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Briefing document & Podcast: E-Invoicing and E-Reporting in China

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SUMMARY

Executive Summary: China is rapidly transitioning to a fully digital, real-time tax invoice system, known as the e-fapiao system. While the official nationwide implementation of fully digitalized electronic invoices took effect on December 1, 2024, the system is currently “widespread but not yet universally mandatory.” The direction, however, is towards full mandatory e-invoicing for all VAT taxpayers by late 2025. The system operates on a “clearance model,” where invoice data is transmitted to tax authorities instantly upon issuance. It primarily covers domestic B2B and B2C transactions, with strict requirements for data format, electronic signatures, and a lengthy 30-year archiving period. Although pre-filled VAT returns are not yet available, the e-invoicing data is laying the groundwork for future tax automation.

1. E-Invoicing Rollout Timeline & Current Status China has pursued a phased, gradual implementation of electronic invoicing over the past decade.

  • Pilot Phases (2015-2021): The rollout began with general VAT e-fapiao (mostly B2C, non-deductible) nationwide in 2015, followed by pilots for special VAT e-fapiao (B2B, VAT-deductible) starting in 2020. These pilots expanded, covering all provinces by December 2023. During this period, “new taxpayers were often required to use e-fapiao, while existing companies could join voluntarily.”
  • Nationwide Implementation (Dec 1, 2024): The State Taxation Administration (STA) officially announced the “nationwide implementation of fully digitalized electronic invoices” effective December 1, 2024. From this date, “fully digital e-fapiao are available countrywide and hold the same legal validity as traditional paper invoices.” This transition includes the launch of a “unified national e-invoicing platform (the Leqi platform).”
  • Transition Period (2024-2025): There is “no general ‘grace period'” for compliance post-Dec 1, 2024, as the rollout “did not immediately impose a strict legal mandate on all businesses.” Instead, “paper invoices and electronic invoices coexist during a transition period.” While e-invoicing is widespread, it is “not yet universally mandatory” as of late 2024. The “expectation is that e-invoicing will become fully mandatory for all VAT taxpayers by late 2025.”

2. Scope of Transactions China’s e-invoicing mandate primarily focuses on domestic transactions.

  • Domestic Sales (B2B and B2C): Both business-to-business and business-to-consumer transactions within China are within scope. The system provides “two types of VAT e-invoices – Special VAT e-fapiao for B2B sales (allows VAT input credit) and General VAT e-fapiao for B2C or other sales (no input VAT credit).”
  • Import Transactions: Imports into China “are not subject to e-invoice issuance.” Foreign suppliers do not issue Chinese fapiao; import VAT is handled via customs documentation.
  • Export Transactions: Exports from China “do not require a standard VAT e-fapiao to the foreign buyer.” Chinese exporters follow separate VAT processes and may issue zero-VAT or special export invoices, but these are distinct from the domestic e-invoice clearance system.
  • Key takeaway: “China’s e-invoicing program is focused on domestic VAT-taxable transactions; cross-border sales and purchases (exports and imports) are outside the domestic e-fapiao clearance regime.”

3. Taxable Persons in Scope The e-invoicing mandate applies to taxable persons registered in China for VAT purposes.

  • Established Businesses in China: All VAT-registered companies “established in China” can use the platform. “Newly registered taxpayers” have been immediately brought into the system, and many existing businesses have adopted it voluntarily. As of Dec 2024, “any VAT-registered business in China may issue electronic invoices, and no customer can refuse an e-fapiao.” The system covers “both general VAT taxpayers and small-scale taxpayers.”
  • Non-Established Entities: Foreign or non-established companies (without a legal tax presence in China) “are not directly in scope.” Only entities registered with Chinese tax authorities can issue official VAT invoices. The “compliance burden falls on established Chinese taxpayers.”

4. E-Invoice Data Requirements and Format China’s e-invoices adhere to a standardized format and content defined by the STA.

  • Format: Invoices are generated in XML format for submission to the tax authority. After clearance, the official invoice is made available in a “human-readable PDF or OFD (Open Fixed-layout Document) format,” which is an approved national format.
  • Content: Mandatory fields include a “unique invoice code and 20-digit number,” date, seller/buyer tax IDs, goods/services description, “applicable tax rate and VAT amount,” total amount, and other details. Fully digitalized e-fapiao also incorporate a “dynamic QR code” and “digital signature/certification” from the tax platform. New digital invoices contain “17 data items.”
  • Electronic Signature: Every e-fapiao “carries an electronic signature or seal authorized by the tax authorities,” embedded during the clearance process, which is “mandatory for authenticity.”
  • Method of Issuance: Taxpayers can create e-invoices via the STA’s “national e-invoice service platform web portal” or by integrating their systems via APIs. This replaces the old hardware-based system. Once approved, the seller delivers the e-fapiao to the buyer electronically (e.g., via email, platform link), and “paper copies are no longer needed.”

5. E-Reporting Mechanism and Transmission Timeline China’s e-invoicing system operates on a real-time clearance model.

  • Clearance Model: All e-invoices “must be cleared by the STA before they become valid.” As soon as an invoice is created, its XML data is transmitted to the STA’s platform for validation, which “typically happens in real-time or near real-time (within seconds).”
  • No Separate “E-Reporting” Delay: Due to this clearance approach, there is “no separate e-reporting process with later deadlines.” The “invoice data is reported to the government at issuance,” meaning sellers “cannot issue a legal invoice without that immediate submission and approval.”
  • Transmission and Access: Data is transmitted through the “national e-invoicing platform or Golden Tax System network.” After approval, the finalized e-invoice (with authorization elements) is returned to the issuer, who then delivers it to the buyer. Both buyers and sellers have real-time access to their “tax digital account” on the platform, recording all issued/received e-fapiao.

6. Penalties for Non-Compliance China maintains strict regulations on invoice issuance.

  • Mandatory Issuance: Businesses are “legally required to issue a valid fapiao for every taxable sale.” Failure to issue, issuing incorrect/fake invoices, or refusing to provide an invoice are violations. Non-compliance can lead to “hefty fines” and, for serious fraud, “criminal penalties.”
  • E-Invoicing Specifics: The new digital system allows the “tax bureau to more easily detect non-compliance in real-time.” While “no explicit new penalty regime yet” specifically for not e-invoicing exists (as it’s mostly voluntary), existing invoice laws would apply. Once fully mandatory, enforcement is expected to include “fines for failure to issue e-fapiao via the system” or for late/missing submissions.
  • Summary: Penalties range from minor fines to substantial amounts, including cancellation of tax credits, blacklisting, and in extreme cases, criminal charges. The shift to e-invoicing is intended to “increase compliance.”

7. Archiving Requirements China mandates unusually long retention periods for tax records.

  • Retention Period: E-invoices and related accounting records “must be kept for 30 years” for tax purposes. This stems from Chinese accounting law, which requires original financial documents to be preserved for this duration (extended in 2016 from 15 years).
  • Format: Electronic archiving is permitted “in lieu of paper,” provided the data’s authenticity, integrity, and readability are ensured for the entire retention period. Secure systems with backups are required.
  • Inspection and Retrieval: Archived invoices “must be readily available to tax authorities upon request” throughout the 30-year period. Taxpayers are responsible for maintaining their own archives, even though the STA platform holds the data.
  • Archiving Abroad: Generally, accounting records should be stored in-country. Cloud solutions may be permissible if “the data is accessible in China on demand” and meets security conditions.

8. Pre-filled VAT Returns As of early 2025, China does not provide pre-filled VAT returns.

  • Current Practice: Taxpayers must still manually compile and file periodic VAT returns (usually monthly), even though the tax authority has real-time invoice data. “There is no system of the tax authority sending a pre-completed return.”
  • Future Outlook: The rich data from e-fapiao “is expected to enable more automated tax reporting.” Authorities have indicated that “digital invoice data will be used to pre-populate tax return fields or drive real-time compliance checks.”
  • Current Status: Despite this potential, “no formal pre-populated VAT return service is in place as of 2025.” Taxpayers must continue to file their own figures, utilizing e-invoice data from the STA system for accuracy.

Conclusion: China’s e-invoicing initiative represents a significant step towards a “fully digital, real-time tax invoice system.” All VAT taxpayers in China now have the capability to issue legal electronic invoices through the centralized platform, with domestic B2B and B2C transactions being the primary focus. The “clearance model” ensures real-time reporting to the tax authorities, signifying a heightened level of digital oversight. While a universal mandatory requirement with associated penalties is not yet fully enforced, it is anticipated by late 2025. Businesses operating in China must prioritize adopting e-fapiao, upgrading IT systems, and training staff to ensure seamless compliance and mitigate risks under this evolving and increasingly strict digital tax environment.

INDEPTH ANALYIS

E-Invoicing Rollout Timeline (China): China has been gradually implementing electronic invoicing (e-fapiao) over the past decade, moving from pilots to a nationwide rollout. Key milestones include:
  • 2015–2021 (Pilot Phases): China introduced general VAT e-fapiao nationwide in 2015 (for non-deductible invoices, mostly B2C) and began piloting special VAT e-fapiao (for B2B, VAT-deductible invoices) in select regions by 2020. The special e-fapiao pilot expanded through 2021–2023, eventually covering all provinces by Dec 2023. During this pilot, new taxpayers were often required to use e-fapiao, while existing companies could join voluntarily. Certain industries (e.g. telecom, airlines, utilities) were early adopters and even mandated to issue electronic invoices to customers. [basware.com], [sovos.com] [china-briefing.com], [china-briefing.com] [voxelgroup.net] [sovos.com]
  • Nationwide Rollout – Dec 1, 2024: On Nov 24, 2024, the State Taxation Administration (STA) announced the official nationwide implementation of fully digitalized electronic invoices, effective December 1, 2024. From this date, fully digital e-fapiao are available countrywide and hold the same legal validity as traditional paper invoices under China’s invoice regulations. This marked a transition to a unified national e-invoicing platform (the Leqi platform) to serve all taxpayers with free e-invoice issuance and management services. By 2025, China aims to have most invoices issued electronically, effectively moving to a digital invoice environment. (Notably, as of late 2024 the use of e-invoicing is widespread but not yet universally mandatory; see “Scope of Mandate” below.) [china-briefing.com] [edicomgroup.com] [ey.com]
  • Grace Period / Transition: There is no general “grace period” for compliance after Dec 1, 2024, because the nationwide rollout did not immediately impose a strict legal mandate on all businesses. Instead, paper invoices and electronic invoices coexist during a transition period. For example, in specific sectors a dual system is permitted temporarily: Chinese authorities allowed both paper and e-invoices for railway and air passenger transport to run in parallel until Sept 30, 2025 to facilitate a smooth transition. In practice, this means businesses can continue using existing paper fapiao in early 2025 if needed, while ramping up e-invoice usage. The expectation is that e-invoicing will become fully mandatory for all VAT taxpayers by late 2025 after this transition, but as of the current date no blanket mandate with penalties has been enforced yet. [ey.com] [china-briefing.com], [voxelgroup.net] [voxelgroup.net]
Scope of Transactions (Domestic vs. Cross-Border): China’s e-invoicing mandate primarily covers domestic transactions:
  • B2B and B2C Domestic Sales: Both business-to-business and business-to-consumer transactions within China are within scope of the e-fapiao system. The government’s e-invoicing framework provides two types of VAT e-invoices – Special VAT e-fapiao for B2B sales (allows VAT input credit) and General VAT e-fapiao for B2C or other sales (no input VAT credit). Initially, e-fapiao usage was voluntary for most companies, but newly established businesses have been required to use the digital system from the start. By 2024, all regions allow designated taxpayers to issue e-fapiao for any domestic sale, effectively covering all sectors. (Some industries like finance, telecom, and transportation were specifically guided or required to adopt e-invoices early.) [ey.com] [basware.com] [china-briefing.com], [china-briefing.com] [sovos.com]
  • Import Transactions: Imports into China are not subject to e-invoice issuance. When a Chinese company imports goods or services, the foreign supplier does not issue a Chinese fapiao; instead, import VAT is handled via customs documentation (import VAT payment certificates). Thus, import transactions fall outside the scope of China’s e-fapiao mandate (no domestic VAT invoice is generated for an import).
  • Export Transactions: Exports from China similarly do not require a standard VAT e-fapiao to the foreign buyer. Chinese exporters handle VAT through separate processes (e.g. zero-rated VAT and export rebate filings). They may issue zero-VAT invoices or special export invoices for record-keeping, but these are part of export compliance, not the domestic e-invoice clearance system. In summary, China’s e-invoicing program is focused on domestic VAT-taxable transactions; cross-border sales and purchases (exports and imports) are outside the domestic e-fapiao clearance regime and follow different tax documentation requirements.
Taxable Persons in Scope (Established vs. Non-Established): The e-invoicing mandate applies to taxable persons registered in China for VAT purposes:
  • Established Businesses in China: All companies established in China that are VAT taxpayers can use the e-invoicing platform. In fact, tax authorities have been rolling out e-fapiao by taxpayer segments: as noted, newly registered taxpayers in recent years have been immediately brought into the e-invoice system, and many existing businesses have been invited into the pilot or voluntarily adopted e-invoicing. As of Dec 2024, any VAT-registered business in China may issue electronic invoices, and no customer can refuse an e-fapiao on grounds of format (since e-fapiao have full legal validity). The system covers both general VAT taxpayers and small-scale taxpayers (small businesses) for their invoicing needs – with small taxpayers typically using general e-fapiao, and general taxpayers using special e-fapiao for B2B sales. [voxelgroup.net] [basware.com]
  • Non-Established Entities: Foreign or non-established companies (i.e. businesses without a legal tax presence in China) are not directly in scope of China’s e-invoicing mandate. Only entities that are registered with the Chinese tax authorities can issue official VAT invoices (fapiao). Foreign companies selling into China generally need a local registered entity or must sell via importers who handle invoicing. Thus, non-established persons cannot issue Chinese e-fapiao and are not subject to these requirements. (If a non-resident business is required to register for VAT in China via a local tax representative, then that local registration would issue e-fapiao as needed.) In summary, the compliance burden falls on established Chinese taxpayers – e-invoicing is effectively a domestic obligation.
E-Invoice Data Requirements and Format: China’s e-invoices have a standardized format and content defined by the STA. Key points:
  • Format: E-invoices follow a structured format. Invoices are generated in XML format for submission to the tax authority. After clearance (validation by the STA), the official invoice is made available in a human-readable PDF or OFD (Chinese XML-based PDF alternative) format. OFD (Open Fixed-layout Document) is an approved national format for electronic documents in China, often used for official e-fapiao files. In practice, businesses submit invoice data as XML via the platform or API, and receive back a digitally signed invoice file (PDF/OFD) that can be sent to the customer. [sovos.com], [voxelgroup.net]
  • Content of Invoice: The electronic VAT invoice must contain all the mandatory fields required by Chinese law. This includes: unique invoice code and 20-digit number, date of issue, seller and buyer tax identification information, descriptions of goods or services (incl. quantity, unit, unit price, total amount), applicable tax rate and VAT amount, the total amount with tax, and other details. Fully digitalized e-fapiao also incorporate a dynamic QR code on each invoice and a digital signature/certification from the tax platform to ensure authenticity. In total, the new fully digital invoice format includes 17 data items (covering all the key invoice elements and tax details). [edicomgroup.com], [voxelgroup.net] [edicomgroup.com], [sovos.com]
  • Electronic Signature: Every e-fapiao issued carries an electronic signature or seal authorized by the tax authorities, embedded during the clearance process. This digital signature (or a special anti-forgery code/QR code) is mandatory for authenticity and is included when the STA returns the cleared invoice. It allows recipients and tax officials to verify that the invoice is legitimate and unaltered. [sovos.com], [vatupdate.com]
  • Method of Issuance: Taxpayers can create e-invoices either via the STA’s national e-invoice service platform web portal or by integrating their ERP/accounting systems with the platform via APIs for automated submission. The unified platform (often referred to as the Golden Tax System interface or the new Leqi platform) replaces the old method of using special hardware (tax control USB disks) to print paper fapiao. Now, invoice data is transmitted online directly to the tax authority. Once approved, the seller can deliver the e-fapiao to the buyer electronically (via email, platform link, etc.) – paper copies are no longer needed. Notably, no special format or medium is required for how the buyer receives/stores it – for fully digital invoices, the law does not insist on a particular file format for storage, as long as the content is preserved. [edicomgroup.com] [china-briefing.com], [china-briefing.com] [china-briefing.com]
E-Reporting Mechanism and Transmission Timeline: China’s e-invoicing system functions on a real-time clearance model, meaning the “reporting” of invoice data to tax authorities occurs immediately at the time of invoice issuance:
  • Clearance Model: All e-invoices must be cleared by the STA before they become valid. In practice, as soon as an invoice is created, the data (XML) is transmitted to the STA’s platform for validation. The tax authority system performs instant checks and assigns a unique invoice code, validation hash, and QR code to the invoice. This process typically happens in real-time or near real-time (within seconds). Once cleared, the invoice is considered issued and a compliant tax document. [sovos.com], [openenvoy.com] [sovos.com], [voxelgroup.net]
  • No Separate “E-Reporting” Delay: Because of this clearance approach, there is no separate e-reporting process with later deadlines (such as submitting invoice listings days after issuance). The invoice data is reported to the government at issuance. The seller cannot issue a legal invoice without that immediate submission and approval. Therefore, requirements like “transmit data within X days of invoice” do not apply in China’s system – compliance is achieved by instant clearance. (For any transactions not yet on the e-invoice platform – e.g. if a taxpayer still uses some paper invoices during the transition – those are reported via the traditional Golden Tax System, which typically involves uploading data to the tax authority by the end of the VAT filing period for that month. But for e-fapiao users, the reporting is automatic and real-time.)
  • Transmission to Tax Authority: The data is transmitted through the national e-invoicing platform or Golden Tax System network. Taxpayers either log into the STA’s portal to issue invoices or use software that calls the STA API. In both cases, the invoice information goes straight to the central system. The government’s platform then returns the finalized e-invoice document (with all authorization elements) to the issuer, who delivers it to the buyer. Buyers and sellers each have access to a tax digital account on the platform where all their issued/received e-fapiao are recorded in real time. This means the tax authority already has all invoice data stored, and taxpayers can also download records anytime. [sovos.com], [voxelgroup.net] [china-briefing.com]
  • Data to be Reported: The e-invoice clearance submits all invoice content (as described above) to the STA. There is no additional periodic transactional report required for those invoices – the e-fapiao itself is the reported data. (However, businesses must still file periodic VAT returns – see “Pre-filled VAT Returns” below – but the invoice details are by then already in the tax system for cross-reference.)
Penalties for Non-Compliance: China maintains strict regulations on invoice issuance and reporting (under the Administrative Measures for Invoices and tax law). Key compliance points and penalties include:
  • Mandatory Invoice Issuance: Businesses in China are legally required to issue a valid fapiao for every taxable sale. Failing to issue an invoice, issuing an incorrect or fake invoice, or refusing to provide an invoice to a customer are violations of the law. Under the Regulations on the Administration of Invoices, non-compliance can lead to hefty fines; for serious fraudulent invoicing or tax evasion, criminal penalties (including potential imprisonment) can apply. The authorities treat invoicing compliance very seriously as part of anti-tax-evasion efforts. [chinalegal…xperts.com] [chinalegal…xperts.com], [chinalegal…xperts.com]
  • E-Invoicing Specific Compliance: Although full e-invoicing is not yet mandatory for all, companies participating in the e-fapiao system must comply with the rules (e.g. use the platform for authorized invoice numbers, do not issue paper fapiao in duplicate for transactions already invoiced electronically, etc.). With the new digital system, the tax bureau can more easily detect non-compliance in real-time (for example, discrepancies or attempts to bypass the system), so the **risk of being caught is higher】. Companies are expected to adhere to the invoicing process – issuing through the STA platform – for it to count as a valid tax invoice. If a taxpayer were mandated or registered to use e-fapiao and failed to do so, the tax authorities could deem the invoices invalid and impose penalties (much as they would for not using official invoices). [china-briefing.com]
  • No Explicit New Penalty Regime Yet: As of the latest regulations, China has not introduced separate fines specifically for “not e-invoicing” since the usage is mostly voluntary so far. (By contrast, some countries fine businesses for not using e-invoices by the deadline. In China’s case, until e-invoicing is formally compulsory, the existing invoice laws apply.) Once e-invoicing becomes fully mandatory, we can expect enforcement to include fines for failure to issue e-fapiao via the system or for late/missing submissions, analogous to current invoice violations. The groundwork for this is in place: updated rules (SAT Decree No. 33 of 2023) already classify fully digital invoices as official invoices, so not using them when required would violate invoice issuance laws. [china-briefing.com]
  • Summary of Penalty Provisions: In practice, penalties for invoice infractions can range from relatively minor fines (for small reporting mistakes) to very substantial fines (tens of thousands of RMB or more) for serious offenses, along with potential cancellation of tax credits, blacklisting, or business license impacts. Extreme cases of fraudulent invoicing (e.g. forging fapiao or claiming false input VAT credits) are criminal and have led to arrests. Companies are therefore strongly advised to comply with all invoicing requirements – the shift to e-invoicing is intended to increase compliance, not reduce it.
Archiving Requirements (Retention of E-Invoices): China has long retention periods for tax records, and electronic invoices are no exception. Key requirements:
  • Retention Period: E-invoices and related accounting records must be kept for 30 years for tax purposes. This unusually lengthy retention requirement stems from Chinese accounting law: under the Measures on Accounting Records Administration, original financial documents (like vouchers/invoices) must be preserved for 30 years (previously 15, extended in 2016). Therefore, a VAT e-fapiao, being an official accounting voucher, needs to be accessible for decades. (In comparison, the VAT law itself doesn’t specify a shorter period, so the accounting rules govern record-keeping.) [basware.com], [vatupdate.com] [lexology.com]
  • Format of Archiving: Electronic archiving is allowed and encouraged. Companies may store e-fapiao digitally in lieu of paper as long as certain conditions are met (ensuring the data’s authenticity, integrity, and readability for the full retention period). The electronic invoice files (XML/PDF/OFD plus any metadata) should be stored in secure systems with backups, to guard against loss or tampering over 30 years. China’s rules require that the origin and content integrity of invoices be guaranteed during storage. Businesses typically use document management systems or certified archiving solutions to comply. [basware.com], [lexology.com] [basware.com]
  • Inspection and Retrieval: Archived invoices must be readily available to tax authorities upon request throughout the retention period. Even though the STA’s own platform holds the data, taxpayers are responsible for maintaining their own archive. In practice, the company’s “tax digital account” on the STA platform keeps a history of all issued invoices, which can serve as a reference. However, companies should retain their copies (digital or printed) in case of audits. After 30 years, and subject to any extended audits or disputes, invoices can be destroyed (with proper records of destruction). [lexology.com]
  • Archiving Abroad: China generally requires accounting records (including invoices) to be stored in-country. However, e-archiving with cloud solutions may be permissible if the data is accessible in China on demand and meets security conditions. It’s important for multinationals to ensure Chinese e-invoices are included in their global archiving strategies, but also compliant with Chinese rules. [vatupdate.com]
Pre-filled VAT Returns: As of the latest developments, China does not provide pre-filled VAT returns to taxpayers, but e-invoicing is paving the way for more automated compliance in the future:
  • Current Practice: Chinese VAT payers must file periodic VAT returns (usually monthly) by compiling their sales and purchase information, even though the tax authority already has invoice data. There is no system of the tax authority sending a pre-completed return for the taxpayer to confirm. Companies use the Golden Tax System to retrieve data on input invoices (for claiming credits) and ensure their output invoices are reported, but they still manually prepare the VAT return forms (the “VAT declaration form”) and submit them via the tax online portal or bureau. In short, taxpayers are responsible for declaring their VAT figures, and the STA cross-checks those against the e-invoice database for accuracy. [china-briefing.com]
  • Future Outlook – Integrated Reporting: The rich data from e-fapiao is expected to enable more automated tax reporting. The STA’s e-invoicing platform is linked to a forthcoming system of “One integrated form” for tax declarations. In fact, authorities have indicated that the digital invoice data will be used to pre-populate tax return fields or drive real-time compliance checks. We already see that e-fapiao issuance immediately reflects in the tax digital accounts of both seller and buyer, allowing the system to calculate tax payable and input credits behind the scenes. While not officially labeled as “pre-filled returns” yet, this trend suggests that China may move toward more automated VAT filings. Taxpayers might eventually only need to confirm the data that the system has aggregated from their invoices. [china-briefing.com]
  • No Pre-Filled Returns Yet: Despite the above potential, no formal pre-populated VAT return service is in place as of 2025. Each taxpayer must continue to file on time with their own figures. They should, however, utilize the e-invoice data (downloadable from the STA system) to ensure accuracy. In some locales, the tax authority does provide a summary of the invoices on record (for example, output tax and input tax totals from the system) when you log in to declare – but it’s up to the taxpayer to confirm or correct those before submission. So effectively, VAT returns are not automatically filed by the government, but the groundwork is being laid for such possibilities in the future. There are no pre-populated VAT returns or direct offset calculations by the STA at this time. [china-briefing.com]
Additional References and Regulations: China’s e-invoicing reforms are governed by a combination of new announcements and existing laws:
  • The primary legal basis for invoices is the “Regulations of the PRC on the Administration of Invoices” and its implementation measures. These were updated in 2023 to accommodate electronic invoices (SAT Order No. 37, 2023) and continue to stipulate taxpayers’ duties in invoicing. Under these regulations, a fully digital e-fapiao is considered an “invoice” with all same legal effect as a paper fapiao. [china-briefing.com]
  • The nationwide rollout in Dec 2024 was announced via an official STA notice (Nov 24, 2024), which confirmed the expansion of the e-fapiao service platform countrywide. The STA has also issued sector-specific notices (e.g. jointly with other ministries for airlines and railways) to implement e-invoices in those areas with transitional arrangements. [china-briefing.com]
  • Taxpayers looking for guidance can refer to government resources like the STA’s portal for e-invoice services, and the published Technical Specifications for Fully Digitalized E-Invoices (which define the data format and interface standards). Additionally, Big 4 accounting firms and tax service providers have released detailed newsletters and alerts (in 2023 and 2024) summarizing these changes – for instance, China Briefing’s article on the “Fully Digitalized E-Fapiao Program” and EY’s global e-invoicing tracker note on China. These external analyses concur that China’s e-invoicing is in an advanced stage but currently voluntary in practice (expected to become mandatory soon). [china-briefing.com] [ey.com]
Bottom Line: China’s e-invoicing initiative is moving the country to a fully digital, real-time tax invoice system. As of end-2024, all Chinese VAT taxpayers can issue legal electronic invoices through the centralized platform. Domestic B2B and B2C invoices are covered, while cross-border transactions are handled separately. The system operates on a clearance model – invoice data is transmitted to tax authorities instantly at issuance, with no grace period for later reporting. No explicit universal mandate (and thus no new non-compliance penalties) has been enforced yet, but the direction is toward full mandatory e-invoicing by 2025. Taxpayers must comply with detailed data format requirements and preserve invoices for 30 years in compliant archives. While China does not yet offer pre-filled VAT returns, the data from e-invoicing is laying the groundwork for enhanced tax automation. All companies operating in China should prepare now – adopting e-fapiao, upgrading IT systems, training staff – to ensure smooth compliance and to avoid penalties under the stricter digital oversight. [china-briefing.com], [chinalegal…xperts.com]

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