Issues related to accounting and tax law The formulation of new accounting standards is consistent with international practices, further expanding the application scope of the prudence principle, adding the principle of substance over form, and the selection of accounting methods and business processing procedures are also more consistent with the economic essence of the business.
However, many of the reform measures are inconsistent with the objectives and principles of taxation, which has led to obvious differences between the recognition and measurement of income, the deductibility of expenses, and the principles followed by corporate taxation and accounting principles, resulting in
There are big differences in corporate taxation and accounting treatments.
2. Analysis of the Differences between Employee Compensation Standards and Tax Laws The formulation of the new standards is consistent with international practices, further expanding the application scope of the prudence principle, adding the principle of substance over form, and the selection of accounting methods and business processing procedures are also more consistent with the economics of the business
substance.
However, many of the reform measures are inconsistent with the objectives and principles of taxation, which has led to obvious differences between the recognition and measurement of income, the deductibility of expenses, and the principles followed by corporate taxation and accounting principles, resulting in
There are big differences in corporate taxation and accounting treatments.
The specific analysis is as follows: First, the difference in the objects of wage and salary expenditures: In the tax law, the objects of wage and salary expenditures are employees who work or are employed by the unit, which is distinguished from independent labor services.
The wages and salaries received by employees are not subject to business tax and should be processed with self-made vouchers.
If an enterprise accepts independent services provided by individuals from outside units, it falls within the scope of turnover tax. Regardless of whether it exceeds the threshold, it must be recorded in the account with an invoice issued by the tax authority.
The “employees” referred to in the employee compensation standards are relatively broad, and compared with the “employees who serve or are employed” in the tax law, they both overlap and expand.
Part-time employees, temporary personnel who have not entered into a labor contract with the enterprise, and members of the board of directors and supervisory board who have not entered into a labor contract with the enterprise but are formally appointed by the enterprise cannot be treated as wages and salaries expenses in the tax law.
It is recommended that enterprises set up detailed accounting accounts of "employees" and "non-employees" under the "employee compensation payable" account in order to correctly calculate the personal income tax that should be withheld and make tax adjustments when calculating corporate income tax at the end of the year.
The second is the difference in the scope of employee remuneration expenditures: The employee remuneration guidelines stipulate that all prices (consideration) given or paid by an enterprise to obtain services provided by employees constitute employee remuneration, that is to say, regardless of monetary or non-monetary remuneration
, regardless of on-the-job or post-employment remuneration, whether the measurement is relatively straightforward and clear conventional remuneration or modern remuneration based on equity instruments (cash-settled share-based payment), whether the remuneration provided to the employee himself or to the employee’s spouse, children or
The benefits of other dependents, whether material salary or educational benefits, are employee benefits.
Wage and salary expenses stipulated in the tax law refer to all cash or non-cash labor remuneration for employees who serve or are employed by the enterprise.
3. Differences in employee wages, bonuses, allowances and subsidies Analysis of employee wages, bonuses, allowances and subsidies.
It refers to hourly wages, piece-rate wages, excess labor remuneration paid to employees and labor remuneration to increase revenue and save expenditure, which constitute the total salary according to the provisions of the National Bureau of Statistics, to compensate employees for special or additional labor consumption and for other special reasons.
subsidies, as well as price subsidies paid to employees to ensure that their wages are not affected by prices.
This category is basically the same as the salary category in the new tax law.
Article 8 of the "Enterprise Income Tax Law of the People's Republic of China" passed at the fifth session of the 10th National People's Congress on March 16, 2007 stipulates: The actual and reasonable expenditures incurred by the enterprise related to the acquisition of income,
Includes costs, expenses, taxes, losses and other expenses that are allowed as deductions in calculating taxable income.
This article unifies the pre-tax deduction policy for various actual expenditures incurred by domestic and foreign-funded enterprises, including wages and salaries.
On November 28, 2007, the 197th Executive Meeting of the State Council passed the "Implementation Regulations of the Enterprise Income Tax Law of the People's Republic of China", which clarified the pre-tax deduction of wages and salaries.
Article 34 of the Regulations stipulates: “Reasonable wages and salaries incurred by the enterprise shall be deducted. The wages and salaries mentioned in the preceding paragraph refer to all forms of cash paid by the enterprise to employees who serve or are employed by the enterprise in each tax year.
Or non-cash forms of labor remuneration, including basic wages, bonuses, allowances, subsidies, year-end salary increases, overtime wages, and other expenses related to the employee's appointment or employment."
The old tax law implemented a tax calculation system for the deduction of wages and salaries for domestic-funded enterprises, and a real-life deduction system for foreign-funded enterprises. This is one of the important reasons for the uneven tax burden between domestic and foreign-funded enterprises.
The Implementing Regulations unify the pre-tax deduction policy for wages and salaries of enterprises and stipulate that reasonable wages and salaries incurred by enterprises shall be deducted.
This provision expands the scope of full pre-tax deductions for wages, mainly by canceling the discriminatory provisions on pre-tax deductions for domestic-funded enterprises based on taxable wages, and at the same time avoiding the duplication of the same nature of income for employees’ wages and salaries.
tax.