To further support the development of small and micro enterprises, the relevant tax policies are hereby announced as follows:

I. The part of annual taxable income of small low-profit enterprises over 1 million yuan but under 3 million yuan shall be calculated at 25% as taxable income, and subject to corporate income tax at a rate of 20%.

II. Small low-profit enterprises mentioned in this announcement refer to enterprises engaged in industries not restricted or prohibited by the State and meeting the following three conditions: annual taxable income under 3 million yuan, number of employees under 300 people and total assets under 50 million yuan.

The number of employees, including the number of employees who have established labor relations with the enterprise and the number of employees accepted by the enterprise as labor dispatch. The said number of employees and total assets shall be determined by the quarterly average of the enterprise for the full year. The specific calculation formula is as follows：

Quarterly average = (beginning value of quarter + ending value of quarter) ÷ 2

Quarterly average for the full year = the sum of the average values of each quarter of the year ÷ 4

If the company starts or terminates its business activities in the middle of the year, the actual operating period will be used as a tax year to determine the above-mentioned indicators.

III. The implementation period of this announcement is from January 1, 2022 to December 31, 2024.

Notice is hereby given.

Ministry of Finance, State Taxation Administration
14, March 2022