Announcement on the Issue of Individual Income Tax on Sole/Family Proprietorships, Wholly Individually-owned Enterprises and Partnerships

关于个体工商户、个人独资企业和合伙企业个人所得税问题的公告

SAT revises the expense deduction amount for individual income tax of partnerships and proprietorships.

Clp Reference: 3230/14.04.23 Promulgated: 2014-04-23 Effective: 2014-04-23

(Issued by the State Administration of Taxation on, and effective as of, April 23 2014.)

（国家税务总局于二零一四年四月二十三日发布施行。）

SAT Announcement [2014] No.25

国家税务总局公告第25号

With a view to regulating the levy and administration of individual income tax, we, pursuant to the Individual Income Tax Law, hereby inform you on the issue of individual income tax on sole/family proprietorships, wholly individually-owned enterprises and partnerships as follows:

为规范个人所得税征收管理，根据个人所得税法规定，现就个体工商户、个人独资企业和合伙企业有关个人所得税问题公告如下：

If the actual operating period of an sole/family proprietorship, wholly individually-owned enterprise or partnership in a tax year is less than a full year due to its opening for business, merger, de-registration or other reason during the course of the tax year, when calculating individual income tax on the production and other business income of the owner of the sole/family proprietorship, the investor of the wholly individually-owned enterprise or a natural person partner of the partnership, its actual operating period shall be treated as one tax year. The investor's personal expense deduction rate shall be based on the actual number of months of operation and determined at the exemption rate of Rmb3,500 per month. The formula is as set forth below:

个体工商户、个人独资企业和合伙企业因在纳税年度中间开业、合并、注销及其他原因，导致该纳税年度的实际经营期不足年的，对个体工商户业主、个人独资企业投资者和合伙企业自然人合伙人的生产经营所得计算个人所得税时，以其实际经营期为个纳税年度。投资者本人的费用扣除标准，应按照其实际经营月份数，以每月3500元的减除标准确定。计算公式如下：

taxable income = total income for the year – costs, expenses and losses – investor's personal expense deduction amount for the year in question

应纳税所得额＝该年度收入总额－成本、费用及损失－当年投资者本人的费用扣除额

investor's personal expense deduction amount for the year in question = monthly expense exemption (Rmb3,500/month) × the actual number of months of operation during the year in question

当年投资者本人的费用扣除额＝月减除费用（3500元/月）× 当年实际经营月份数

tax payable = taxable income × tax rate – quick calculation deduction.

应纳税额＝应纳税所得额×税率－速算扣除数

This Announcement shall be effective as of the date of issuance. This Announcement shall apply to the calculation of individual income tax on the production and other business income of sole/family proprietorships, wholly individually-owned enterprises and partnerships for the year 2014.

本公告自发布之日起施行。2014年度个体工商户、个人独资企业和合伙企业生产经营所得的个人所得税计算，适用本公告。

clp reference:3230/14.04.23 prc reference:国家税务总局公告 [2014] 第25号 issued:2014-04-23 effective:2014-04-23

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