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Corporate Income Tax Preferential Policies 2021

The preferential Corporate Income Tax Policies introduced in Caishui no. 13 [2019] "Implementing the Policy on Inclusive Tax Reliefs for Small and Micro Businesses" continue in 2021, which introduced a preferential Company Income Tax rate for small and micro companies with a taxable income up to 3 million CNY. In particular:

• small scale and low-profit enterprises with taxable income lower than 1 million CNY can enjoy a CIT rate of 20%, that would be applied on 25% of their income, leaving the residual 75% tax-free and leading to an effective rate of 5%;