China Offers Enhanced Pre-Tax Deductions of R&D Expenses
19 April 2021
On 31 March, the Ministry of Finance and the State Taxation Administration issued an announcement (No. 13 ) on the policy of enhanced pre-tax deductions of R&D expenses. With respect to the R&D expenses actually incurred by an enterprise but are not converted into intangible assets and recorded in the profit and loss account of the current period, an extra 100% of the amount of R&D expenses actually incurred is deductible before tax payment in addition to the deduction of actual expenses as prescribed starting from 1 January 2021. If the said expenses have been converted into intangible assets, such expenses may be amortised at the rate of 200% of the cost of the intangible asset before tax payment from 1 January 2021. The announcement took effect on 1 January 2021.
Source: Ministry of Finance
- Mainland China