What Are the Different Types of Allowable Deductions?

Allowable deduction items refer to tax-exempt items that are allowed to be deducted from realized profits as stipulated by the tax law when taxpayers such as state-owned enterprises and collective enterprise income taxes calculate the taxable income. For example, the allowable deduction items for state-owned enterprise income tax include: (1) Profits and dividends distributed to investment units before the affiliate levies income tax. (2) Individual items of retained profits stipulated by the State Council and the Ministry of Finance. (3) With the approval of the financial department, the loan for the return of additional profits after the capital construction reconstruction expansion loan project is put into operation. ^[1]