E-invoicing in China

China operates one of the most advanced mandatory e-invoicing regimes in the world, built around the e-fapiao system and administered through the State Taxation Administration’s (STA) Golden Tax system (金税工程). Unlike many jurisdictions that permit e-invoicing as an option alongside paper, China is progressively moving to a clearance-based model in which all VAT invoices must be validated by the STA before they carry legal force. The nationwide rollout of the fully digitised e-fapiao took effect on 1 December 2024, covering B2B, B2G, and B2C transactions.

China does not operate a separate e-invoicing framework for public sector transactions distinct from its general VAT invoicing regime. B2G transactions are within scope of the same e-fapiao system that covers commercial invoicing.

• Suppliers to government bodies and public entities in China must issue VAT-compliant e-fapiao through the STA’s national e-invoice platform (the Leqi platform) in the same manner as for B2B transactions.
• Special VAT e-fapiao are used for B2G supplies where VAT input credit is relevant; general VAT e-fapiao are used where no input credit applies.
• China does not operate a public procurement e-invoicing framework aligned with EU Directive 2014/55/EU or a standard equivalent to EN 16931. The Golden Tax system serves as the universal platform for all domestic invoice types, including government procurement.
• Public entities and government bodies cannot refuse a valid e-fapiao; e-fapiao hold full legal equivalence with paper fapiao under the Regulations on the Administration of Invoices of the People’s Republic of China.

China operates a mandatory clearance-based e-invoicing model for B2B transactions. Under this model, no invoice is legally valid until it has been submitted to and cleared by the STA platform.

• B2B VAT invoices must be issued as special VAT e-fapiao — the invoice type that entitles the recipient to claim input VAT credits. Special e-fapiao must be issued electronically through STA-approved software or direct API integration with the Leqi platform.
• Invoice data is transmitted to the STA in XML format in real time at the point of issuance. The STA validates the invoice and returns it with a unique 20-digit invoice number, digital signature, and dynamic QR code before delivery to the buyer.
• The clearance process typically completes in real time or near real time (within seconds). A buyer cannot lawfully refuse a valid e-fapiao.
• Paper fapiao and earlier electronic invoice formats are being progressively phased out. The e-fapiao is the default VAT invoice format for domestic B2B transactions.
• Newly registered businesses have been required to use the digital system from incorporation. For existing businesses, the STA has been rolling out mandatory adoption in staged batches by region and industry since 2023.

B2C transactions are subject to the same e-fapiao framework, using the general VAT e-fapiao format.

• General VAT e-fapiao are issued for sales to consumers where no input VAT credit is claimed by the recipient. They carry the same legal validity as special e-fapiao but do not entitle the buyer to deduct input VAT.
• Businesses must issue a valid fapiao for every taxable sale upon request. A customer cannot be refused a fapiao.
• For lower-value or high-volume retail transactions, simplified invoice or receipt formats may be used in certain permitted circumstances.
• E-fapiao are delivered to consumers electronically — typically via email, SMS link, or platform download — eliminating the need for paper copies.
• Retail and point-of-sale systems must be capable of integrating with the STA’s e-invoice platform or using STA-approved software to generate and clear fapiao at the time of sale.

China operates a continuous transaction control (CTC)/clearance model — one of the most stringent real-time reporting regimes globally.

• All e-fapiao data is transmitted to the STA at the moment of issuance. There is no separate e-reporting process or deferred submission window; compliance is achieved through instant clearance at the point of invoice creation.
• The STA has direct and immediate visibility into all cleared invoice transactions, enabling real-time audit and compliance monitoring.
• The VAT return itself is not prepopulated by the STA at this stage, and taxpayers must continue to file their own figures. However, the STA’s invoice data is expected to be used to prepopulate VAT return fields or drive automated compliance checks as the system matures.
• China does not implement SAF-T or a separate e-reporting regime. The clearance model renders a secondary reporting layer unnecessary — the invoice data is the reporting event.
• E-fapiao are issued in XML as the authoritative legal record, with OFD (Open Fixed-layout Document) as the standard rendering format. PDF copies may be provided for convenience but do not hold independent legal status.
• Invoices and related accounting records must be retained for a minimum of 10 years. For certain accounting voucher categories, a 30-year retention period applies under China’s broader financial record-keeping rules. Records may not be stored outside China without compliance with data export requirements under applicable Chinese data security regulations.