The scope of R&D expenses that allow super deduction includes:
1. Personnel expenses.
Salaries, basic pension insurance premiums, basic medical insurance premiums, unemployment insurance premiums, work-related injury insurance premiums, maternity insurance premiums and housing provident funds for personnel directly engaged in R&D activities, as well as labor costs for external R&D personnel.
2. Direct investment costs.
(1) Material, fuel and power costs directly consumed by R&D activities.
(2) Development and manufacturing fees for molds and process equipment used for intermediate testing and product trial production, purchase fees for samples, prototypes and general testing methods that do not constitute fixed assets, and inspection fees for trial production products.
(3) The cost of operation, maintenance, adjustment, inspection, repair and other expenses of instruments and equipment used for R&D activities, as well as the rental fees of instruments and equipment rented for R&D activities through operating leases.
3. Depreciation expenses.
Depreciation of instruments and equipment used for research and development activities.
4. Amortization of intangible assets.
Amortization expenses for software, patents, and non-patented technologies (including licenses, proprietary technologies, design and calculation methods, etc.) used for research and development activities.
5. New product design fees, new process procedure formulation fees, clinical trial fees for new drug development, and field test fees for exploration and development technology.
6. Other related expenses.
Other expenses directly related to R&D activities, such as technical book materials fees, data translation fees, expert consulting fees, high-tech R&D insurance premiums, retrieval, analysis, evaluation, demonstration, appraisal, and review of R&D results , evaluation, acceptance fees, intellectual property application fees, registration fees, agency fees, travel expenses, conference fees, etc. The total amount of this expense shall not exceed 10% of the total amount of R&D expenses that can be super-deducted.
7. Other fees specified by the Ministry of Finance and the State Administration of Taxation.
Extended information
Additional deduction is a tax-based preferential method for corporate income tax. According to the tax law, a certain proportion is added to the actual amount of expenditure as stipulated in the tax law. The amount of a deduction when calculating taxable income.
According to current policies and regulations, if an enterprise's R&D expenses for developing new technologies, new products, and new processes do not form intangible assets and are included in the current profits and losses, they will be deducted according to the regulations and will be treated as R&D expenses. 50% of the additional deduction; if an intangible asset is formed, it will be amortized at 150% of the cost of the intangible asset.
For technology-based small and medium-sized enterprises, from January 1, 2017 to December 31, 2019, the super deduction rate for R&D expenses increased from 50% to 75%.
China Accounting Network-What are the scope of R&D expenditures allowed for super deduction