According to the Provisional Regulations of People's Republic of China (PRC) on Income Tax, the donation expenditure is divided into two parts, and the items included are also different.

Accounting treatment:

1. Public welfare and relief donations are divided into two parts: first, the donation amount is less than 12% of the annual accounting profit, which is allowed to be deducted before tax when calculating the enterprise income tax; Second, the part that exceeds the annual accounting profit 12% will not be deducted when calculating the enterprise income tax. The above expenses are included in "non-operating expenses" when incurred, and the corresponding tax adjustments are made when calculating and paying enterprise income tax at the end of the year.

2. Non-public welfare and relief donations, as well as various non-advertising sponsorships, are included in non-operating expenses when the business occurs.

The calculation and declaration of donation expenses are mainly based on Schedule 8 of the declaration form, List of Donations for Public Welfare Disaster Relief, and the calculation must also be based on the provisions of this table. The filling instructions are as follows:

1. This schedule reports all public welfare disaster relief donations incurred in this period through non-profit social organizations or state organs;

2, "use" column to fill in the use of public welfare disaster relief donations, can be classified according to the use of reporting;

3 "deduction limit of public welfare disaster relief donations" = (line 43 of the main table "taxpayer's income before adjustment"+total donation expenditure plus tax adjustment items) × legal deduction rate.

What are the donation expenses of enterprises?

Loss and donation expenses are divided into the following situations:

(1) Donations made by taxpayers directly to recipients are not allowed to be deducted before tax.

(2) Taxpayers' donations for public welfare and relief are allowed to be deducted before tax within 3% of the annual taxable income.

(3) Taxpayers' public welfare and relief donations to non-profit organizations such as charities and foundations are allowed to be fully deducted before paying corporate income tax and personal income tax through non-profit social group editions, donations from state organs to compulsory education in rural areas, donations to the Red Cross Society for the elderly and donations to public welfare youth activities (including new ones).

What subjects does the enterprise system of donation expenditure do?