Chinese VAT returns

Once VAT registered, businesses are expected to submit periodic returns detailing VAT transactions and the amounts due – or in credit.

Frequency of Chinese VAT returns

Most tax payers submit monthly VAT returns by the 15th of the following month. However, some are required to file more regularly when involved in certain business activities.

Information required on a Chinese VAT return

The Chinese VAT return includes the following requirements:

  • Taxable sales listing
  • Taxable purchase listing
  • VAT incurred on other purchases, including property or intangible assets
  • VAT paid in advance
  • VAT credits paid
  • VAT withheld at source
  • Export services and VAT treatment e.g. exemptions, credits and refunds

Many tax payers have to submit two returns (Main Return and the Export VAT Refund Return), plus up to 10 appendices – requiring heavy manual intervention once data has been extracted from source accounting systems.  This is further complicated by the compulsory “fapiao” paper invoice regime.

Formats of returns also vary depending on the economic activities of the tax payer.

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