VAT fapiaos, or special tax invoices will have new requirements in the coming weeks. With the implementation of these requirements, it will be important that all organizations, particularly human resources and finance departments educate their employees on how business expenses are handled in China.
If, however you have a fapiao issued before 1 July 2017, make sure these are verified within 180 days upon issuance. Taxpayers must submit their fapiaos to internal finance departments at least 30 days ahead of the expiration date in order to claim them as an expense.
This new measure will require more effort for both taxpayers and service providers. The accuracy and detail now required on the fapiao from China's State Administration of Taxation (SAT) means that the taxpayers will need to audit fapiaos as soon as possible to ensure they are valid and accurate.
China’s State Administration of Taxation (SAT) has released new requirements for collecting VAT fapiao, which are special tax invoices. 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. It also specifies measures fapiao issuers (service providers) need to take to be compliant Service providers will now need to specify the purpose of the product when issuing VAT fapiao, rather than asking the customer for thier input on the nature of the fapiao. Taxpayers, in turn, will need ensure that they match the specific purpose of the VAT fapiao for the expense that they would like to claim.