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Notice of the Ministry of Finance and State Administration of Taxation on Several Preferential Policies in Respect of Enterprise Income Tax (No. 1  of the Ministry of Finance) makes clear and definite provisions that enterprise income tax policy of “two-year exemption and three-year half reduction” and value added tax policy of immediate refund of above 3% upon payment are still effective after issuing new enterprise income tax. The development of software enterprises relies on the tax preference policies. Therefore, knowing the tax preference policies well to obtain the maximum tax interest is significant to development of software enterprises.
Tips for tax preference:
■ value added tax:
The general taxpayers of value added tax shall duly pay tax at the statutory rate of 17% when selling software products developed by themselves. Then, the tax authority shall give immediate refund of the payment part of which is more than 3% of the actual tax burden. The refund shall be used on researching and developing the software products and enlarging reproduction and it shall not be considered as taxable income to collect enterprise income tax.
■ enterprise income tax:
A software production enterprise newly established within China may, upon determination, be exempted from enterprise income tax for its first two profit-making years and shall be subject to the income tax at the reduced half rate from the third year to the fifth year.
■ key software production enterprises included in the national plan:
If a key software production enterprise included in the national plan does not enjoy the preferential treatment of tax exemption in the current year, it shall be subject to the enterprise income tax at the reduced rate of 10%.
■ The actual amount of the salaries and employee training expenses of a software production enterprise may be deducted in the calculation of the amount of taxable income.
■An integrated circuit design enterprise shall be regarded as a software enterprise, which may enjoy the relevant enterprise income tax policies enjoyed by the aforesaid software enterprises.
Scope of our service:
HWUASON concentrates on tax preference policies of high-tech enterprises and can assist enterprises to gain the maximal tax interests legally. During the applying for determination of software product and software enterprise, HWUASON can offer services as follows:
■ replying the questions of clients;
■ assessing the feasibility of the determination of software product and software enterprise;
■ plotting the software copyright;
■ assisting to prepare relevant materials;
■ adjusting and compiling applying materials;
■ assisting to obtain the qualification certificate of software product and software enterprise;
■ applying for treatment according to tax preference policies.
Value of our services:
■ improving the efficiency and enjoy the preferential policy of exempting business taxes in accordance with law;
■ planning before declaration to avoid the tax risks.