What Is a Personal Exemption?

The personal income tax form is a form for calculating personal income tax.

Personal income tax rate table

Personal income tax rates:

(1) For comprehensive income, an excess progressive tax rate of 3% to 45% is applicable (the tax rate table is attached);

(2) For business income, an excessive progressive tax rate of 5 to 35 percent is applicable (attached to the tax rate table);

(3) Income from interest, dividends, and dividends, income from property leases, income from property transfers, and incidental income shall be subject to a proportional tax rate of 20%. ^[2]

The income from the production and operation of individual industrial and commercial households and the income from contracted and leased operations of enterprises and institutions apply

series	Annual taxable income	tax rate(%)	Quick calculation deductions
1	Not more than 15,000 yuan	5	0
2	More than 15,000 to 30,000 yuan	10	750
3	More than 30,000 to 60,000 yuan	20	3750
4	More than 60,000 to 100,000 yuan	30	9750
5	More than 100,000 yuan	35	14750

Note:

1. The tax-included grades and non-tax-grade grades listed in this table are the income after deducting costs, expenses and losses from the total income of each tax year in accordance with the tax law;

2. Tax-included distance applies

Taxable income = monthly income-5000 yuan (starting point)-special deduction (three insurances and one gold, etc.)-

On October 22, 2003, the Ministry of Commerce put forward a number of suggestions such as canceling the collection of interest tax and increasing the personal income tax exemption.

In early 2005, Guangdong's finance again investigated the increase of individual tax exemptions in order to provide a reference for the central government to introduce tax reform policies as soon as possible.

On July 26, 2005, Premier Wen Jiabao of the State Council hosted an executive meeting of the State Council on the 26th to discuss and pass the "Personal Income Tax Law of the People's Republic of China Amendment (Draft)" in principle.

On August 23, 2005, the 17th Session of the Standing Committee of the 10th National People's Congress considered the draft amendments to the Individual Income Tax Law for the first time. On October 27, 2005, the eighteenth meeting of the Standing Committee of the Tenth National People's Congress reconsidered the "Draft Amendment of the Individual Income Tax Law". The meeting voted to pass the decision of the Standing Committee of the National People's Congress on amending the Personal Income Tax Law, exempting the amount of 1,600 yuan. Effective from January 1, 2006.

On June 29, 2007, the 28th meeting of the Standing Committee of the Tenth National People's Congress adopted the "Decision on Amending the" Personal Income Tax Law of the People's Republic of China "" and made the fourth amendment to the Personal Income Tax Law.

On December 29, 2007, the 31st Session of the Standing Committee of the Tenth National People's Congress passed a decision on amending the personal income tax law. The personal income tax exemption has been increased from 1,600 yuan to 2,000 yuan since March 1, 2008.

Personal income tax on interest on savings deposits was temporarily exempted in 2008.

In 2010, personal income tax was levied on the income obtained by individuals from transferring restricted stock in listed companies.

On June 30, 2011, the Twenty-first Session of the Standing Committee of the Eleventh National People's Congress passed a tax law amendment on June 30, increasing the tax exemption from 2,000 yuan to 3500 yuan, and applying an excessive progressive tax rate From 3% to 45%, it will be implemented from September 1, 2011.

On August 31, 2018, the fifth meeting of the Standing Committee of the Thirteenth National People's Congress

The tax exemption rate is also called "zero tax rate". Refers to the tax rate of zero for a certain taxable object and a taxable object in a specific link. In theory, zero tax rate is different from tax exemption. Tax exemption refers to exempting certain taxable objects and certain taxpayers from their own taxable amount, while purchased goods or services are still tax-included.

The tax rate of zero is not only that the taxpayer's taxable object in this link does not pay taxes, but also the tax transferred from previous links must be refunded to achieve zero tax rate. However, in practice, the meaning of zero tax rate is not strictly used in different tax types. For example, if the income tax often corresponds to the tax-free amount of the taxable income at zero tax rate, of course, the income tax does not have the problem of transferring tax. Another example is the fixed-asset investment direction adjustment tax. An investment project with a zero tax rate only refers to the exemption of the taxable amount of the investment project itself. The purchase of various goods and services is actually tax-included and is not refunded. VAT amount. What truly embodies the zero-tax rate is theoretically defined as a zero-value-added tax on export products, that is, taxpayers' export products can not only pay the taxable amount of the value-added in this link, but also refund the tax paid for the value-added in previous links.

The value-added tax exemption rules only exempt the taxpayers from the value added in this link. The goods and services purchased by the taxpayers are still tax-included. The zero-tax rate on exported products is intended to reward exports and enable Chinese products to compete in the international market at a completely tax-free price.