Individual income tax is a kind of income tax levied on all income earned by individuals (natural persons).
Individual income tax is divided into domestic income and foreign income. It mainly includes the following 11 items:
Wage and Salary Income
Wage and Salary Income refers to the wages, salaries, bonuses, year-end raises, labor bonuses, allowances, subsidies, and other incomes related to an individual's office or employment. That is to say, the income obtained by individuals, as long as it is related to the post, employment, regardless of the unit of its capital expenditure channels or in the form of cash, in-kind, securities and other forms of payment, are wages, salaries, income items of the object of taxation.
Individual industrial and commercial households production, business income
Individual industrial and commercial households production, business income includes four aspects:
(a) by the administration for industry and commerce approved to open and receive a business license for urban and rural individual industrial and commercial households, engaged in the industry, handicrafts, construction, transportation, commerce, catering, services, repairs, and other sectors of the production, business income. Income obtained.
(2) Individuals approved by the relevant government departments, obtaining a business license, engaged in running schools, medical care, consulting and other paid service activities to obtain income.
(3) Income derived by other individuals from engaging in individual industrial and commercial production and operation, as well as income derived by individuals from engaging in production and operation activities on a temporary basis.
(4) All taxable income related to production and operation obtained by the above individual industrial and commercial households and individuals.
Individual Income Tax
Income from Contracting and Leasing to Enterprises and Public Institutions
Income from Contracting and Leasing to Enterprises and Public Institutions refers to the income obtained by an individual from Contracting and Leasing as well as from Sub-contracting and Sub-letting, and includes income of the nature of salary and wages obtained by an individual on a monthly or per-occasion basis.
Income from remuneration for services
Income from remuneration for services refers to the income derived from design, decoration, installation, drafting, laboratory, testing, medical, legal, accounting, consulting, lecturing, journalism, broadcasting, translating, reviewing, painting, calligraphy, sculpture, film, audio, video recording, performance, show, advertisement, exhibition, technical service, referral service, economic service, agency service, and other services. Income obtained.
Manuscript Income
Manuscript income refers to the income received by an individual from the publication of his or her work in the form of a book or newspaper. The term "work" here refers to works that can be published in book or newspaper form, including Chinese and foreign words, pictures, music scores, etc. The term "personal work" includes one's own writings, translations, and so on. Individuals who receive remuneration for posthumous works shall be taxed according to the item of income from manuscripts.
Royalty Income
Royalty income refers to the income derived from the provision of the right to use patent rights, copyrights, trademarks, non-patented technologies and other franchises. Income derived from the provision of the right to use copyrights does not include income from royalties. Income derived by an author from the public auction (bidding) of the original or a copy of the manuscript of his/her written work shall be taxed under the item of royalty income.
Income from Interest, Dividends, and Bonuses
Income from interest, dividends, and bonuses refers to the interest, dividends, and bonuses obtained by an individual who owns a debt or an equity interest. Interest refers to interest on one's deposits (the state announced the abolition of interest tax from the day after October 8, 2008), interest on goods, and interest on the purchase of various bonds. Dividends, also known as stock dividends, are the investment benefits that stockholders receive from a joint stock company on a regular basis by virtue of their stock certificates in accordance with the articles of incorporation of the joint stock company. Dividends, also known as corporate (enterprise) dividends, are profits in excess of the dividend portion of a joint-stock company or enterprise that are distributed on a share-by-share basis in accordance with the profits to be distributed. Payment of dividends and bonuses in the form of shares by a joint-stock enterprise to individual shareholders, i.e., distribution of bonus shares, shall be taxed as income in the amount of the face value of the shares distributed.
Property Leasing Income
Property leasing income refers to the income from leasing of buildings, land use rights, machinery, equipment, vehicles and other property. Property includes movable and immovable property.
Income from property transfer
Income from property transfer refers to the income derived from the transfer of securities, equity, buildings, land use rights, machinery, equipment, vehicles and vessels, and other property to other people or units, including the transfer of immovable and movable property and the income derived. There is no tax on the income derived from individual stock trading.
Incidental Income
Incidental income refers to the income obtained by an individual on a non-recurring basis, which belongs to various kinds of opportunistic income, including winning prizes, jackpots and lotteries, as well as other incidental income (including prizes, in-kind goods and marketable securities). Individuals purchasing social welfare prize-raising raffle tickets and China Sports Lottery tickets are exempted from individual income tax if the income from one winning does not exceed RMB 10,000, and if it exceeds RMB 10,000, it shall be taxed in full under the item of incidental income (the tax rate as of April 21, 2011 is 20%).
Other Income
In addition to the above 10 taxable items, other income shall be determined for taxation by the finance department of the State Council. The financial departments of the State Council refer to the Ministry of Finance and the State Administration of Taxation. As of April 30, 1997, the Ministry of Finance and the State Administration of Taxation have determined the other items of income to be taxed:
(1) Individuals who have obtained "Cai Guanshen Honorary Foundation for Academicians of the Chinese Academy of Sciences" issued by the Honorary Bonus for Academicians of the Chinese Academy of Sciences.
(2) Individuals to obtain by the banking sector in excess of the national interest rate and value-added subsidy rate paid by the deposit bonus.
(3) Individuals who have obtained gratuitous sums of preferential income as a result of the payment of relevant insurance costs by the employing organization.
(iv) Interest (or similar income paid in other names) paid to the insurance company on the insured amount at the bank's savings deposit rate for the same period of time to life insurance households that are not insured during the policy period.
Individual Income Tax
(v) Rebate income or transaction fee rebate income obtained by an individual stockholder from a securities company that solicits a large stockholder to open an account and trade with the company, and pays a portion of the transaction fee obtained to the large stockholder.
(6) Individuals obtaining some units and departments in the year-end summaries, various celebrations, business transactions and other activities, for other units and departments of the relevant personnel to distribute cash, in kind or marketable securities.
(vii) Resignation risk money.
(viii) Individuals are paid for providing guarantees for units or others.
If it is difficult to define which item of taxable income an individual receives, the competent tax authorities shall examine and determine.
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