1. Domestic Enterprises
Article 31 of the Provisional Regulations and Implementing Rules for Enterprise Income Tax of the People's Republic of China*** and the People's Republic of China: The percentage of residual value is within 5% of the original price, which shall be determined by the enterprise itself. According to the "State Administration of Taxation on the abolition of the enterprise income tax examination and approval of the project on the follow-up management of the notice" (Guo Shui Fa [2003] No. 70) the provisions of the second article of the fixed assets residual value of a uniform proportion of 5%.
2. Foreign-funded enterprises
According to Article 33 of the Rules for the Implementation of the Income Tax Law for Foreign Invested Enterprises and Foreign Enterprises, the residual value ratio of fixed assets for foreign-funded enterprises is generally 10%.
Article 59 of the Regulations on the Implementation of the Enterprise Income Tax Law of the People's Republic of China (Decree of the State Council No. 512 of 2007), depreciation of fixed assets calculated in accordance with the straight-line method is allowed to be deducted.
Enterprises shall calculate depreciation from the month following the month in which the fixed assets are put into use; for fixed assets that have ceased to be used, depreciation shall cease to be calculated from the month following the month in which they cease to be used.
Enterprises should be based on the nature and use of fixed assets, a reasonable determination of the estimated net residual value of fixed assets. Once determined, the estimated net residual value of fixed assets shall not be changed.
The Law of the People's Republic of China on Enterprise Income Tax (Decree of the President of the People's Republic of China No. 63 of 2007)
Article 32 If the fixed assets of an enterprise need accelerated depreciation due to technological progress or other reasons, the enterprise may shorten the depreciation period or adopt the method of accelerated depreciation.
It can be seen that the new tax law is no longer on the rate of the residual value of fixed assets to make mandatory provisions for the rate of the residual value of fixed assets to determine the rate of the right to the enterprise, but emphasize a rationality, the requirements of the production and operation of the enterprise and the nature of the fixed assets and the use of fixed assets, and reasonably determine the net residual value of the estimated fixed assets.
2 Depreciable Life Edit
According to the new Enterprise Income Tax Law, the amortization life limitations are as follows:
Unless otherwise specified, the minimum years for depreciation of fixed assets are as follows:
(1) 20 years for houses and buildings;
(2) 10 years for airplanes, trains, ships, machines, machineries and other production equipment;
(3) 5 years for appliances, tools and furniture related to production and business;
(4) 4 years for means of transportation other than airplanes, trains and ships;
(5) 3 years for electronic equipment
.