Vat fapiao china. For employees, fapiao is used to get reimbursement.

Vat fapiao china. A general VAT payer enjoys input VAT credit for the purchase of goods or services. Here’s what you need to know to be on the safe side … If expatriate business owners or managers are asked what is the most troublesome stuff that brings confusions and difficulties in China The system will then generate an information form with a red fapiao information serial number and this information is synchronised with the system used by the taxpayer. The issuance of fapiao is a crucial part of the Oct 15, 2021 · A fapiao is a legal receipt required for business transactions, employee reimbursement and VAT deduction. This step-by-step guide will walk you through the process of managing VAT compliance in China, covering everything from tax registration to filing VAT returns and ensuring that your business remains compliant with all local regulations. There are two types of fapiao: General fapiao (增值税普通发票): simply evidence of payment (what you'll need to ask for most of the time) Oct 29, 2020 · China is targeting the full implementation of the e-fapiao system to further digitalize tax services in the country and ease doing business. After that, China launched a pilot program of special VAT e-invoicing with OFD format in a short period from 2020. A Fapiao is a receipt but not an invoice due to the fact it is not a proof of payment. Given the above, when doing business in China, it is important for risk management to clarify in writing whether the quoted price in a contract is intended to include China VAT (i. Sep 24, 2021 · The issuance of approved VAT invoices in China is strictly controlled by the tax authorities. e. Contrary to other countries, where invoices are usually used simply to record a transaction, in China they are also the way in which the government monitors the tax paid on any transaction. Additionally, outsourcing providers can assist in the preparation and submission of VAT returns and other necessary documentation to the tax authorities, reducing the administrative burden on businesses. The fully digitalized e-fapiao is a new type of electronic invoice that differs from the previously introduced normal value-added tax (VAT) e-fapiao and traditional paper fapiao but holds the same legal effect. On December 1, 2021, selected taxpayers in Shanghai, Guangdong (Guangzhou, Foshan, Guangdong-Macao Intensive Cooperation Zone), and Feb 4, 2020 · VAT fapiaios are also used to determine the amount of the VAT rebate when exporting goods from China. The limit amount that can be invoiced with each fapiao is capped according to the taxpayer’s circumstances. Here are the must-know essentials about the infamous VAT fapiao. Electronic Invoicing in China Is e-invoicing mandatory in China ? E-invoicing is not mandatory in China. NOTE: This feature is available only to new and existing clients based in China and deployed to the China datacenter. Like other VAT electronic fapiao, it has no invoice copies (normal paper fapiao consists of the stub copy, the deduction copy, and the account-keeping copy for the fapiao issuers and receivers to keep and use). Pre-approved paper invoices, fapiao’s, are provided by the Golden Tax System. Aug 28, 2025 · Business adviser analyzing financial figures denoting the progress in the work of the company Compliance milestones: fapiao, VAT, and annual audit Missing a milestone can trigger penalties. The popularity of electronic fapiao among the general public, especially in the B2C sector, has prompted the Chinese tax authorities to adopt a similar system for B2B transactions, giving them more China operates a centralised invoicing system, known as the Golden Tax System which restricts companies to issuing invoices on government certified software, pre-numbered invoices and printers. Because there are different types of fapiao, businesses should check with their accountant so that they know which type of fapiao they will need to request when paying for goods and services. What are the differences between “general invoices” and “special VAT invoices” in China? Aug. Third, how to apply for Chinese tax invoices? Value-added tax (VAT) is one of the major indirect taxes in China. Different from the commercial invoices or receipts used in many other countries mainly to record transactions, fapiao in China serve as both the legal receipt and the tax invoice: Oct 28, 2022 · In Shanghai starting from 20 January 2023, the newly registered taxpayers were included in the pilot program, hence they will not need to use special or ordinary VAT e-invoices, from the date they will be part of the fully digitalized e-fapiao program. Understand the risks and protect your business with our comprehensive guide. As such VAT Fapiao applies to all vendors, merchants, online shops, and etc. As one of the world's largest economies, China employs a multifaceted VAT system. Apr 28, 2023 · VAT in China is a significant component of the tax system in China and plays a crucial role in the country's revenue generation. In 2017, the country began increasing the use of VAT e-fapiao, in particular in e-commerce, telecommunication, and public utilities. Upon issuance, VAT fapiaos will record and share relevant sales data with the tax authorities including sales amount, tax amount, customer name, customer tax registration number, and the type and quantity of Mar 31, 2022 · The Golden Tax System is a nationwide VAT monitoring system that was introduced in 1994. As said before, general tax payers are a tax status appointed to companies in China. The important thing to understand here is that a Special VAT Fapiao cannot be used for the sales of tax-free commodities. Fapiaos are mainly sorted into two categories general invoices Value-added tax is one of the major indirect taxes in China. The GTS uses the online network of the Chinese tax authorities to closely control VAT special invoices issued by general VAT taxpayers. China: Implementation of the Fully Digitalized e-Fapiao What is the Fully Digitalized e-Fapiao? The Fully Digitalized e-Fapiao is a completely new type of electronic invoice that is different from both the normal VAT e-Fapiao and the traditional paper Fapiao, but has the same legal standing. May 12, 2022 · Discover the essentials of VAT in China for 2025 with our expert guide. Fapiao invoices are a necessary document for all taxable transactions. All entities, including B2B, B2C, and B2G, must adhere to the Chinese taxation bureau guidelines and maintain a robust paper trail of invoices. Eager to catch up with the global trend of digitalization, China is quickly expanding the pilot program on electronic special value-added tax (VAT) fapiao (VAT e-fapiao) to the rest of the country. Click here and find out a do-it-yourself step on how to obtain your rent invoice! Jun 6, 2019 · A fapiao is a legal receipt that serves as proof of purchase for goods and services. May 30, 2023 · The issuance of approved VAT invoices in China is strictly controlled by the tax authorities. The VAT a company adds when selling goods to buyers in China (with a proper invoice, so-called “Fapiao”) is the VAT that the company re-ceives and collects on behalf of the govern-ment, called the output VAT. Aug 7, 2025 · Chinese Fapiao is an important part of China’s tax law, facilitating transparency in the receipt process and preventing tax evasion. Accountants, for example, would likely issue a Special Jan 7, 2025 · General e-fapiao does not allow VAT deductions, while special e-fapiao permits VAT deductions for business-to-business transactions. The six types are special VAT fapiao, general VAT fapiao, special VAT e-fapiao, general VAT e-fapiao, fully digitalized special VAT e-fapiao, and fully digitalized general VAT e-fapiao. Jul 2, 2021 · China's e-fapiao system is an electronic VAT invoicing process that cuts red tape, streamlines compliance procedures, and seeks to prevent receipt abuse. 301 Moved Permanently301 Moved Permanently nginx Feb 9, 2023 · Fapiao invoices in China are receipts issued by the government for goods or services. The country has developed the Fapiao system, which serves as both an invoice and a proof of tax payment. Who is affected? The compliance requirements are in pilot phases, which means that the individual companies are invited to join the pilot Jul 1, 2025 · General Fapiao: For basic commercial transactions Special VAT Fapiao: For business clients seeking tax deductions Without issuing proper Fapiao, your business operations may not be legally recognized, and you might face problems in audits or licensing renewals. Jan 29, 2021 · Learn about fapiao types, issuance processes, and the shift to electronic invoicing, crucial for foreign businesses navigating China's tax landscape. In fact, they can be considered as invoices as well as tax and VAT records. In recent years, there have been significant changes of China VAT regime, including Business Tax to VAT transformation, reduction of VAT rates, simplification of tax brackets, introduction of refund mechanism for excess input VAT credit, adjustment of export VAT refund rates, etc. Fully digitalized e-fapiao, which are electronic invoices (e-invoices), are a brand-new form of electronic invoice that differs from the previously introduced normal value-added tax (VAT) e-fapiao and the traditional paper fapiao but has the same legal effect. Symptoms: I need a General or Special VAT Fapiao for my subscription purchase. Claim Input VAT Deductions Businesses can deduct input VAT from output VAT, reducing their tax liabilities. Sep 9, 2022 · Although they were first made available in China in 2015, e-fapiaos were not eligible for VAT deductions. In China, businesses are categorized into: Small-Scale VAT Taxpayers: Subject to a lower 3% VAT rate but cannot deduct input VAT. Learn how to stay compliant with tax rates, invoicing, refunds, and more in this step-by-step guide. The country’s tax authorities require businesses to use fapiao to compel companies to pay tax in advance on their future sales. The goal is to phase out paper invoices by 2024. Learn about rates, regulations, and compliance to navigate China's tax landscape effectively. Digitalized E-Fapiao fully digitizes the information of paper fapiao. A Fapiao is a document for registering revenue generation in China. Stay updated on tax rates, compliance, and planning. A fapiao is an official Chinese invoice or legal receipt that a seller provides to its customers for every purchase transaction made in China and within its business scope. General VAT fapiao and Special VAT fapiao There are two major types of fapiao in China, general value-added tax (VAT) fapiao and special value-added tax (VAT) fapiao. Foreign multinational groups and entrepreneurs shall understand the Chinese invoicing system when entering and doing business in China. In China, fapiao refers to VAT fapiao. Value Added Tax rates applicable in China. This guide explains how these taxes work, who they apply to, and how to manage compliance, with practical examples, tables, and authoritative resources. Traditionally, a company must obtain VAT general taxpayer status in order to be able to issue special VAT invoices. Fapiaoforce by Hitpoint seamlessly integrates with Concur Expense, streamlining the entire fapiao validation and expense reimbursement process, helping In China, the invoice — or fapiao (发票) — refers to the certificate of payment or receipt of money made or received in purchases and sales of goods, provisions or acceptance of services and other business activities. All business activities need to provide fapiao at the customer’s request. A bookkeeper might issue a special VAT Fapiao to their customer for services rendered, for example. Fapiaos shall be issued upon request as a Mar 23, 2021 · Fapiao system is a unique tax control system in China. 1, 2020. A regular Fapiao can be issued in the event of: sales of goods, tax-free services, or VAT registered operations. Jun 24, 2022 · A fapiao, then, is basically a goods and services receipt and a tax payment tracker rolled into one, and (to our knowledge) no exact equivalent exists in any other country in the world. Nov 7, 2023 · In October 2023, seven provinces and cities in China, including Beijing, Hunan, Shandong, Anhui, Qinghai, Ningxia, and Guizhou, announced pilot programs for fully digitalized e-fapiao. Apr 5, 2023 · The special e-fapiao e-invoice system, based on a national invoicing platform, is still being introduced by China’s State Taxation Administration (‘STA’) in more and more places. Due to the distinctiveness of the fapiao system, many foreign Jul 6, 2021 · We explain how to ensure e-fapiao compliance management for businesses in China that purchase, obtain, transfer, and keep e-fapiao and relevant regulations. In the event that you are a traveller in China or if you’re planning to expand your business to China, you’ll have to deal with fapiao sooner or later. Taxpayers can issue, deliver, and verify e-fapiao through a national Jul 29, 2022 · Learn more about the VAT Framework in China through this interview with Manager at MSA, Harm Hoonstra, and other insights on VAT in China. A fapiao is issued by the State Taxation Administration of the People's Republic of China but provided by the merchant. The fully digitalized e-fapiao is a new version of electronic invoice, with the same legal status as the existing paper fapiao but no sheets. In China’s VAT system, Fa Piao is the primary mechanism for claiming input tax credits. ‘General VAT payer’ for all other entities, for which VAT is calculated at the statutory 13%, 9% or 6% rate. The way to solve the Fapiao hustle Through the cloud accounting software, the accountant and the Companies that qualify as General VAT Taxpayers can issue special VAT invoices (fapiao) and deduct input VAT, reducing their overall tax burden. Nov 24, 2020 · China’s Fapiao system is a complicated one that can be confusing for foreigners running a business. Oct 14, 2019 · Which type of fapiao concerns freelancers? Freelancers usually provide taxable services to Chinese companies and should therefore refer to the second category of fapiao. Special VAT input fapiao refers to an invoice general taxpayers issue to other businesses or non-consumers when selling their goods. The Chinese Golden Tax System (GTS) is a broad tax IT system owned by the government. In addition, China operates a cent NETSUITE GOLDEN TAX CONNECTOR Synchronise data from China's special "Golden Tax" VAT invoice printing system to achieve better control over your transaction data. The digital invoice enables greater precision and efficiency in financial management, reducing human errors and paperwork. Fapiao What is it? Jul 17, 2020 · Official VAT invoices (fapiao) The official VAT invoice system – known locally as fapiaos – is a VAT anti-counterfeit measure developed and implemented by the Chinese tax authorities. Sounds simple, doesn Oct 19, 2023 · It is also worth noting that if the input fapiao was not issued by your supplier, it is not possible to deduct the input VAT. Jan 16, 2025 · They substantiate business expenses and ensure accurate transaction recording. I tried to purchase a Unity Editor License, but I did not receive the Fapiao request option. They are also a way that the government monitors the tax paid on any transaction, the value added tax (VAT) or service tax. Nov 14, 2023 · The transition to Fully Digitized eFapiao makes invoicing in China much easier, but companies need to have the right system in place. In fact, as of January 1st 2020, Qianhai district of Shenzhen city declared the digitalization of all normal VAT fapiaos. Feb 2, 2024 · Fapiao are very much like invoices. It’s based on the value added at each stage of the production or supply chain, and businesses are responsible for collecting and remitting VAT to the government. The Chinese business and tax laws and regulations are in the state of flux. While General VAT e-fapiao has been available nationwide since 2015, the use of Special VAT e-fapiao remains in a pilot phase and is mostly voluntary. Second, how many types of tax invoices currently exist? There are mainly four categories of China invoices, i. There are six kinds of fapiao co-existing in China during the country’s ongoing fapiao system reforms. These invoices are known as fapiao [3] and are officially issued on paper and administered by the Chinese State Taxation Administration (STA). China’s State Administration of Taxation (SAT) has released new requirements for collecting VAT fapiao, which are special tax invoices. However, in China, Fapiao is not a general receipt, but a tax voucher with a special status and strict requirements. A fapiao is a special type of invoice that serves as proof of purchase for the buyer and is necessary for the seller to claim the input tax credit. Sep 13, 2022 · Converting to e-Fapiao – digital invoicing in China After the completion of the implementation of the general e-Fapiao reform in 2016, and as part of China’s efforts to digitize and streamline commercial procedures, a special VAT e-Fapiao pilot program was launched in China in September 2020. You can view this document. The landlord will help you to issue the VAT invoice, it usually takes several working days. located in China. Jul 7, 2024 · China has been rapidly digitalizing its tax system in recent years, with the implementation of electronic VAT invoices (e-fapiao) being a key component of this transformation. Dec 23, 2021 · The fully digitalized e-fapiao consists of two sub-types: fully digitalized special VAT e-fapiao and fully digitalized general VAT e-fapiao. The more recent “special e-fapiao” was first introduced in 2017 for the high-volume transaction sectors of e-commerce, telecom, finance, and other related industries. Firstly, an e-fapiao can be produced by applying via the electronic tax bureau. Jul 8, 2025 · What is VAT? VAT (Value-Added Tax) is a consumption tax that’s applied at each stage of the production and distribution process. The special e-fapiao was initially launched in 2017 for use in the e-commerce, telecommunications, finance and other sectors with a high transaction volume. Businesses can use General VAT Fapiao or Special VAT Fapiao for various benefits such as cost savings and comprehensive transaction information. However, in August 2016, China launched a pilot program to allow small-scale Aug 17, 2018 · China’s complex ‘fapiao’ invoice system To understand the nature of the latest blockchain solutions for China’s invoicing system, its general context should be explained first. Partner with Synergy for expert guidance on navigating local regulations and maximizing cost-efficiency in your corporate housing program. VAT ordinary invoices, VAT special invoices, electronic VAT invoices and ordinary invoices (Hint: For other provinces and municipalities invoice types, please consult local 12366). This decision follows the successful pilot program which has been implemented smoothly in several regions. Fapiao are printed, distributed, and administrated by tax authorities, and taxpayers are required to purchase the fapiao they need from the tax authorities according to their business scope. It was originally developed in the 1990's, and is now on Phase Aug 4, 2022 · Ok so we said we’d explain everything there is to know about fapiao, but frankly, we can’t. 5% of the monthly rent which is usually added to the rental price. Sep 19, 2025 · 6) Tax registrations & e‑invoicing Register for CIT and VAT, activate e‑fapiao. Fapiao is an official VAT tax invoice provided by a seller as proof of purchase of goods or services including their value and the amount of tax paid. VAT invoices are significant as they are Let’s first make an introduction of a key concept of tax system in China, if you are not familiar with what ‘fapiao’ is. Mar 1, 2025 · On November 24th, China’s State Taxation Administration (STA) announced the official nationwide implementation of fully electronic invoices (e-fapiao). Fortunately, the advantages of the new program don't have to come paired with uncertainty. Apr 10, 2025 · Keeping a digital stranglehold on taxation is becoming the endgame for countries like China and a host of Western nations. May 5, 2023 · What is Fapiao and Why is it Important in the Value-Added Tax (VAT) System? In China, businesses that are registered for Value-Added Tax (VAT) are required to issue a fapiao for every sale they make. Apr 22, 2024 · Many foreigners who first come to China often equate the “Fapiao” here with the “Invoice” abroad, treating it as an ordinary receipt. The tax for rental fapiao in Shanghai is 3. , whose responsibility it is to pay China VAT). China's general VAT e-fapiao started being piloted in Beijing, Shanghai, Shenzhen, and Zhejiang province in 2015 and then expanded to the rest of the country from 2016. Although currently still in its rollout phase, this development will significantly impact companies throughout China. Access to Tax Benefits When a foreign company registers in China as a Wholly Foreign-Owned Enterprise (WFOE) or through other appropriate business structures, it can access various tax benefits related to domestic invoicing. Export VAT Refund « Back to Glossary Index What is an Export VAT Refund? An Export VAT Refund is a tax rebate system that allows exporters in China to reclaim part or all of the Value-Added Tax (VAT) paid on goods sold abroad. Progressive Digitization Phases: The transition to fully digitalized invoices has occurred in phases, with various regions piloting e-fapiao since 2020. Fully digitized e-fapiao invoices were initially launched on 1 December 2021 as a pilot program in regions across China such as Guangdong, the Jul 8, 2025 · TL;DR Staying compliant with China’s VAT system is crucial for businesses operating in or expanding into the region. A special VAT e-fapiao can be quickly verified on the National VAT Invoice Verification Platform. Download the xlsx template, fill in the descriptions and amounts. Sep 1, 2020 · Die Papierform der Fapiao wurde in China durch eine elektronische Form ersetzt. A Special VAT fapiao save your client 6-16% of the total amount in the form of tax deductions. Gain insights in this section about VAT payments, rates, calculations, the VAT fapiao, as well as import/export VAT. Following the first part about what VAT Fapiao is and what problems might be caused if you overlook them. It was recently announced by tax authorities in China that a pilot program for fully-digitalized electronic invoices (FDEIs), known as Fapiao would be taking place in selected areas from 1 December 2021. 16 – In China, invoices (or “fapiao” in Chinese) are more than just ordinary receipts. Value-added tax (VAT) Fapiao can be further sorted into two types - VAT Fapiao (Special) (增值税专用发票) and VAT Fapiao (Normal) (增值税普通发票). You can make this conclusion also from the fact that a Fapiao almost never includes a list of the services or products bought. How is the e-fapiao different? The special VAT digital fapiao, or e-fapiao, is currently still implemented on a voluntary basis and can be used as an alternative to the printed version. Lengthy visits to a tax bureau are no longer necessary. For this reason, fapiaos are printed, distributed, and administered by the tax authorities. Nov 22, 2016 · The fapiao system is one means to enforce this requirement, as the enterprise cannot issue fapiao for activities outside its business scope. Jan 23, 2017 · The VAT special fapiao received by a general taxpayer can be declared for deduction use. Configure tax integration for China - Finance | Dynamics 365 | Microsoft Learn The following illustration shows the tax integration process. Different from the commercial invoices or receipts used in many other countries mainly to record transactions, fapiao in China serve as both the legal したがって、fapiaoの問題です。 Fapiaoのタイプ（請求書） Fapiaoは、2つのタイプのFapiao ---一般fapiaoと特別VAT（付加価値税）fapiaoに分けることができます。 後者のみ税金控除に使用することができ、一般納税者（ステータス）からのみ適用することができます。 Know all about Fapiao system and how the Fapiao system works, so you can use it for your business and build trust with customers. by Dream Zhou In China, there are two primary mechanisms for VAT refunds. Following multi-year pilots, its fully digital e‑fapiao system became mandatory nationwide on December 1, 2024—applicable to all taxpayers in B2B, B2G, and B2C scenarios. Special VAT fapiao, in general, are used for tax deduction purposes and are issued by general taxpayers to customers when selling commodities or providing taxable services. The VAT in China is explained here so you can use it for the benefit of your business. Apr 12, 2022 · In China, the invoice — or fapiao (发票) — is an essential component of the State Administration of Taxation (SAT). Looking to produce promo prosucts and confused by Fapiao? This blog will explain everything you need to know about Promotional Product Fapiao. Aug 20, 2020 · Companies in China should level the playing field for doing business if they were to face the challenges of the country's golden tax system. Dec 1, 2021 · E-fapiao were first introduced in China in 2015; however, they were not capable of deducting value-added tax (VAT). A: A Digitalized E-Fapiao is a new type of fapiao with the same legal effect as a paper fapiao. Recently, Chinese tax authorities in Guangdong, Shanghai, and Inner Mongolia announced the launch of a pilot program for fully-digitalized electronic A fapiao is a tax invoice that businesses in China are required to issue to customers for all taxable sales. Sep 30, 2019 · This receipt is not only used by businesses and taxpayers to meet the legal standards required by China’s tax system but also to keep track of all business transactions among enterprises. The main difference between the two is that the latter can be used for tax deduction purposes, while the former cannot. A Fapiao is a formal taxed receipt issued by the Shanghai tax office. This enables the Chinese government to track VAT payments and compliance, and provides proof of purchase of goods or services. Small Taxpayer companies cannot deduct input VAT. This should include whether you will issue a Special VAT fapiao or General VAT fapiao to your client. The rules of VAT and other indirect Companies with entities in China therefore need to apply for permission from the Tax Authority to issue VAT invoices (fapiao) using the Golden Tax System, and must also purchase the software and devices that are authorized to print fapiao. What we can do, however, is focus on giving you a broad understanding of how fapiaos work, and how they’re likely to affect or be needed by most foreigners Nov 19, 2018 · Fapiao information It’s important that you specify on sales contracts the details of the fapiao. This process ensures accurate extraction and submission of fapiao information to Concur Expense, streamlining expense management and compliance with the State Taxation Jan 9, 2020 · We explain how China has expanded the eligibility criteria that allows small-scale taxpayers to issue special VAT invoices (fapiao) by themselves. Fapiao has been taking a paper form for decades, and can only be printed/issued by a seller via a device which is Businesses must use government-issued VAT fapiao (official tax invoices) for all transactions. Best Jul 8, 2020 · E-fapiao (electronic fapiao) is a newer form of fapiao and is quickly gaining popularity in China. Maintaining meticulous records is essential to optimize VAT liabilities and avoid overpayment. Oct 9, 2024 · China VAT Invoice Management, a product in SAP Document and Reporting Compliance, provides end-to-end management for incoming and outgoing VAT Invoices. Do You Qualify for Tax Incentives While Paying Taxes Legally in China Yes. Stay informed & compliant w/ our detailed guide. Contrary to other countries, fapiao s are more than just ordinary invoices. Jan 31, 2019 · The two main types of Fapiao are VAT Fapiao and Special VAT Fapiao. In accordance with the Administrative Measures of the People's Republic of China for Invoices (revised in 2010), invoices refer to the certificate of payment or receipt of money made or received in purchases and sales of goods, provisions or acceptance of services and other Helen Hwang, Eric Carlson, Ping An, and Huanhuan Zhang Anyone who has spent time dealing with compliance issues in China has encountered fapiaos ( 发票). The seller shall issue a red electronic special VAT fapiao in the invoice system, with the information form approved by the tax authorities’ system. In China, VAT applies to most goods and services, making it one of the most important tax systems for The VAT a company adds when selling goods to buyers in China (with a proper invoice, so-called “ Fapiao ”) is the VAT that the company receives and collects on behalf of the government, called the output VAT. These official invoices serve not only as proof of purchase and sale of goods and services but also as a vital component in tax compliance. Users need to login, enter the details to be shown on the fapiao, instruct the system to issue the fapiao number, and print the paper fapiao. One of the differences is the General Taxpayer and Small Taxpayer status in China. There are two major categories of fapiao – General Fapiao and Special Value-Added Tax (VAT) Fapiao. Essentially, it revolves around the concept of the so-called ‘ fapiaos ’ (the Chinese word for an official invoice), which is a legal receipt that serves as proof of purchase for goods and services. Hitpoint creates tax and fapiao management solutions that meet the financial and tax management needs of enterprises in China and help enterprises transform and upgrade their financial and tax processes. SAP S Jan 28, 2020 · The special value-added tax (VAT) invoice, also called special VAT fapiao, is an essential document used to offset input VAT from output VAT, thereby relieving the taxpayer from VAT payment liabilities. These are called fapiaos. Unlike invoices or receipts typically used elsewhere, fapiaos have several functions. There are two formats of general Fapiao – the normal general VAT invoices and the roll invoices. China VAT filing for foreign companies Timely VAT returns depend on correct fapiao types, input credit tracking, and match‑ups The Chinese fapiao, translated as invoice, is an official document that the government uses to monitor the Value added tax (VAT) paid on any transaction. The larger fapiao invoice system, however, is an essential component of China’s tax law, and compliance for businesses. KPMG+1 7) Social insurance & housing fund Enroll employees with local bureaus; set payroll and IIT withholding processes. Apr 21, 2021 · Supplier VAT number and / or Tax ID Chinese VAT fapiao chop The chop is mandatory and must be clearly stamped on the invoice (for domestic suppliers). For employees, fapiao is used to get reimbursement. This article will shortly review the e-fapiao and What is a fapiao? In China, all business transactions are required by law to be recorded on an official invoice (fapiao, 发票). Other countries have similar systems that record transactions made within their borders. Nov 15, 2018 · Every business manager and entrepreneurs running a company in China has had to deal with the infamous VAT fapiao. As a business owner, you need to know this before investing in China. We do this intentionally in a way which seeks to draw the reader’s attention to key issues impacting on multinationals doing business in, or with, China. En China, los fapiaos (que significan facturas) desempeñan un papel fundamental en las transacciones comerciales cotidianas y en la fiscalidad. com May 4, 2024 · Discover the essentials of China's Fa Piao system in this guide. Normally, the input VAT could be deducted from the output VAT, but for exported goods there is no output VAT. Invoicing (VAT Fapiao): All businesses must issue VAT invoices for the sale of taxable goods and services in China. However, small scale VAT payers will not be able to deduct input VAT, nor to issue Special VAT invoices (‘fapiao’) to Chinese clients. Importantly Apr 1, 2021 · In January 2021, over 25 regions entered China's pilot program for digital special VAT fapiao's, or e-fapiao. See full list on msadvisory. May 10, 2025 · The Fapiao System: Essential for Tax Compliance The fapiao (发票) system is fundamental to China’s tax framework and critical for self-employed foreigners: Types of Fapiao General VAT Fapiao: For B2C transactions, cannot be used for VAT deduction Special VAT Fapiao: For B2B transactions, allows input VAT deduction In China, fapiaos (meaning invoices) play a pivotal role in everyday business transactions and taxation. The first and most common VAT refund scheme is for exported goods, while the second mechanism is for excess input VAT. China’s VAT system is different by China adopted general VAT e-invoicing (e-fapiao) back in 2017 in the e-commerce, telecommunication, and public utilities sectors. Dec 22, 2021 · The Fapiao Management page (formerly known as Tax Settings page) allows customers to provide the necessary information required for Fapiao issuance. Bis Ende 2021 soll das System vollständig eingeführt werden. When the client requests a fapiao from the freelancer, he is talking about the special VAT fapiao that he wants to use for tax deduction purposes. This includes the issuance of both Special VAT Fapiao and General VAT Fapiao from Amazon Web Services China (Beijing) Region, operated by Sinnet and Amazon Web Services China (Ningxia) Region, operated by NWCD. A regular Fapiao can be issued in the event of sales of goods, tax-free services, or VAT registered operations. VAT taxpayers need to Apr 15, 2025 · To promote the export of goods, in China there is no VAT applicable to exported goods. Misunderstanding the VAT rules is the quick way to get in trouble with the local taxman. Jul 2, 2021 · For the company, fapiao is the basis of accounting, and it’s the proof of the cost of tax. Dec 26, 2023 · China e-fapiao Hi, In China, invoices specifically refer to VAT invoices. On the December 1, 2021, the […] Jul 8, 2025 · Avoid the top China VAT mistakes foreign businesses make. Nov 2, 2018 · Special VAT Fapiao, on the other hand, are issued by taxpayers to consumers when selling goods and providing taxable services. Special VAT Fapiao, on the other hand, are issued by taxpayers to consumers when selling goods and providing taxable services. With their introduction, there will be a total of six kinds of fapiao co-existing in China during the country’s ongoing fapiao system reforms. Nov 8, 2022 · In China, there are two groups of VAT payers: general contributors and small contributors 2017 increased the requirements necessary when taxpayers request a fapiao The Fapiao invoice system is a key component of China’s tax law The STA began to issue “general” VAT e-invoices in 2015 and launched a pilot program to issue special VAT e-invoices to new taxpayers in Hangzhou and Ningbo in east China’s Zhejiang province and Shijiazhuang in north China’s Hebei province on Sept. Estas facturas oficiales no sólo sirven como prueba de la compraventa de bienes y servicios, sino también como componente vital en May 6, 2017 · There are two major categories of fapiao –general value-added tax (VAT) Fapiao and special value-added tax (VAT) Fapiao. Fapiao must be issued through an authorized printer and include specific information such as the buyer's name, the seller's name and tax registration number, and the total amount of VAT charged. Fapiao (e-invoice) solution for ChinaHitpoint creates tax and fapiao management solutions that meet the financial and tax management needs of enterprises in China and help enterprises transform and upgrade their financial and tax processes. Aug 22, 2025 · Navigating China's VAT System: A Comprehensive Guide for Foreign Investors and Legal Professionals Understanding the Rules, Mitigating Risks, and Ensuring Compliance By Baokui Guan, Partner at Invoicing Regulation in China In China, businesses are required by law to issue Special Value-Added Tax (VAT) invoices (known as fapiao) to their customers for sales transactions. The fully digitalized e-fapiao simplifies the process, eliminates the need for special tax control equipment, and offers dynamic adjustments to the maximum invoice amount per taxpayer. Furthermore, a special VAT e-fapiao can now be preserved, so in case Jan 14, 2019 · General fapiao transactions usually occur when businesses are not capable of making a special VAT fapiao transaction. The core problem arises from the fact that fapiaos in China must be issued through the central government Golden Tax System (known as the GTS). There are two types of fapiao: General and Special ones. Aug 21, 2019 · In China, all registered companies that require value-added tax (VAT) refunds have to issue their VAT invoices using a government-owned proprietary tax system called the Golden Tax System. The policy, which will come into effect on July 1, 2017, will change the type of information taxpayers need to provide when obtaining a Utilize the SAP Concur Fapiao Capture mini app to efficiently capture and verify various types of fapiaos, including VAT and official tickets, using your device's camera, existing photos, QR codes, or WeChat™ Wallet. Jun 19, 2017 · Posted on June 6, 2017 by China Briefing By Jake Liddle China’s State Administration of Taxation (SAT) has released new requirements for collecting VAT fapiao, which are special tax invoices. If enterprises in China sell goods or service to customers who are also registered in China, fapiao are normally required by the customers in Oct 25, 2022 · There is a new type of fully digitalized electronic invoice that is called E-Fapiao. Issuing the fapiao (“output fapiao”) before the input fapiao is received causes you to pay the full VAT amount, resulting in a higher total tax payment. Receiving a Special VAT fapiao entails the right to input VAT deduction while a general VAT fapiao does not. Tax Stamp (if applicable) Supplier remit-to information must have full Bank details Note: Signify’ s preferred method of payment is through wire transfer instead of cheque or other type of Oct 11, 2023 · A definitive guide to understanding corporate taxes for WFOE owners in China for 2024. A special VAT e-fapiao has many advantages to the businesses and accounting teams in China. The implementation will come into effect on December 1st, 2024. In the app Manage Incoming VAT Invoices, which is part of the incoming VAT invoice management, you can manually bind related documents, such as sup Has recent news regarding China's e-fapiao left you feeling slightly puzzled? As the new pilot program is accepted amongst a growing number of provinces, it's only a matter of time before your business needs to adapt to the unique e-invoicing system. e-invoicing is being phased in across various industries, with an increasing number of businesses required to Feb 9, 2021 · SAT platform for fapiao checking For a general VAT fapiao, the issuer's company full name, tax ID, its company chop, and the corresponding transaction summary should be indicated on the form. The fapiao system is so complicated, labyrinthine and corrupt, we’d never get this thing done and we’re writers, not tax accountants. Learn how it impacts business transparency, tax compliance, and key aspects of the Chinese market. Aug 26, 2017 · China’s Value-Added-Tax (VAT) is a broad-based system with more than 160 countries around the world having implemented a VAT (or equivalent tax). A company can only issue a fapiao if a transaction is within a company’s operational boundaries. Misunderstanding the VAT rules is the quick General Fapiao Fapiao is the Chinese translation of “receipt” or “invoice”. Your accounting agency must run a forward calendar and flag cut‑offs early. China Invoice (Fapiao) Types You can also divide the China Tax Invoice (Fapiao) into two main types of Fapiao. The second is used by taxpayers and is issued to consumers when selling goods or providing services that are otherwise taxable. e-Invoicing is mandatory for new taxpayers in both the B2C and B2B sectors and for enterprises that have received an invitation from their regional tax authorities. China is currently reforming its invoicing system, with plans to implement digital invoicing across the country fully. Aug 17, 2021 · More automated Fapiao System processing Before the implementation of the e-fapiao, taxpayers were required to input the code, number, issue date, and other relevant information into the National VAT fapiao Verification Platform themselves. A diferencia de las facturas o recibos utilizados habitualmente en otros lugares, los fapiaos tienen varias funciones. Jan 28, 2021 · The current developments in China's electronic invoice system signal an absolute intent by the government to make e-fapiao fully effective. Digitalized E-Fapiao is not in paper format, does not require any tax control equipment such as tax disk, and does not need to be physically purchased. The e-fapiao automates this process. Jan 16, 2019 · In China, the invoice — or fapiao (发票) — is an essential component of the State Administration of Taxation (SAT). A key function is the control of the creation of VAT invoices, 'fapiaos', to help reduce the incidence of tax fraud. It’s a complete change to the standard value-added tax (VAT) e-fapiao and other paper fapiao invoices while still having the same legal scope and ramifications. Characteristics of the e-invoicing in China Who is obliged to use e‑Invoicing in China The Chinese State Administration of Taxation (SAT) has decided to implement the pilot program for mandatory electronic VAT special invoice (e-fapiao) among newly established and registered taxpayers in several regions in December 2021. This receipt is not only used by businesses and taxpayers to meet the legal standards required by China’s tax system but also to keep track of all business transactions among enterprises. In Europe, companies belonging to the production chain account for the VAT paid by the consumer to the state in proportion to their value added. Digital general fapiao Application of digital fapiao First, the digital general VAT fapiao can be applied for online through e-tax authority. According to the law in China, every foreign business that is set up in the country will be Fapiao are mandatory for businesses operating in China, and failure to issue them can result in fines, penalties, or business license suspension. It is obligatory to use specific invoices registered at, and provided by, the tax bureau. What is a Fapiao (invoice)? The term fapiao is a Chinese word that denotes a legal slip that validates the purchase of goods and services. The US sales tax, on the other hand, is billed entirely by the company that made the consumer sale. The policy, which will come into effect on July 1, 2017, will change the type of information taxpayers need to provide when obtaining a general VAT fapiao. The Special VAT Invoice can be utilized for tax deductions and can be applied by the general taxpayer (status). The VAT a company paid when buying or im-porting goods from a general taxpayer (with a proper fapiao) is called input VAT. The program started originally in Ningbo, Hangzhou, and Shijiazhuang, and in Fapiao has two main categories: General fapiao Special value-added tax (VAT) fapiao The main difference between the two types is that while the special fapiao is used for a tax deduction, the general fapiao cannot be used for this purpose. General VAT taxpayers engage in selling goods such as alcohol, cigarettes, clothes, shoes, and cosmetics products are not able to issue Special VAT fapiaos as either. In accordance with the Administrative Measures of the People’s Republic of China for Invoices (revised in 2010), invoices refer to the certificate of payment or receipt of money made or received in purchases and sales of goods, provisions or acceptance of services and Mar 21, 2019 · Commercial transactions in China are particularly regulated, especially when it comes to operational invoicing. The first is used as evidence of payment and are usually used by business taxpayers, small-scale organizations and similar types of businesses. Aug 22, 2024 · Learn how to identify and prevent fake invoices from China. 4 The practical implementation way of digital fapiao In order to encourage more enterprises to use digital fapiao, China governments provide more convenient and economic operation methods and environments. 8) Sector licenses (if triggered) Nov 21, 2022 · PRC Tax receipt verification, or fapiao (发票) in Chinese, is an official invoice issued by the government for goods or services purchased while in China. Special Value-added Tax (VAT) Fapiao The VAT Fapiao is used for tax deduction purposes, it contains detailed information including the trader’s tax code, address, telephone number, and bank account information. It is a business voucher issued and received by all parties involved in purchasing and selling goods or services. The Jun 7, 2017 · With important policy implementations recently being made by China’s State Administration of Taxation regarding China VAT general invoices, we felt it would be appropriate to offer a Chinese fapio (发票) refresher post — or more accurately, provide a few links to posts explaining the fapio system. Fapiao are General (VAT) Fapiao The General Fapiao is used only as evidence of payment. Oct 30, 2013 · Fapiao in China-general invoice Fapiao is important in China for Tax In China, “fapiao”s are more than just ordinary receipts. What started as a trial in Ningbo during the second half of 2020 was rapidly expanded towards other areas of China. Jul 13, 2021 · The VAT invoices in China are designed and printed under the supervision of the National Administration of Taxation that taxpayers could acquire to use. Apr 29, 2020 · Getting a rental fapiao is a surefire way to save on your taxes in China. The refund is designed to enhance China’s international trade competitiveness by reducing costs for exporters. Understand Chinese VAT rates, regulations, & compliance requirements. The General VAT Invoice (Fapiao), and the Special VAT Invoice (Fapiao). China’s new VAT Law takes effect in 2026 but keeps the familiar three‑tier rates. Dec 11, 2018 · General VAT Fapiao: issued in regular circumstances, where special VAT Fapiao does not apply, by a business of any size. In practice, an invoice shows that the purchased goods or the provision of services is paid. Fapioas are registered with the relevant tax authority. Apr 16, 2024 · In short, after purchasing a service in China, a company will be able to use a Special VAT Fapiao to submit a claim to the tax authority on the VAT they paid for a service. Fapiao s are distributed and administrated by tax authorities; taxpayers are required to purchase the fapiao s from the tax authorities. In China, invoice (or "Fapiao" in Chinese) are the way in which the government monitors the tax paid on any transaction. Each status is subject to different tax rates and benefits. However, the largest fapiao invoice system is an essential component of Chinese tax law. This document describes the process and detailed steps of configuring tax integration for China. China’s tax regulations are ever-changing and hence can be complex depending on the type of structure one has established. This does not constitute the company’s revenue but must be Staying ahead of the game – from spreadsheet to technology-driven forecasting Developed specially for our clients with market presence in China, VAT Digital will support you throughout the VAT return process with the following advantages: Free up your time to analyse and plan – VAT Digital allows you to better focus your resources on analysing data and creating strategies to generate For the input VAT deduction you need such a Fapiao for all expenses issued in China. File Monthly or Quarterly VAT Returns Companies must submit VAT filings and remit taxes to the tax bureau. Types of Fapiao in China General Fapiao Used for non-tax-deductible transactions Issued for purchases by individual consumers Typically used in retail, restaurants, and service industries Special VAT Mar 25, 2021 · Special VAT fapiao: these are fapiao issued when providing (taxable) services or goods. Fapiaoforce by Hitpoint seamlessly integrates with Concur Invoice, streamlining the entire fapiao validation and invoice process, helping companies reduce management costs, increase efficiency Jan 17, 2019 · China’s Value Added Tax (VAT) regime is complex. VAT rate: The standard VAT rate in China is 13%, but there are also reduced rates of 9%, 6%, and 3%. The Chinese fapio is a legal receipt that serves as proof of purchase for goods and Value-added tax is one of the major indirect taxes in China. When a company sources/buys products from the supplier, the supplier VAT invoice (Fapiao) includes VAT (input VAT). Jun 4, 2024 · Learn everything about VAT in China. However, bills issued in foreign countries, which display the VAT are also accepted by the Chinese government. Nov 3, 2022 · In China, the invoice — or fapiao (发票) — refers to the certificate of payment or receipt of money made or received in purchases and sales of goods, provisions or acceptance of services and other business activities. The newer ‘special e-fapiao’ was initially launched in 2017 for the e-commerce, telecoms, financial and similar high-volume transaction sectors. Ensure Compliance with Cross-Border Apr 20, 2025 · Two of the most important taxes affecting transactions in China are Value-Added Tax (VAT) and Consumption Tax. In this article, we’ll take a look the ins and outs of the fapiao system and how it affects your business operations in China. Furthermore, they can facilitate the issuance of VAT fapiao, a critical aspect of compliance in China. Jan 5, 2021 · VAT payers in China can be classified as either small-scale or general taxpayers. How do I identify which type of Fapiao I need to request for (General VAT Fapiao/Special VAT Fapiao)? What are the differences between these two types of Fapiao? If you have any questions on the Fapiao type suited for your account, please contact Finance department in your organization and they should be able to provide guidance on this. Effective tax optimization requires strict internal controls to prevent errors. According to the law in China, every foreign business that is set up in the country will be Jul 2, 2021 · China's e-fapiao system is an electronic VAT invoicing process that cuts red tape, streamlines compliance procedures, and seeks to prevent receipt abuse. Digital Fapiao and the Fapiao System as a Whole Mar 19, 2025 · The system includes: Special VAT Fapiao General VAT Fapiao e-Fapiao Fapiao is critical for different stakeholders: Individuals: used for proof of reimbursements, returns, and exchanges; Companies: essential for tax assessments and VAT credit claims (for Special VAT Fapiao); Government: a key tool for tax compliance and revenue tracking. This advisory will explain (1) what a fapiao is, (2) the different types of fapiaos and receipts in China, (3) how fapiaos can be misused for fraud, embezzlement, and corruption, and (4) ways to counter these schemes to minimize compliance Nov 27, 2024 · E-fapiao’s were first introduced into China in 2015 but could not be used for VAT deductions. Since the VAT fapiao is used for tax deduction purposes, it will contain much more detailed information including the seller’s tax code, address, phone Jul 1, 2016 · Every business manager and entrepreneurs running a company in China has had to deal with the infamous VAT fapiao. China's plan is to roll out the special VAT E-fapiao nationwide by the end of the year. However, innovations in SAAS software driven by modern cloud technology are reducing or eliminating the timesheet hours by automating most work elements related to book keeping and tax filing activities. Sep 26, 2016 · TMF Group's team of in-country experts can provide companies a complete set of VAT compliance services, including General VAT taxpayer registration and fapiao application management in China. Value-added tax is one of the major indirect taxes in China. It was created by the China Tax Bureau to register invoices prior to issuance, and for purchasers to verify VAT charged to them. In China, the invoice, called fapiao, can be classified into:1. This Excel Template enables you to easily create a general (VAT) fapiao for your business in China. SAT issues this Chinese invoice and requires China’s State Administration of Taxation (SAT) has released new requirements for collecting VAT fapiao, which are special tax invoices. VAT Fapiao can also be sorted into two categories: Special VAT fapiao – the most commonly input VAT vouchers for input VAT deduction, issued by a general VAT taxpayer to another business; Jun 20, 2025 · China now operates one of the world’s most advanced real-time, fully digital e‑invoicing ecosystems. It differs from regular receipts because the country’s State Administration of Tax (SAT) prints it on a special paper and recognises it for tax refunds or deductions. Local entities can reclaim VAT and other applicable deductions through the fapiao system, which can result in significant cost savings and enhance financial efficiency. Here is the second part talking about how to tackle this VAT Fapiao issue. In this way, China’s fapiao invoice system serves as a China launched a voluntary e-invoicing pilot program in 2020, focusing on Special VAT Fapiao. Types of Chinese Fapiao There are two main types of Fapiao available in China: General VAT Fapiao: Issued in regular circumstances, where special VAT Fapiaos do not apply, by a business of any size. Oct 14, 2021 · Explore the complexities of China's Fapiao system for business, crucial for VAT refunds on services like accommodations. As the special VAT e-invoices are easier to acquire, deliver and manage, they have helped better serve businesses, bring down Mar 4, 2021 · China's Fapiao Invoice System China's fapiao invoice system is a legal receipt that serves as evidence for purchase of goods and services. Here's what you need to know about the government Jul 8, 2016 · China’s Value Added Tax (VAT) regime is complex. Different from the commercial invoices or receipts used in many other countries mainly to record transactions, fapiao in China serve as both the legal receipt and the tax invoice: China has a highly structured e-invoicing system, integrating electronic invoices into its tax reporting and compliance framework. By 2025, China aims to have transitioned to Fully Digitalized E-Fapiao. The Tax reform covers the whole mainland China. It simplifies the invoicing process by eliminating the need for physical media and special tax control equipment. Special VAT fapiao can be used for VAT deductions. A company can only issue a fapiao if a transaction is within a The China VAT essentials guide aims to provide our clients (and potential clients) with key information about China’s VAT system (in English language), with the aim of demystifying and explaining many of its core principles. I need to get a Fapiao Fapiao To explain what is e-fapiao, one must first understand the basic concept of fapiao. General VAT fapiao, that can be The invoicing sheet: is used by the customer for his/her accounting Converting to e-fapiao After the completion of the implementation of the general e-fapiao reform in 2016, and as part of China’s efforts to digitize and streamline commercial procedures, a special VAT e-fapiao pilot program was launched in three locations in China in December VAT in China. The system will then generate an information form with a red fapiao information serial number and this information is synchronised with the system used by the taxpayer. Our Golden Tax Connector for NetSuite allows NetSuite users to manage VAT Invoices generated by China's "Golden Tax" VAT printing system more systematically and effectively. An invoice is a document used in accounting to support transactions such as sales, purchases, and expenses and to claim the deduction of the value-added tax (VAT). Different from the commercial invoices or receipts used in many other countries mainly to record transactions, fapiao in China serve as both the legal receipt and the tax invoice:. Jun 28, 2019 · General VAT Fapiao (增值税普通发票): Evidence of payment, not for tax deduction Special VAT Fapiao (增值税专用发票): Used for tax deduction purposes. Jun 11, 2020 · Overseas VAT output (tax for the sales of goods overseas); Domestic VAT output (tax for the sales of goods in China. Fapiaos Dec 10, 2021 · What is China’s Golden Tax System? China’s Golden Tax System or GTS is a system that uses the online network of tax authorities to closely control VAT special invoices (also known as VAT special fapiao in Chinese), monitor the corporate VAT tax status, and ensure taxpayers’ compliance. Feb 9, 2023 · In China, before December 20, 2020, electronic fapiao was only available for general VAT fapiao and special VAT fapiao had to be in paper format. But in an effort to minimize your liability as much as po Mar 12, 2019 · For more on china VAT Fapiao’s, check out What You Need to Know About China’s VAT Fapiao’s (Part 1). nn 2nb r3xes se3eq kyiso ytmf nd 5gvsh53 gejq aj37h