cooling costs Calculated as welfare Adjustment is needed when the welfare amount exceed the statutary standard
52 Fuel costs of vehicle and vessel Actual amount  
53 Allowances for employees for transportation and meal Actual amount  
54 Repair and maintenance fees Actual amount  
55 Security expense Actual amount  
56 Expenses of board of directors Actual amount  
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