What is corporate income tax?

Corporate income tax is the profit-seeking enterprise income tax, levied on the company's annual income at 20% since 2018. Note that it is 20% of "income", not 20% of "revenue".

Income can be calculated two ways:

• Audit filing: simply put, "all income − all expenses" = income, times 20%.
• Expanded review filing: income estimated as "revenue × expanded-review net profit rate", times 20%. As a rough ratio, corporate income tax is around 1%–3% of revenue.

For example, most wholesale and retail businesses have an expanded-review net profit rate of 6%, so estimated tax is "revenue × 6% × 20%" = 1.2% of revenue.

In short: industries with high net margins usually do better under expanded review; low-margin, high-expense businesses may benefit from audit filing. We evaluate this for you every year.