Circular of Ministry of Finance and State Administration of Taxation on the Issues Concerning Tax-exempt Income in Enterprise Income Tax of Non-profit Organizations

Cai Shui [2009] No. 122

Finance departments (bureaus) and state and local tax administrations of provinces, autonomous regions, municipalities directly under the Central Government and separately planning cities, and Finance Bureau of Xinjiang Production and Construction Corps.,

Based on Article 26 of Enterprise Income Tax Law of the People's Republic of China and Article 85 of Implementing Regulations of Enterprise Income Tax Law of the People's Republic of China (Decree No. 512of the State Council), the range of tax-exempt income in enterprise income tax of qualified non-profit organizations is defined as follows:

　　Ⅰ. The following incomes of a non-profit organization shall be tax-free incomes:

　　(1) Income from accepted donations of other units or individuals;

　　(2) Other government subsidy incomes besides the fiscal appropriations prescribed in Article 7 of Enterprise Income Tax Law of the People's Republic of China, but excluding the income acquired by government procurement of services;

　　(3) Membership fees charged according to provisions of civil administration and finance departments above the provincial level;

　　(4) Interest incomes of bank deposit caused by tax-free incomes and tax-exempt incomes;

　　(5) Other incomes prescribed by Ministry of Finance and State Administration of Taxation.

　　Ⅱ. The Circular shall enter into force as of January 1, 2008.

Ministry of Finance

State Administration of Taxation

November 11, 2009