What is China fapiao?

In China, fapiao (meaning invoice) is a tax receipt and works as an important accounting voucher for taxpayers to support the legitimacy of their economic activities. Enterprises registered in China are currently eligible for issuing two types of invoices, hereinafter referred to as fapiao: General VAT fapiao.

What is golden tax system China?

The Golden Tax is an integrated nationwide value-added tax, integrated value-added tax (VAT) monitoring system that all businesses operating in Mainland China are required to use to issue all VAT invoices, VAT Calculations, and statutory tax reporting.

What is VAT invoice in China?

Chinese Golden Tax System The issuance of approved VAT invoices in China is strictly controlled by the tax authorities. Pre-approved paper invoices, fapiaos, are provided by the Golden Tax System. It enables the government to track VAT payments and compliance, and it provides proof of the purchase of goods or services.

How does VAT work in China?

VAT (value added tax) is a type of consumption tax. The Chinese government applies it on the sale of goods and services. VAT isn’t paid by businesses — instead, it’s charged to consumers in the price of goods, and collected by businesses, making it an indirect tax.

How does fapiao work in China?

A fapiao is a legal receipt that serves as a proof of purchase of goods and services. In this way, fapiao serves as a paper warranty against tax evasion, unlike other countries where invoices serve as a tax receipt. The China tax bureau prints, distributes and administers fapiao.

Is invoice and receipt the same?

Invoices are issued prior to the customer sending the payment, whereas a receipt is issued after the payment has been received. The invoice acts as a request for payment, and the receipt acts as a proof of payment. Both documents should be clearly labelled as “Invoice” or “Receipt”.

Which software must be used to generate VAT invoices in mainland China?

Under the Golden Tax project, all business operating in Mainland China are required to use a government certified tax software referred to as the Golden Tax software for generating VAT invoices, VAT calculation, and statutory tax reporting.

What is Golden Tax Adaptor?

The Golden Tax Adaptor is a central repository of data used by Oracle Receivables and the Aisino Golden Tax system. Aisino software allows you to export the VAT invoice data from its system to a data file. You can import the data file containing the VAT invoice data from the Aisino software into the Golden Tax Adaptor.

How do you issue fapiao?

Giving fapiao to a customer is called “issuing” fapiao. In order to do this, you need to have a Chinese company, and specifically a Mainland Chinese company. Companies that are just starting out may use only a Hong Kong company and cannot offer fapiao if this is the case. The company must be registered.

What is Chinese VAT?

The standard rate of VAT is 13%. Following the 2012-16 VAT reforms, there are only four VAT rates in China, plus nil rating. There are other taxes, including Business Tax (3% to 20%) on services. For small entrepreneurs, the VAT rate applicable is 3% with limits on VAT deductions.

Who is responsible for VAT in China?

Businesses and individuals providing taxable goods and related processing services or who import into mainland China are liable to VAT. There are two types of VAT registration in China: small entrepreneur; or general business.

Does China have VAT or GST?

China has retained certain unique features of its VAT system, which differentiate it from many major VAT/GST systems used in other parts of the world. China maintains a multiple VAT rate system—3%, 6%, 9% and 13%—though the prospect of further rationalisation of these rates cannot be discounted in the near future.