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Corporate Service China Q&A Regarding the Expenditure of Corporate Public Welfare Donations
FAQQ&A Regarding the Expenditure of Corporate Public Welfare Donations
| Q： | What is charitable donation? |
| A： |
Public welfare donation refers to the donation expenditure of enterprises for charitable activities and public welfare undertakings through public welfare social organizations or people's governments at or above the county level (including the county level) and their ministries and commissions and institutions directly under them.. |
| Q： | How to determine the amount of non-monetary asset donation? |
| A： |
Donations of non-monetary assets received are recognized at their fair value. When donating to public welfare social organizations, people's governments at or above the county level and their departments and other state organs, the donor shall provide a certificate indicating the fair value of the donated non-monetary assets; If no proof can be provided, the recipient shall not issue the donation bill to the recipient. |
| Q： | What information is required for public welfare donations? |
| A： |
The public welfare donation bill is the original certificate of accounting, including electronic and paper forms. Electronic bills and paper bills have the same legal effect, and are the basis for supervision and inspection by financial, tax, audit, supervision and other departments. The bill for donation to public welfare undertakings can be used as a valid proof for the donor to donate to other countries and apply for pre-tax deduction of the donation amount in accordance with the relevant regulations of the state. |
| Q： | Can public welfare donations be deducted in the calculation of taxable income? |
| A： |
The part of the total annual profit of an enterprise within 12% is allowed to be deducted when calculating the taxable income. The part exceeding 12% of the total annual profit is allowed to be deducted in the calculation of taxable income within three years after the cart-forward. |
| Q： | Can the expenses related to public welfare donations incurred by enterprises be deducted before the enterprise income tax? |
| A： |
Freight, insurance, labor costs and other related expenses incurred by enterprises in the process of donating non-monetary assets, which are included in the amount recorded in the public welfare donation bills issued by state organs and public welfare social organizations, shall be deducted before tax as public welfare donation expenses in accordance with regulations; The above expenses are not included in the amount recorded in the bill of public welfare donation, and are deducted before tax as related expenses of enterprises in accordance with regulations. |
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