Note: With the rapid development of China's economy, personal income tax, as an important tax method, contributes more and more to the national fiscal revenue. So, how is the individual income tax levied? This article will give a detailed answer to the collection method of individual income tax, and introduce relevant knowledge to help readers better understand and respond to individual income tax. 1、 Collection object of individual income tax
With the rapid development of China's economy, personal income tax, as an important tax method, contributes more and more to the national fiscal revenue. So, how is the individual income tax levied? This article will give a detailed answer to the collection method of individual income tax, and introduce relevant knowledge to help readers better understand and respond to individual income tax.
1、 Collection object of individual income tax
The objects of individual income tax collection refer to individuals who have a place of residence in the People's Republic of China, including Chinese citizens and foreigners. Individual income tax shall be paid for income from wages, salaries, remuneration for labor services, or business income from self-employed businesses, partnerships, sole proprietorships, etc.
2、 Collection method of individual income tax
The collection of individual income tax is mainly divided into comprehensive taxation and classified taxation.
1. Comprehensive taxation
Comprehensive taxation refers to the consolidation of individual incomes, and then the collection is carried out according to a certain tax rate. This method of collection applies to income from wages, salaries, remuneration for labor services, etc. According to the Individual Income Tax Law of the People's Republic of China, the comprehensive tax rates are divided into seven levels, ranging from 3% to 45%.
2. Classified taxation
Classified taxation refers to the use of different tax rates and collection methods according to different sources and nature of income. This collection method is applicable to business income of individual businesses, partnerships, sole proprietorships, etc. According to the Individual Income Tax Law of the People's Republic of China, the tax rates of classified taxation are divided into three levels, ranging from 5% to 35%.
3、 Calculation method of individual income tax
The calculation method of individual income tax is to determine the tax amount according to the taxable income and the applicable tax rate. Taxable income refers to the amount of an individual's income in a certain period less legal expenses, donations and other deductions. The applicable tax rate is determined according to the tax rate table stipulated in the Individual Income Tax Law.
The calculation formula of individual income tax is as follows:
Individual income tax=taxable income × applicable tax rate - quick calculation deduction
Among them, the quick calculation deduction amount is determined according to the applicable tax rate, which is used to simplify the calculation process.
4、 Declaration and payment of individual income tax
It is the duty of individual taxpayers to declare and pay individual income tax. According to the Individual Income Tax Law of the People's Republic of China, the tax period of individual income tax is from March 1 to June 30 every year. Individual taxpayers need to fill in individual income tax returns and pay corresponding taxes according to their income within the tax period.
There are two main ways to pay individual income tax: one is to withhold and remit the individual income tax by the unit where the individual belongs; The second is individual declaration and payment, that is, individual declaration and payment of individual income tax according to their own income.
5、 Individual income tax exemption and preferential policies
The purpose of individual income tax reduction and exemption and preferential policies is to encourage individual taxpayers to increase their income and consumption, and improve their consumption ability and living standards. According to the Individual Income Tax Law of the People's Republic of China, the reduction, exemption and preferential policies of individual income tax mainly include the following aspects:
1. Special deductions for supporting the elderly, children's education, housing * * interest, etc;
2. Pre tax deduction of social insurance expenses such as basic endowment insurance and basic medical insurance;
3. Individual income tax in specific industries and regions will be reduced or preferential.
6、 Compliance and risk prevention of individual income tax
Individual income tax compliance and risk prevention are issues that individual taxpayers should pay attention to. Individual taxpayers shall, in accordance with the provisions of national laws and regulations, truthfully declare individual income tax and pay tax on time. At the same time, individual taxpayers should also understand the relevant policies and regulations of individual income tax to avoid risks and disputes due to lack of understanding of the regulations.
As an important way of taxation, personal income tax can not be ignored for its contribution to national fiscal revenue. It is very important for individual taxpayers to know the collection method, calculation method, tax declaration and payment of individual income tax. At the same time, individual taxpayers should also pay attention to the reduction and exemption of individual income tax and preferential policies, as well as compliance and risk prevention, so as to better deal with issues related to individual income tax.
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