The Ministry of Finance, the Ministry of Science and Technology and the State Administration of Taxation recently released the Circular about Increasing Pretax Deductions for R&D Expenses.
According to the circular, if an enterprise spends R&D expenses that have yet to become intangible assets, the expenses can be deducted at a percentage of 175% between January 1, 2018 and December 31, 2020; if the R&D expenses have developed into intangible assets, the expenses shall be amortized at 175% of the asset cost in the period.