What are the two exemptions and three reductions for high tech software?

1) If a resident enterprise is recognized as a high-tech enterprise, and at the same time is in the transitional period of regular tax reduction and exemption such as "two exemptions and three halves" and "five exemptions and five halves" of enterprise income tax as stipulated in the third paragraph of Article 1 of the Notice on the Implementation of Transitional Preferential Policies for Enterprise Income Tax (Guo Fa [2007] No. 39), the applicable tax rate of the resident enterprise can choose to apply the applicable tax rate during the transition period and apply half of the tax rate until the expiration, or choose to apply the 15% tax rate of high-tech enterprises. However, it is not eligible for a halved tax rate of 15%.

2) If a resident enterprise is recognized as a high-tech enterprise and at the same time meets the preferential conditions for the regular halving of enterprise income tax by software production enterprises and integrated circuit production enterprises, the applicable income tax rate of the resident enterprise can choose to apply the 15% tax rate of the high-tech enterprise, or it can choose to be taxed at half of the statutory tax rate of 25%, but cannot enjoy the half-tax rate of the 15% tax rate.

3) The income obtained by a resident enterprise that can be reduced by half as stipulated in Articles 86, 87, 88 and 90 of the Regulations for the Implementation of the Enterprise Income Tax Law of the People's Republic of China means that the resident enterprise shall separately account for this part of the income and pay the enterprise income tax at half of the statutory tax rate of 25%.

4) The preferential tax rate reduction for high-tech enterprises is a continuation of the policy of changing the applicable conditions and is not included in the transitional policy, therefore, if a resident enterprise has been approved by the tax authorities to enjoy the preferential enterprise income tax for high-tech enterprises or new technologies in 2007 and before, and has not been recognized as a high-tech enterprise in 2008 and subsequent years, the 15% tax rate for high-tech enterprises shall not be applied since 2008, nor shall the Notice on the Implementation of Transitional Preferential Policies for Enterprise Income Tax (Guo Fa [2007] No. 39) shall be subject to the statutory tax rate of 25% from 2008 onwards.

Beijing Tiantuo Lixing Consulting ****, high-tech certification expert, Manager Chen.

According to the notice of the Ministry of Finance and the State Administration of Taxation on several preferential policies for enterprise income tax (Cai Shui Zi 1994 No. 1), after the review of the tax authorities, eligible enterprises can be given tax reduction or tax exemption preferences according to the regulations: enterprises in the approved high-tech industrial development zone, identified as high-tech enterprises by relevant departments, can be levied income tax at a reduced rate of 15; Newly established high-tech enterprises in the approved high-tech industrial development zones shall be exempted from income tax for two years from the year of operation. In addition, according to the notice of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs on policy issues related to encouraging the development of the software industry and the integrated circuit industry (CS 2000 No. 25), after the identification of new software production enterprises in China, from the beginning of the profit year, the first and second years are exempted from enterprise income tax, and the enterprise income tax is reduced by half from the third to the fifth year.

For the newly established high-tech enterprises that have been identified as new software production enterprises and are also approved by the State Administration of Taxation in the high-tech industrial development zone, their tax incentives shall be implemented in accordance with Article 4 of the Notice of the State Administration of Taxation on Issues Concerning the Implementation of Relevant Provisions on the Relevant Provisions of the Preferential Income Tax Policies for Software Enterprises and High-tech Enterprises (Guo Shui Fa 2003 No. 82). Newly established high-tech enterprises in approved high-tech industrial development zones can enjoy tax reduction and exemption for newly established software production enterprises. During the tax reduction period, the corporate income tax will be levied at half of the 15% tax rateAfter the expiration of the tax reduction and exemption period, the enterprise income tax will be levied at a rate of 15%. In other words, from the beginning of the profit year, the first and second years are exempted from corporate income tax, and the third to fifth years are subject to corporate income tax at half the rate of 15%.

After the expiration of the tax reduction and exemption period, the enterprise income tax shall be levied according to the applicable tax rate of 15 for high-tech enterprises in the high-tech industrial development zone.

The policy of "two exemptions and three reductions" means that foreign-invested enterprises can enjoy the treatment of exemption from enterprise income tax for 2 years and halved for 3 years from the year of profit. For foreign-invested enterprises encouraged by the state located in the central and western regions, after the expiration of the five-year tax reduction and exemption period, the income tax can be extended for three years to be reduced by half. Advanced technology-based enterprises established with foreign investment can enjoy tax exemption for 3 years and enterprise income tax treatment reduced by half for 6 yearsFor export-oriented enterprises, in addition to enjoying the above-mentioned two exemptions and three reductions of income tax, as long as the annual export volume of the enterprise accounts for more than 70% of the total sales of the enterprise, it can enjoy the preferential treatment of enterprise income tax reduced by half;If a foreign-invested enterprise purchases domestic equipment within the total investment amount, if such imported equipment falls within the scope of the import tax exemption catalogue, it can be credited with enterprise income tax according to regulations.

What Scope of Foreign Investment Encouraged by the State and What Preferential Measures Are Granted to These Encouraged Categories China mainly encourages foreign investment in the following areas: First, foreign investment is encouraged to transform traditional agriculture, develop modern agriculture, and promote agricultural industrialization. The second is to encourage foreign investment in infrastructure and basic industries such as transportation, energy, and raw materials.

The third is to encourage foreign investment in high-tech industries such as electronic information, bioengineering, new materials, and aerospace, and encourage foreign investors to set up R&D centers in China. Fourth, foreign businessmen should be encouraged to use advanced and applicable technologies to transform traditional industries such as machinery, light industry, and textiles, so as to realize the upgrading of the equipment industry. Fifth, foreign investors are encouraged to invest in the comprehensive utilization of resources and renewable resources, environmental protection projects and municipal projects.

Sixth, in line with the strategy of large-scale development of the western region, foreign investors should be encouraged to invest in the advantageous industries in the western region. Seventh, it is a permitted project to encourage the export of all foreign-invested products.

High-tech enterprises can also enjoy the regular tax incentives of "two exemptions and three halves" (from the tax year in which the first production and operation income is obtained, the enterprise income tax is exempted from the first to the second year, and the enterprise income tax is levied at half of the statutory rate of 25% from the third to the fifth year).

(1) If a resident enterprise is recognized as a high-tech enterprise, and at the same time is in the transitional period of regular tax reduction and exemption such as "two exemptions and three halves" and "five exemptions and five halves" as stipulated in the third paragraph of Article 1 of the Notice on the Implementation of Transitional Preferential Policies for Enterprise Income Tax (Guo Fa [2007] No. 39), the applicable tax rate of the resident enterprise can choose to apply the applicable tax rate during the transition period and apply the halved tax rate until the expiration, or choose to apply the 15% tax rate of high-excitation and new technology resistant enterprises. However, it cannot enjoy the 15% tax rate and the halved tax rate next spring.

2) If a resident enterprise is recognized as a high-tech enterprise and at the same time meets the preferential conditions for the regular halving of enterprise income tax by software production enterprises and integrated circuit production enterprises, the applicable income tax rate of the resident enterprise can choose to apply the 15% tax rate of the high-tech enterprise, or it can choose to be taxed at half of the statutory tax rate of 25%, but cannot enjoy the half-tax rate of the 15% tax rate.

3) The income obtained by a resident enterprise that can be reduced by half as stipulated in Articles 86, 87, 88 and 90 of the Regulations for the Implementation of the Enterprise Income Tax Law of the People's Republic of China means that the resident enterprise shall separately account for this part of the income and pay the enterprise income tax at half of the statutory tax rate of 25%.

4) The preferential tax rate reduction for high-tech enterprises is a continuation of the policy of changing the applicable conditions and is not included in the transitional policy, therefore, if a resident enterprise has been approved by the tax authorities to enjoy the preferential enterprise income tax for high-tech enterprises or new technologies in 2007 and before, and has not been recognized as a high-tech enterprise in 2008 and subsequent years, the 15% tax rate for high-tech enterprises shall not be applied since 2008, nor shall the Notice on the Implementation of Transitional Preferential Policies for Enterprise Income Tax (Guo Fa [2007] No. 39) shall be subject to the statutory tax rate of 25% from 2008 onwards.

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At present, there are more and more enterprises applying for the identification of high-tech enterprises, the main reason is to see the advantages and benefits brought by the policy of two exemptions and three halves of high-tech enterprises to the development of enterprises, and it will be of great help to enterprises to enhance their brand image and competitiveness.

1. The policy of halving in two years.

The two exemptions and three halves of high-tech enterprises refer to the fact that high-tech enterprises can be exempted from enterprise income tax within the scope of two years of the tax year in which the first income is obtained, and the enterprise income tax treatment will be reduced by half for three years. This can greatly reduce the pressure of corporate income tax and increase the operating profit of the enterprise.

2. Apply for the advantages of high-tech enterprise recognition.

By applying for the recognition of high-tech enterprises, enterprises can enjoy preferential policies such as two exemptions and three halves of high-tech enterprises, especially to improve the core competitiveness and brand image of enterprises in the entire industry, and make the competitive advantage more obvious. In the future business development, we can also enjoy more support policies.

3. Requirements for high-tech enterprises to apply for identification.

Although applying for the recognition of high-tech enterprises can enjoy preferential policies such as two exemptions and three halves for high-tech enterprises, of course, the premise is to determine the relevant requirements and principles for applying for recognition, and clarify whether your enterprise meets the relevant conditions and requirements. Then fill in the declaration form according to the prescribed standards and wait for the specific review process.

If you want to enjoy preferential tax policies, it is recommended to apply for the recognition of high-tech enterprises in a reasonable and legal way, and understand the relevant requirements and principles of high-tech enterprise identification, so that you can naturally prepare in advance and promote the approval rate of the application.

Haishi Intellectual Property is committed to the field of intellectual property services, providing customers with professional and integrated intellectual property solutions, covering a full range of intellectual property services such as patents, trademarks, copyright registration, patent transfer, trademark transfer and blind ignition, project declaration, etc.

Nowadays, there are more and more enterprises applying for the recognition of high-tech enterprises, the main reason is that the advantages and benefits of the policy of two exemptions and three halves of high-tech enterprises on the development of enterprises, and it will be of great help to enterprises to improve their brand image and competitiveness.

1. About the two-year three-halving policy.

The two exemptions and three halves of high-tech enterprises refer to the fact that high-tech enterprises can be exempted from enterprise income tax within two years of the tax year in which they obtain their first income, and the enterprise income tax treatment will be reduced by half for three years. This can greatly reduce the pressure of corporate income tax and increase the operating profit of the enterprise.

2. Apply for the advantages of high-tech enterprise recognition.

By applying for the recognition of high-tech enterprises, enterprises can enjoy preferential policies such as two exemptions and three halves of high-tech enterprises, especially to improve the core competitiveness and brand image of enterprises in the entire industry, and make the competitive advantage more obvious. In the future business development, we can also enjoy more support policies.

3. Requirements for high-tech enterprises to apply for identification.

Although applying for the recognition of high-tech enterprises can enjoy preferential policies such as two exemptions and three halves of high-tech enterprises, the premise is to clarify the specific requirements and principles for applying for recognition and determine whether their enterprises meet the relevant conditions and requirements. Then fill in the declaration form according to the prescribed standards and wait for the specific review process.

If you want to enjoy preferential tax policies, it is recommended to apply for the identification of high-tech enterprises in a reasonable and legal way, and understand the specific requirements and principles of high-tech enterprise identification, so that you can naturally prepare in advance and promote the success rate of applying for identification.

Measures for the Administration of Tax Reduction and Exemption (Trial) Regulations: Software development enterprises must meet the following conditions at the same time:

1) Obtain the software enterprise certification issued by the provincial information industry authority.

2) Computer software development and production, system integration, application services and other corresponding technical services as the main business, simply engaged in the first enterprise shall not enjoy.

3) Have more than one software product developed by the enterprise or owned by the enterprise, or provide computer information system integration and other services that have passed the qualification level and recognized the world certificate.

4) Have the technical equipment and business chaos places required for software development and corresponding technical services.

5) The proportion of technical personnel engaged in software product development and technical services in the total number of employees of the enterprise shall not be less than 50%.

6) The R&D expenditure of software technology and products accounts for more than 8% of the company's software revenue.

7) The annual software sales revenue accounts for more than 35% of the total annual revenue of the enterprise, of which the self-produced software revenue accounts for more than 50% of the software sales revenue.

According to the provisions of Article 22 of the Notice of the Ministry of Finance and the State Administration of Taxation on Further Encouraging the Development of the Software Industry and the Integrated Circuit Industry Enterprise Income Tax Policy (CS 2012 No. 27), if there is an overlap between the preferential enterprise income tax policies that integrated circuit production enterprises, integrated circuit design enterprises, and software enterprises can enjoy in accordance with the provisions of this notice and other preferential policies in the same way of enterprise income tax, the enterprise shall choose the most preferential policy for implementation and shall not be superimposed.

Therefore, the tax incentives for small and low-profit enterprises and the two exemptions and three halves for software enterprises shall not be enjoyed at the same time.