- China’s VAT rules effective January 1, 2026 add detailed input VAT deduction guidance, especially for long-term assets and documentation.
- A RMB 5 million threshold applies to long-term assets: assets at or below this amount can be fully credited, while higher-value assets need annual adjustments if used for non-creditable purposes.
- The E-Tax system includes a long-term asset module for automated invoice matching, credit deduction, and tracking.
- Input VAT on loan services, and related consultancy/processing/advisory fees, remains non-creditable under the implementation rules.
- Taxpayers must have valid deduction vouchers, verified through the State Taxation Administration’s electronic invoicing system, to claim deductions.
Source: globalvatcompliance.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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