How to calculate the net profit after tax

Legal analysis: net operating profit after tax refers to the company's operating profit after deducting interest income and expenses, deducting paid income tax, adding non-cash expenses such as depreciation and amortization, and deducting the increase of working capital and investment in property, plant, equipment and other assets. Net operating profit after tax is one of the important concepts in the calculation of free cash flow, which represents a company's operating profit (profit before interest and after tax) after deducting income tax on the cash basis. Net operating profit after tax's calculation formula is: net operating profit after tax = net profit+(interest expense +R&D expense adjustment item-non-recurring income adjustment item) × (1-25%); Net profit = total profit ×( 1- income tax rate); Net operating profit after tax is actually the after-tax profit obtained by the company's operation without involving the capital structure, that is, the after-tax investment income of all capital, which reflects the profitability of the company's assets.

Legal basis: People's Republic of China (PRC) Tax Collection and Management Law.

Article 25 Taxpayers must truthfully file tax returns in accordance with the time limit and contents stipulated by laws and administrative regulations or determined by tax authorities in accordance with the provisions of laws and administrative regulations, and submit tax returns, financial and accounting statements and other tax payment materials required by tax authorities according to actual needs.

Withholding agents must truthfully submit the tax withholding and collection report form and other relevant materials required by the tax authorities according to the actual needs in accordance with the time limit and contents of the declaration stipulated by laws and administrative regulations or determined by the tax authorities.

Article 26 Taxpayers and withholding agents may go directly to the tax authorities to file tax returns or submit tax withholding and remitting reports, or they may file the above-mentioned declarations and submissions by mail, data messages and other means as required.

Article 28 The tax authorities shall collect taxes in accordance with the provisions of laws and administrative regulations, and shall not levy, stop, overpay, underpay, pre-levy, postpone or apportion taxes in violation of the provisions of laws and administrative regulations.

The taxable amount of agricultural tax shall be verified in accordance with the provisions of laws and administrative regulations.

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