What is the meaning of the transfer of the right to use assets, and it is explained in layman s term

Enterprises lease out idle fixed assets and intangible assets to collect rent, which is the transfer of the right to use assets. It can also be defined as follows: it refers to the act of the owner of the asset temporarily transferring the right to use the asset to another person to obtain relevant benefits, but does not transfer the ownership of the asset.

For example, lending funds to others to collect interest on funds, etc.

The Enterprise Income Tax Law does not specifically stipulate the concept of income from the transfer of asset use rights. In terms of conceptual definition, there are the following similarities and differences:

1.The income from the transfer of the right to use assets stipulated in the accounting standards is different from the income from the transfer of property as stipulated in Article 6 (3) of the Enterprise Income Tax Law; The income from the transfer of property stipulated in the tax law refers to the income obtained by the enterprise from the transfer of fixed assets, biological assets, intangible assets, equity, creditor's rights, etc., which mainly refers to the income obtained from the transfer of property ownership, rather than the right to use.

2.The interest income in the income from the transfer of the right to use assets stipulated in the accounting standards is different from the interest income stipulated in Article 6 (5) of the Enterprise Income Tax Law; The interest income stipulated in the tax law refers to the interest income obtained by the enterprise from providing funds to others for use but not constituting equity investment or due to the occupation of the enterprise's funds by others, including deposit interest, loan interest, bond interest, arrears interest and other income.

3.The royalty income in the income from the transfer of the right to use assets stipulated in the accounting standards corresponds to the royalty income stipulated in Article 6 (7) of the Enterprise Income Tax Law; The royalty income stipulated in the tax law refers to the income obtained by enterprises from providing the right to use patent rights, non-patented technologies, trademark rights, copyrights and other concession rights.

It refers to the act of the owner of an asset temporarily transferring the right to use the asset to another person to obtain relevant benefits, but does not transfer the ownership of the asset.

For example, you can lend funds to others to collect interest on your funds.

To put it simply, if you give the right to use the asset to someone else, you can charge a certain rent (or not), but you just give the right to use to someone else, and the ownership is still yours! Others can only use it, and it must be returned in its entirety!!

The transfer of the right to use assets refers to the transfer of the right to use assets, and the royalty income from the transfer of the right to use assets mainly refers to the royalty income formed by the transfer of the right to use intangible assets and other assets by enterprises. The transfer of the right to use assets mainly includes: leasing intangible assets, leasing fixed assets, interest income from debt investment, and dividend income from equity investment.

The transfer of the right to use assets does not include: net income from the disposal of debt investments, net income from the disposal of equity investments, net income from the disposal of fixed assets, and net income from the disposal of intangible assets. The income from the transfer of the right to use assets mainly includes:

1) Interest income mainly refers to the interest income generated by external loans of financial enterprises, as well as the interest income generated by transactions between banks. (2) Royalty income mainly refers to the royalty income generated by the transfer of the right to use intangible assets (such as trademark rights, patent rights, franchise rights, software, copyrights) and other assets by enterprises. Royalty income shall be recognized in accordance with the time and method of charging agreed in the relevant contract or agreement:

If the contract or agreement stipulates that the royalty will be charged in a lump sum and no follow-up services are provided, it shall be regarded as a one-time recognition of revenue from the sale of the asset; If follow-up services are provided, the revenue shall be recognized in installments within the validity period specified in the contract or agreement. If the contract stipulates that the royalties shall be collected in installments, the income shall be recognized in installments according to the time and amount of collection specified in the contract or the amount calculated by the charging method specified in the contract.

The transfer of the right to use assets refers to the transfer of the right to use assets, and the royalty income from the transfer of the right to use assets mainly refers to the royalty income formed by the transfer of the right to use intangible assets and other assets.

The transfer of the right to use assets includes: lease of intangible assets, lease of fixed assets, interest income from debt investment, and dividend income from equity investment.

The transfer of the right to use assets does not include: net income from the disposal of creditor's rights and investment in rubber training assets, net income from the disposal of equity investments, net income from the disposal of fixed assets, and net income from the disposal of intangible assets.