Stock dividends are subject to personal income tax, which is paid at a rate of 20% if the shareholding period is less than one month (including one month); 10% if the shareholding period of an individual is more than one month and up to one year (including one year); and 5% if the shareholding period of an individual is more than one year.
Investors will be charged personal income tax when they sell dividend-paying stocks, but not in other cases, in which the personal income tax charge is related to the investor's holding period, which is stipulated as follows:
With a holding period of less than one month (including one month), dividends and bonuses received by the investor will be subject to personal income tax at a rate of 20%; with a holding period of more than one month, less than one year (including one year), and less than one year (including one year), the investor will be subject to a rate of 5%.
When the holding period is less than one month (including one year), the dividend and bonus received by the investor will be taxed at a rate of 10%; if the holding period is more than one year, the dividend and bonus received by the investor will be exempted from personal income tax.
For example, if Tang holds 1,000 shares of a certain stock and the company pays dividends at the rate of 1 yuan for every 10 shares, and sells the shares after holding them for one month, then Tang needs to pay individual income tax = 100×1×20 percent = 20 yuan.
It should be noted that the holding time is counted from the day the investor buys the share, not from the day the dividend is paid.
Legal basis: The Individual Income Tax Law of the People's Republic of China
Article 6: Scope of each individual's income under the Individual Income Tax Law:
(1) Income from wages and salaries refers to wages, salaries, bonuses, year-end raises, labor bonuses, allowances, subsidies, and other income derived from an individual's position or employment, and other income related to the position or employment. .
(2) Income from remuneration for services refers to the income derived from the performance of services, including design, decoration, installation, drafting, laboratory, testing, medical, legal, accounting, consulting, lecturing, translating, reviewing, painting, calligraphy, sculpture, film, audio, video, performance, acting, advertising, exhibition, technical services, referral services, brokerage services, agency services and other services. Income.
(3) Income from manuscripts refers to the income obtained by an individual from the publication and dissemination of his/her works in the form of books, newspapers and magazines.
(d) Royalty income, refers to the income obtained by an individual who provides the use of patent rights, trademark rights, copyrights, non-patented technologies and other franchises for the use of copyrights, excluding the income from manuscripts.
(E) business income, refers to:
1. Individual industrial and commercial households engaged in production, business activities to obtain income, sole proprietor investors, individual partners of partnerships from the territory of the registered sole proprietorships, partnerships, production, operation of income 2. Individuals engaged in the running of schools, medical care, consulting and other paid service activities in accordance with the law to obtain income 3. Individuals on the Enterprises, institutions, contracting, leasing and subcontracting, subletting income 4. Individuals engaged in other production, business activities to obtain income.
(F) interest, dividends, bonuses, refers to individuals with debt, equity and other interest, dividends, bonuses.
(vii) Income from property leasing refers to the income obtained by an individual from the leasing of real estate, machinery and equipment, vehicles and vessels, as well as other property.
(H) property transfer income, refers to the transfer of securities, equity, partnership shares, real estate, machinery and equipment, vehicles and boats, as well as other property income.
(ix) incidental income, refers to the individual to win the prize, winning the lottery, winning the lottery and other incidental nature of the income.
If it is difficult to define the items of taxable income for the income obtained by an individual, it shall be determined by the competent tax authorities of the State Council.
Article 7 The method of levying individual income tax on income from stock transfers shall be separately prescribed by the State Council and reported to the Standing Committee of the National People's Congress for the record.
Article 8 The forms of individual income, including cash, in-kind, marketable securities and other forms of economic benefits shall be calculated in accordance with the price stated on the vouchers obtained for in-kind, and the taxable income shall be calculated in accordance with the price stated on the vouchers obtained for in-kind without vouchers, or the price stated on the vouchers is obviously low, and the amount of taxable income shall be approved by reference to the market price. Taxable income for other forms of economic benefits, with reference to the market price of the approved taxable income.