How Does The Cash Payment To The Intern Be Deducted Before Tax?

The employment of graduates is related to the overall situation of economic development and improvement of people's livelihood.

The state attaches great importance to it, insists on stabilizing and expanding employment as an important goal of macroeconomic regulation and control, vigorously implements the employment priority strategy, actively deepens the administrative examination and approval system and the reform of the commercial system, and promotes the public entrepreneurship, the innovation of all the people, and the effect of pioneering and driving the employment multiplier to be further released, so as to maintain the overall stability of the employment situation.

In the era of increasing labor costs, not only a large number of small and micro enterprises employ many interns of secondary and tertiary institutions, but also some large state-owned enterprises and multinational companies will employ many interns.

According to the Circular of the Ministry of Finance and the State Administration of Taxation on the issue of enterprise income tax policy on student remuneration for Internship (fiscal 107 [2006] No. 107): first, any enterprise that has signed a cooperation agreement with a secondary vocational school or a higher education institution for a period of more than three years shall be paid before the payment of the enterprise income tax.

The specific measures for collection and administration shall be separately formulated by the State Administration of taxation.

The Circular of the State Administration of Taxation on Issuing the administrative measures for pre tax deduction for payment of interns by enterprises shall be paid by the fourth enterprises in accordance with the provisions of the fiscal and taxation [2006]107 document. The remuneration paid to the students in this enterprise can be deducted in accordance with the relevant provisions of these measures when calculating the payment of enterprise income tax.

The fifth interns' enterprises and students' schools must formally sign a practice cooperation agreement with a term of over three years (including three years), clearly stipulate the rights and obligations of both sides.

The sixth is that the enterprises who have not signed an internship cooperation agreement with the school or have only signed a practical cooperation agreement with a term of less than three years, shall not be included in the enterprise income tax deduction before paying the intern.

Seventh enterprises and schools formally signed three years or more (including three years) of the practice cooperation agreement, if there is less than three years to stop the performance of the agreement, the competent tax authorities should have increased the taxable income to the enterprises that have enjoyed the tax policy before deducting interns' remuneration, to levy corporate income tax and to collect late fees in accordance with the law; and to stop the implementation of the agreement for three years after the death of the business entity or the cancellation of the school and other objective reasons.

Eighth enterprises can deduct the salaries of interns before tax, including basic wages, bonuses, allowances, subsidies (including regional subsidies, price subsidies and meal allowance), overtime wages, year-end pay increases and insurance premium paid by trainees based on internship contracts for interns.

The payment paid to interns by non monetary means is not allowed to be deducted before tax.

Ninth enterprises or schools must set up bank accounts independently for each intern. The monetary remuneration paid by the enterprises to the interns must be paid in the form of pfer.

The tenth payment of pre tax deductions for enterprises is managed according to the pre tax deduction method stipulated by the tax.

The actual payment of the intern's remuneration is higher than that before the permitted tax deduction, and the deduction is made according to the permitted wage before deducting the wage standard. If the actual payment of the intern's salary is lower than the permitted tax before deducting the wage standard, the tax shall be deducted according to the actual remuneration.

[Note: according to the state

Announcement on the publication of the catalogue of tax normative documents that has been invalidated and invalidated in part of the articles abolished by the Ministry of Taxation (second announcement of the State Administration of Taxation on 2011), and the fiscal 107 [2006] has been invalid since January 4, 2011.

]

It is required that enterprises in secondary vocational schools and institutions of higher learning should pay the corresponding personal income tax payable in accordance with the personal income tax law stipulated in our personal income tax law.

Following this document, with the release and implementation of the enterprise accounting standards, the scope of the staff has changed, and the interns have also been included in the accounting scope of the employees. The State Administration of Taxation issued the notice of the State Administration of Taxation on the issue of tax treatment on the taxable income of enterprise income tax (the fifteenth announcement of the State Administration of Taxation 2012): 1. The cost of pre tax deduction for seasonal workers and temporary workers and so on should be divided into wages and salaries and staff welfare expenses, and the deduction should be made before the enterprise income tax according to the enterprise income tax law.

Among them

The expenses are allowed to be included in the base of the total wages and salaries of the enterprises as the basis for calculating the deduction of other related expenses.

Moreover, it was not emphasized in the 15 and 2015 Announcement No. 34 of 2012.

A cooperation agreement has been signed with secondary vocational schools and institutions of higher learning for more than three years.

At the same time, the remuneration paid by the enterprise to the interns can be carried out in accordance with the relevant regulations of the State Administration of Taxation on the deduction of the wages and salaries of employees and the welfare of employees (the tax Letter No. 2009] No. 3).

That is, the wage and salary system stipulated by the shareholders' meeting, the board of directors, the remuneration committee or the relevant management organizations shall be deducted from the salaries and salaries actually paid to the employees.

When the tax authorities confirm the rationality of wages and salaries, they can grasp the following principles: (1) the enterprises have drawn up a relatively standardized system of wages and salaries for employees; (two) the wage and salary systems established by enterprises are in line with the industry and regional level; (three) the wages and salaries paid by enterprises in a regular period are relatively fixed, and the adjustment of wages and salaries is orderly; (four) the enterprises have fulfilled the duty of withholding and paying personal income tax according to the actual wages and salaries paid; (five) the arrangement of wages and salaries does not aim at reducing or evading taxes.

The above regulations do not limit the payment method, and the payment of the trainee paid in cash can be deducted according to the relevant regulations before tax.

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