Measures for pre tax deduction of the hottest ente

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These measures are formulated in accordance with the spirit of the Interim Regulations of the people's Republic of China on enterprise income tax and its implementation rules (hereinafter referred to as the "Regulations" and "detailed rules")

Article 4 of the second regulation stipulates that the taxable income is the balance of the total income of the taxpayer in each tax year minus the allowable deductions. The allowable deduction items are all necessary and normal costs, expenses, taxes and losses incurred by the taxpayer in each tax year related to the acquisition of taxable income

Article 3 the deduction of excess declaration of taxpayer products shall be true and legal. Authenticity refers to the ability to provide appropriate evidence to prove that the relevant expenditure has actually occurred; Legality refers to compliance with national tax regulations. If other regulations are inconsistent with the provisions of tax regulations, the provisions of tax regulations shall prevail

Article 4 unless otherwise stipulated in tax laws and regulations, the recognition of pre tax deductions shall generally follow the following principles:

(I) accrual basis. That is, the taxpayer should confirm the deduction when the expense occurs rather than when it is actually paid

(II) matching principle. That is, the expenses incurred by taxpayers should be deducted in the current declaration where the expenses should be matched or allocated. The deductible expenses that should be declared by taxpayers in a tax year shall not be declared and deducted in advance or after the ocean freight from Brazil to China is 9.145 US dollars/ton

(III) correlation principle. That is, the deductible expenses of taxpayers must be related to the taxable income from the nature and source

(IV) certainty principle. That is, the amount of expenses that taxpayers can deduct must be determined whenever they are paid

(V) principle of rationality. That is, the calculation and distribution method of deductible expenses of taxpayers should conform to general business practices and accounting practices

Article 5 the expenses incurred by taxpayers must be strictly distinguished between operating expenses and capital expenses. Capital expenditure shall not be directly deducted in the current period, but must be depreciated, amortized or included in the cost of relevant investment in accordance with the provisions of tax laws and regulations

Article 6 in addition to the provisions of Article 7 of the regulations, the following expenditures shall not be deducted when calculating the taxable income:

(1) illegal expenditures such as bribery

(2) fines, fines and late fees paid for violating laws and administrative regulations

(III) inventory depreciation reserves, short-term investment depreciation reserves, long-term investment impairment reserves, risk reserve funds (including investment risk reserve funds), and reserves in any form other than those that can be withdrawn according to national tax regulations

(IV) tax regulations have specific deduction scope and standards (proportion or amount), and the actual expenses exceed or exceed the statutory scope and standards

Article 7 taxpayers who cannot leave the experimental site halfway shall follow the principle of historical cost in determining the cost of inventory, fixed assets, intangible assets, investment and other assets. If the taxpayer has reorganization activities such as merger, division and capital structure adjustment, and the implied appreciation or loss of relevant assets has been recognized and realized in tax, the cost of relevant assets can be determined according to the value after evaluation and confirmation

Chapter II costs and expenses

Article 8 costs refer to the costs of taxpayers selling goods (products, materials, leftovers, waste materials, etc.), providing labor services, transferring fixed assets and intangible assets (including technology transfer)

Article 9 taxpayers must reasonably divide the costs incurred in business activities into direct costs and indirect costs. Direct costs are direct materials and direct labor that can be directly included in the operating costs of relevant cost calculation objects or services. Indirect cost refers to the common cost that multiple departments provide services for the same cost object, or the joint cost that the same input can manufacture and provide two or more products or services

the direct cost can be determined according to the relevant meeting

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