There seem to be some misunderstandings in the understanding of small and low-profit enterprises. Many people think that only small-scale taxpayers can be called small and low-profit enterprises and enjoy preferential tax policies. However, this is not the case.
In fact, if general taxpayers meet the three conditions of small and low-profit enterprises, they can also enjoy the corresponding preferential tax policies. These companies are often referred to as "small and micro enterprises".
As financial professionals, no matter how different the industry we are in, we must grasp the specific meaning of the three numbers "335" often said in the accounting industry, as well as the corresponding tax incentives. Only in this way can we better provide financial advice to enterprises and ensure that they can fully enjoy the benefits of tax policies.
Number of employees
According to Announcement No. 12 of 2023 of the Ministry of Finance and the State Administration of Taxation, we have learned the following two key information:
First of all, for enterprises that meet the conditions of small and micro enterprises, their corporate income tax rate policy will be extended until 2027. The applicable corporate income tax rate for small and micro enterprises is levied at 25% of the normal tax rate minus 20%, that is, the effective tax rate is 25% * 20% = 5%. This policy adjustment provides a more stable tax environment for small and micro enterprises, which helps to promote their sustainable development.
Secondly, in order to enjoy this preferential tax policy, the industry in which the enterprise is engaged must be in a field that is not restricted or prohibited by the state, and must meet the three major conditions of small enterprises corresponding to "335" at the same time. Specifically, the number of employees in an enterprise shall not exceed 300. The number of employees referred to here includes two parts: one is the number of employees who have established labor relations with the enterprise, and the other is the number of employees who accept labor dispatch from the enterprise.
It is important to note that when calculating the number of employees, we use the method of calculating the quarterly average. The quarterly average is calculated by adding the beginning of the quarter and the end of the quarter and dividing by 2, while the quarterly average for the year is calculated by adding the average of each quarter of the year and dividing it by 4. This provision ensures the fairness and accuracy of the tax policy, and avoids the impact of seasonal fluctuations or temporary employment and other factors on the tax treatment of enterprises.
Annual taxable income.
The annual taxable income is an important indicator when calculating corporate income tax, and there is a certain relationship between it and the total profit. The annual taxable income is actually the total profit plus the tax increase, minus the tax adjustment. This means that if the enterprise is not involved in the increase or decrease of tax payment, then the annual taxable income is equal to the total profit in the accounting statement.
For example, if the data of enterprise A is negative in the final settlement of enterprise income tax in 2022, then even if the enterprise starts to make a profit in 2023, it will not necessarily involve the payment of enterprise income tax. This is because losses can be deducted in subsequent tax years.
In addition, if the company's tax year 2022 return has been filed normally and the data is accurate, then when filling out the 2023 return, the tax system will automatically bring in the loss value of the previous year. If the result is still a loss, then there will be no corporate income tax payment in that year.
Total assets.
Total assets are an important indicator when assessing the size of a business and its compliance with tax incentives. According to the provisions in "335", the total assets shall not exceed 50 million yuan. This total asset usually refers to the total assets at the bottom left of the balance sheet, including current and non-current assets.
It is important to note that the calculation of total assets is the same as that of the number of employees. We use quarterly averages to get an accurate value of total assets. The quarterly average is calculated by adding the beginning of the quarter and the end of the quarter and dividing by 2, while the quarterly average for the year is calculated by adding the average of each quarter of the year and dividing it by 4.
When filling in the annual corporate income tax return (i.e., the annual tax return), we need to complete the corresponding data of the enterprise, including the number of employees, total profit and total assets. If the returns for the first three quarters of the year are all normal declarations, the system will automatically calculate the average number of employees and total assets. We just need to double that these values are accurate.