2. The Circular on Issues Concerning the Deduction of Enterprise Salaries and Wages and Employee Welfare Expenses (Guo Shui Han [2009] No. 3) stipulates that the enterprise employee welfare expenses stipulated in Article 40 of the Implementing Regulations shall include the following:
(1) Equipment, facilities and personnel expenses incurred by the welfare departments of an enterprise that has not yet implemented the separation of the function of running a social organization, including the employee cafeteria, equipment, facilities and repair and maintenance costs of collective welfare departments such as staff bathrooms, barber's offices, medical clinics, nurseries, nursing homes, etc. and the wages and salaries, social insurance premiums, housing provident funds and labor costs of the staff of the welfare departments.
(2) Subsidies and non-monetary benefits for employees' health care, living, housing, transportation, etc., including medical expenses paid by the enterprise to employees for overseas medical treatment on official business, medical expenses for employees of enterprises that have not implemented medical coordination, medical subsidies for employees' dependent immediate family members, subsidies for heating expenses, heat-prevention and cooling expenses for employees, subsidies for employees' difficulties, relief expenses, subsidies for employees' canteens, and subsidies for employees' transportation. subsidies, etc.
(3) Other employee welfare expenses incurred in accordance with other regulations, including funeral subsidies, pension payments, settlement expenses, and travel expenses for family visits.
Employee welfare expenses accounting: employee welfare expenses incurred by the enterprise should be set up separate books for accurate accounting. If there is no separate account book for accurate accounting, the tax authorities shall order the enterprise to make corrections within the specified period. If no correction is made after the deadline, the tax authority may reasonably approve the employee welfare expenses incurred by the enterprise.
Third, according to the "State Administration of Taxation on the Announcement on Certain Tax Treatment Issues of Taxable Income for Enterprise Income Tax" (State Administration of Taxation Announcement No. 15 of 2012), "First, on the pre-tax deduction of seasonal workers, temporary workers and other expenses", the enterprise employs seasonal workers, temporary workers, trainees, retired personnel and accepts seasonal workers, temporary workers and interns, The expenses actually incurred by enterprises for hiring seasonal workers, temporary workers, interns, retired personnel and accepting external labor dispatch shall be differentiated into salary and wage expenses and employee welfare expenses, and shall be deducted before enterprise income tax in accordance with the provisions of the Enterprise Income Tax Law. The expenses on salaries and wages shall be included in the total amount of salaries and wages of the enterprise as the basis for calculating the deduction of other related expenses. The provisions of this announcement are applicable to the treatment of enterprise taxable income in 2011 and subsequent years.
D. According to the "Announcement of the State Administration of Taxation on Pre-tax Deduction of Expenditures on Wages, Salaries and Employee Welfare Fees of Enterprises" (Announcement of the State Administration of Taxation No. 34 of 2015), the welfare subsidies which are included in the wage and salary system of the enterprise and paid together with the wages and salaries are allowed to be counted as the base for calculating the deduction of all other related expenses. Welfare subsidies that are included in the enterprise's employee salary and wage system and are fixed and distributed together with salaries and wages, and that meet the provisions of Article 1 of the Circular of the State Administration of Taxation on Issues Concerning the Deduction of Wages, Salaries and Employee Welfare Expenses of Enterprises (Guo Shui Huan [2009] No. 3), may be regarded as the salary and wage expenses incurred by the enterprise, and may be deducted before tax according to the regulations. Welfare subsidies that cannot meet the above conditions at the same time shall be deducted before tax as employee welfare expenses as stipulated in Article 3 of Guo Shui Han [2009] No. 3 and calculated in accordance with the prescribed limits. This announcement is applicable to the 2014 and subsequent years' enterprise income tax remittance. Matters that have not been dealt with for tax purposes before the implementation of this announcement can be implemented in accordance with this announcement if they are in line with the provisions of this announcement.