There are two types of fully digitalized e-invoice: fully digitalized special VAT e-invoice and fully digitalized general VAT e-invoice, which have the same legal effect as the paper invoice and the normal e-invoice currently in use. To remind you of the differences between General and Special VAT invoices:

• General VAT Invoice: This invoice type does not allow for VAT deduction and is typically used for B2C and tax-free transactions. The General VAT Invoice is a simplified invoice type and paperless has been allowed for years for general VAT invoices
• Special VAT Invoice: This invoice types allows for VAT deduction, and is typically used for B2B transactions

A major upgrade in this pilot is the elimination of special tax control equipment (e.g. UKEY), pilot taxpayers will instead use a national unified e-tax service platform to issue, deliver and validate e-Fapiao24/7 for free. Once the invoice data is entered in the system, the platform will issue a unique invoice number, meaning that taxpayers no longer need to apply for invoices via their local tax bureau. In addition, this platform creates a Tax Digital Account for each taxpayer, which automatically collects invoice data, allowing taxpayers to search, print, and download invoices from the platform.
The e-tax service platform aims to serve as a one-stop shop for all invoicing needs, it will be also available in the form of software and mobile app in the near feature. Furthermore, this pilot has abolished the OFD file format requirements, pilot taxpayers can send the fully digitalized e-invoice through their Tax Digital Account, QR code, or by email.

While fully digitalized e-invoice is still in the pilot stage, we expect widespread promotion and implementation soon. It is recommended that enterprises continue to pay close attention to the latest developments and evaluate the potential impact on their business. Of course, Tungsten Network will stay close to China’s e-invoicing pilots, and we will keep you up to speed.

The STA (State Tax Administration) has launched a public e-invoicing platform aiming to provide free e-invoicing support 24/7 (inv-veri.chinatax.gov.cn). Suppliers/Buyers can access this website to:

• perform validation checks on both paper and electronic invoices issued within the last 5 years. Each invoice can only be checked 5 times per day.
• download relevant certificates and software, e.g. OFD reader, e-invoice generator for UKEY users.
• learn more about e-invoicing in china via online resources, e.g. how to identify the validity of paper fapiao.

It’s noticeable that this platform has access restrictions to foreign browsers and may not work on Apple IOS systems.

The STA (State Tax Administration) has launched a public e-invoicing platform aiming to provide free e-invoicing support 24/7 (inv-veri.chinatax.gov.cn). Suppliers/Buyers can access this website to:

• perform validation checks on both paper and electronic invoices issued within the last 5 years. Each invoice can only be checked 5 times per day.
• download relevant certificates and software, e.g. OFD reader, e-invoice generator for UKEY users.
• learn more about e-invoicing in china via online resources, e.g. how to identify the validity of paper fapiao.

It’s noticeable that this platform has access restrictions to foreign browsers and may not work on Apple IOS systems.

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The Special VAT e-invoicing initiative aims to replace the existing Fapiao process, which is fully paper-based, and which requires taxpayers to use government pre-numbered invoices and visit local tax offices to produce such invoices.

Businesses are typically selected and certified for the pilot. Certified companies use the State “Public Service Platform of Electronic VAT Invoice” using their ‘U Key’ login terminal, which is a hardware component provided by local tax offices. On the Public Service Platform taxpayers request approval for the type and number of sales invoices they will issue in a certain period. The Public Platform is also used for the permanent storage of invoices. Invoice corrections (credit notes) can also be issued using the Service Platform (using red-lined special Fapiaos).

The Special VAT e-invoicing initiative aims to replace the existing Fapiao process, which is fully paper-based, and which requires taxpayers to use government pre-numbered invoices and visit local tax offices to produce such invoices.

Businesses are typically selected and certified for the pilot. Certified companies use the State “Public Service Platform of Electronic VAT Invoice” using their ‘U Key’ login terminal, which is a hardware component provided by local tax offices. On the Public Service Platform taxpayers request approval for the type and number of sales invoices they will issue in a certain period. The Public Platform is also used for the permanent storage of invoices. Invoice corrections (credit notes) can also be issued using the Service Platform (using red-lined special Fapiaos).