Circular of the State Administration of Taxation on Printing and Circular of the State Administration of Taxation on Printing and Distributing the Administrative Measures for the Final Settlement and Payment of Enterprise Income Taxes (Revised in 2005)

Circular of the State Administration of Taxation on Printing and Distributing the Administrative Measures for the Final Settlement and Payment of Enterprise Income Taxes (Revised in 2005)

Guo Shui Fa [2005] No. 200

December 15, 2005

The bureaus of state taxes and those of local taxes of all provinces, autonomous regions, municipalities directly under the Central Government, and municipalities under separate state planning:

In order to strengthen the administration of enterprise income taxes collection, further improve the final settlement of enterprise income taxes, we have printed the revised "Measures for the Administration of Final Settlement and Payment of Enterprise Income Taxes" and hereby distribute them to you in light of the requirements of "clarifying the subjects, regulating the procedures, optimizing the services, and improving the quality". Please comply with and implement the present Measures.

Administrative Measures for the Final Settlement and Payment of Enterprise Income Taxes

Article 1 The present Measures are formulated in accordance with the relevant provisions in the "Law of the People's Republic of China on the Administration of Tax Levying" and the Detailed Rules for the Implementation Thereof (hereinafter referred to as the Law for the Administration of Tax Collection and the Detailed Rules for the Implementation Thereof), the "Interim Regulations of the People's Republic of China on Enterprise Income Tax" and the Detailed Rules for the Implementation Thereof (hereinafter referred to as the Regulation and the Detailed Rules for the Implementation Thereof) for the purpose of strengthening the administration of the collection of enterprise income taxes and further regulating the final settlement of enterprise income taxes.

Article 2 The expression "final settlement of enterprise income taxes" shall refer to the activities whereby a taxpayer calculates the taxable income and the payable amount of income taxes of the whole year by itself in accordance with the taxation laws, regulations, rules and other relevant provisions on enterprise income taxes within 4 months after the end of the tax year, determines the amount of taxes to be made up or refunded in the current year on the basis of the monthly or quarterly prepaid amount of income taxes, fills out the annual enterprise income tax return forms, files annual enterprise income tax return to the competent taxation authority, provides relevant documents as required by the taxation authority, and settles the amount of enterprise income taxes of the whole year.

Article 3 A taxpayer whose enterprise income taxes are collected by way of payment by self-assessment or of verifying the taxable income rate shall, no matter whether it is within the period of tax reduction or exemption, or whether it makes profits or suffers from losses, make final settlement in accordance with the Regulation and the Detailed Rules for the Implementation Thereof as well as the relevant provisions of the present Measures.
A taxpayer whose enterprise income taxes are collected in a way of verifying the fixed amount need not make final settlement.

Article 4 A taxpayer shall, when making final settlement of enterprise income taxes, make tax payment adjustments in accordance with the taxation laws, regulations and the relevant provisions on enterprise income taxes.
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