Chapter II Taxable Income
Section II Income
Article 12 The monetary forms in which an enterprise obtains income as referred to in Article 6 of the EIT Law include cash, deposits, accounts receivable, notes receivable, investments in bonds intended to be held to maturity, and waivers of debts.
The non-monetary forms in which enterprises obtain income, as referred to in Article 6 of the Enterprise Income Tax Law, include fixed assets, biological assets, intangible assets, equity investments, inventories, investments in bonds not intended to be held to maturity, labor services, and related interests.
Article 13 Income in non-monetary form acquired by an enterprise referred to in Article 6 of the Enterprise Income Tax Law shall be determined in accordance with the fair value of the amount of income.
The fair value referred to in the preceding paragraph means the value determined in accordance with the market price.
Article 14 The revenue from the sale of goods referred to in Article 6 (1) of the Enterprise Income Tax Law refers to the revenue obtained by an enterprise from the sale of commodities, products, raw materials, packages, low-value consumables and other inventories.
Article 15: The income from the provision of labor services referred to in Article 6(2) of the Enterprise Income Tax Law refers to the income derived from the enterprise's activities of construction, installation, repair, transportation, warehousing and leasing, finance and insurance, postal and telecommunication, consulting and brokering, culture and sports, scientific research, technical services, education and training, catering and lodging, intermediary agency, health care, community service, tourism, entertainment, processing and other labor service activities. Income from service activities.
Article 16 The income from the transfer of property referred to in Article 6(3) of the Enterprise Income Tax Law refers to the income derived from the transfer of fixed assets, biological assets, intangible assets, equity and debts.
Article 17 Income from equity investments such as dividends and bonuses, as referred to in Item (4) of Article 6 of the Enterprise Income Tax Law, refers to the income obtained by an enterprise from the invested party due to equity investments.
Dividends, dividends and other equity investment income, except as otherwise provided by the competent departments of finance and taxation under the State Council, shall be recognized as the realization of income in accordance with the date on which the investee makes a decision on profit distribution.
Article 18 The interest income referred to in Article 6 (5) of the Enterprise Income Tax Law refers to the income obtained by an enterprise by providing funds to others for use but not constituting equity investment, or due to the occupation of the enterprise's funds by others, including interest on deposits, interest on loans, interest on bonds, and interest on arrears, and other incomes.
Interest income, according to the contractual agreement of the debtor to pay interest on the date to recognize the realization of income.
Article 19 The rental income referred to in Article 6 (6) of the Enterprise Income Tax Law refers to the income obtained by an enterprise by providing the right to use fixed assets, packages or other tangible assets.
Rental income, the realization of income is recognized in accordance with the date agreed in the contract that the lessee pays the rent.
Article 20 The royalty income referred to in Item (7) of Article 6 of the Enterprise Income Tax Law refers to the income obtained by an enterprise by providing the right to use patents, non-patent technologies, trademarks, copyrights and other franchises.
Royalty income is recognized as the realization of income in accordance with the date on which the royalty is payable by the royalty user as agreed in the contract.
Article 21 The income from accepting donations referred to in Article 6 (8) of the Enterprise Income Tax Law refers to the monetary assets and non-monetary assets accepted by an enterprise from other enterprises, organizations or individuals that are given free of charge.
Revenue from accepting donations is recognized as the realization of revenue according to the date of actual receipt of the donated assets.
Article 22 The other income referred to in Article 6(9) of the Enterprise Income Tax Law refers to the income obtained by an enterprise other than the income stipulated in Article 6(1) to (8) of the Enterprise Income Tax Law, including the income from overflow of enterprise assets, the income from deposits for overdue packages, the payables which are really unable to be reimbursed, the receivables which are recovered after having been dealt with as a loss of bad debts, the income from debt restructuring, the income from subsidies, the income from default payments, and the income from the reimbursements of the debts which are not reimbursable. Income, subsidy income, liquidated damages income, exchange gains and so on.
Article 23 The following production and operation businesses of an enterprise may recognize the realization of revenue in installments:
(1) If the goods are sold by installment collection, the realization of revenue shall be recognized in accordance with the collection date agreed in the contract;
(2) If an enterprise is entrusted with the processing and manufacturing of large-scale machinery and equipment, ships, airplanes, as well as engaging in the business of construction, installation and assembly works, or providing other labor services, etc., the duration of which exceeds 12 years, the enterprise shall be entitled to receive the revenue in installments. labor services, etc., the duration of which exceeds 12 months, the realization of revenue is recognized in accordance with the progress of completion or the amount of work completed during the taxable year.
Article 24 Where income is obtained by way of product sharing, the realization of income shall be recognized in accordance with the date on which the enterprise gets a share of the products, and the amount of income shall be determined in accordance with the fair value of the products.
Article 25 If an enterprise engages in the exchange of non-monetary assets, or uses goods, property or services for the purpose of donation, debt repayment, sponsorship, fund-raising, advertisement, samples, employee benefits or profit distribution, it shall be regarded as the sale of goods, the transfer of property or the provision of services, unless otherwise provided by the competent departments in charge of finance and taxation of the State Council.
Article 26 The financial allocation referred to in Article 7(1) of the Enterprise Income Tax Law refers to the financial funds allocated by the people's governments at all levels to the institutions, social organizations and other organizations included in the budget management, unless otherwise provided by the State Council and the competent departments in charge of finance and taxation under the State Council.
Administrative fees, as referred to in Article 7(2) of the EIT Law, refer to the fees charged to specific objects and included in the financial management in accordance with the laws and regulations and other relevant provisions, and approved in accordance with the procedures stipulated by the State Council, in the course of implementing the management of the social public ****, as well as in the process of providing specific public **** services to citizens, legal persons or other organizations.
Governmental funds, as referred to in Article 7(2) of the Enterprise Income Tax Law, are financial funds with special purposes collected by an enterprise on behalf of the government in accordance with laws, administrative regulations and other relevant provisions.
Other non-taxable incomes stipulated by the State Council, as referred to in Article 7(3) of the Enterprise Income Tax Law, refer to the financial funds obtained by the enterprise, which are stipulated by the competent departments of the State Council in charge of finance and taxation for special purposes and approved by the State Council.