CCTV News: According to the website of the State Administration of Taxation, in order to facilitate the majority of taxpayers and payers and grassroots tax departments to review the relevant policy response calibers, the State Administration of Taxation conducted a comprehensive review and confirmation of the instant Q&A released by the State Administration of Taxation from January 2019 to July 2024, and compiled and formed a "Compilation of the Series of Tax Support Policies in 2019, 294 Current Effective Replies" covering 8 major categories, 34 topics, and 294 current effective response calibers. Today, we will learn about the relevant Q&A on the preferential policies of individual industrial and commercial households.

【Question 1】 Has the preferential policy of individual industrial and commercial households to levy personal income tax at half time? What are the specific regulations?

Answer: In order to implement the decisions and arrangements of the CPC Central Committee and the State Council, and further support the development of individual industrial and commercial households, the Ministry of Finance and the State Administration of Taxation jointly issued the "Announcement on Further Supporting the Development of Small and Micro Enterprises and Individual Industrial and Commercial Households" (No. 12, 2023). From January 1, 2023 to December 31, 2027, personal income tax will be levied at half the portion of the annual taxable income of individual industrial and commercial households that does not exceed 2 million yuan. On the basis of enjoying other preferential policies for personal income tax, individual industrial and commercial households can enjoy this preferential policy in addition. The above provisions increase the annual taxable income range for individual industrial and commercial households to collect personal income tax by half, from no more than 1 million yuan to no more than 2 million yuan, further increasing the preferential efforts.

【Question 2】How to calculate the tax reduction and exemption amount of individual business owners who enjoy the halves of their personal income tax?

A: According to the "Announcement of the State Administration of Taxation on Further Implementing Matters Related to Support the Development of Personal Income Tax Preferential Policies for Individual Industrial and Commercial Households" (No. 12 of 2023), the tax reduction and exemption amount of individual industrial and commercial households enjoy half of the tax reduction and exemption amount = (taxable amount of the part of the taxable income of operating income not exceeding 2 million yuan - tax reduction and exemption amount of other policies × part of the taxable income of operating income not exceeding 2 million yuan ÷ taxable income of operating income) × 50%. We have embedded this calculation rule in the electronic tax bureau information system. The tax authorities provide taxpayers with pre-filling services for declaration forms and report forms. Taxpayers who meet the conditions can accurately and truthfully fill in the business situation data, and the system can automatically calculate the tax reduction and exemption amount.

【Question 3】 Does the individual business households need to register if they enjoy the halved personal income tax policy?

Answer: Individual industrial and commercial households can enjoy the half-tax policy when prepayment and settlement of personal income tax. There is no need to record when enjoying the policy. You can enjoy it by filling in the relevant columns of the personal income tax return and tax exemption report form.

【Question 4】How can individual industrial and commercial households apply for the halved personal income tax policy?

A: For individual business owners who file through the Electronic Taxation Bureau, the tax authority will automatically provide them with pre-filling services for the policy in the declaration form and report form. For individual industrial and commercial households with simple declarations, the tax authorities will automatically transfer taxes according to the taxable amount after reduction and exemption.

【Question 5】I am an individual business owner who has approved the collection of personal income tax. Can I enjoy the policy of halving the collection of personal income tax?

A: You can enjoy it. According to the "Announcement of the State Administration of Taxation on Further Implementing the Preferential Policies for Supporting the Development of Personal Income Tax by Individual Industrial and Commercial Households" (No. 12 of 2023), individual industrial and commercial houses can enjoy the half-tax tax policy whether they check or approve the collection of personal income tax.

【Question 6】I am an individual business owner. I have paid taxes in advance this year on my business income. Can I still enjoy the preferential tax reduction policy of half the tax?

Answer: In order to maximize the tax reduction dividend, individual industrial and commercial households who have paid taxes in advance on their business income in the first few months of this year can also enjoy tax incentives. The specific method is to apply for tax refunds in accordance with the "Announcement of the Ministry of Finance and the State Administration of Taxation on Further Supporting the Development of Small and Micro Enterprises and Individual Industrial and Commercial Households" (No. 12 of 2023). If the taxes that should be reduced are paid before the date of the announcement, they can apply for tax refunds; they can also automatically offset the taxes for the next month. If the taxes are not offset in the year, they will be refunded when the annual reconciliation and settlement are paid.