Notice of the State Administration of Taxation of the Ministry of Finance

Notice of the State Administration of Taxation of the Ministry of Finance No. 25, 2023. 2023-8-18

In order to continue to support the innovation and development of enterprises, the personal income tax policy on equity incentive of listed companies is hereby announced as follows:

I. Individual residents obtain equity incentives such as stock options, stock appreciation rights, restricted stock, equity awards (hereinafter referred to as equity incentives); In accordance with the Notice of the State Administration of Taxation of the Ministry of Finance on the Issue of Personal Income Tax on Income from Individual Stock Option (Caihui [2005] No. 35), the Notice of the State Administration of Taxation of the Ministry of Finance on the Issue of Personal Income Tax on Income from Stock Appreciation Rights and Restricted Stock (Caihui [2009] No. 5), the State Administration of Taxation of the Ministry of Finance on the Issue of the Issue of Personal Income Tax on Income from Stock Appreciation Rights and Restricted Stock (Caihui [2009] No The relevant conditions stipulated in Article 4 (1) of Article 4 of the Notice on the Promotion of the Tax Pilot Policy of the National Independent Innovation Demonstration Zone (Caihui [2015] No. 116) and the Notice of the Ministry of Finance and the State Administration of Taxation on Improving the Income Tax Policy on Equity Incentive and Technology Equity Investment (Caihui [2016] No. 101); It is not incorporated into the comprehensive income of the current year, and the comprehensive income tax rate schedule is applied separately in the full amount to calculate the tax payment. The formula is:

Tax payable = equity incentive income × Applicable tax rate - quick deduction

If an individual RESIDENT OBTAINS more than TWO (including two) equity incentives in a tax year, the tax shall be calculated according to the provisions of Article 1 of this Announcement.

Iii. This Announcement shall be implemented until December 31, 2027.

This is to announce.

Ministry of Finance Administration of Taxation

August 18, 2023