China E-Invoicing

China’s VAT digitization journey began nearly two decades ago with the rollout of a tax regime called the Golden Tax System. This created a national taxation platform for reporting and invoicing, as well as legislation regulating the use and legal effect of e-signatures.

With the increase of mobile payment adoption, the push towards customer-facing e-invoicing grows. The Chinese government has taken initiatives to further reform reporting and invoicing with a proposed nationwide e-invoicing service platform to provide an e-invoice issuance service to all taxpayers free of charge.

China e-invoicing requirements

E-invoicing has been gradually introduced in China, starting with the B2C segment – in some cases by mandating large amounts of taxpayers in the public service sector to issue VAT e-invoices to their customers.

Whilst e-invoicing is not mandatory, it has been widely accepted in B2C instances for several years. It is mandatory in certain core service-based industries, including telecommunications and public transportation. Invoices are issued via the national system, and the hardware and software are certified by the state authority.

A pilot program was launched in September 2020, which enables specific taxpayers operating within China to voluntarily issue VAT special e-invoices. Special invoices are used to claim input VAT and are generally used in B2B transactions.

Format of electronic invoices in China

Electronic invoices take different forms in China. The document is automatically sent to the State Taxation Administration in XML format, and it is returned to the invoice issuer in either PDF or OFD format.

All e-invoices must include a QR code and an electronic signature, buyer and seller information, an invoice number and issuance date, details for the goods or services provided and financial information (unit price, tax rate & amount, etc).

FAQ

Yes, China began its pilot program for electronic invoicing in September 2020 – specifically for B2B transactions in Ningbo, Shijiazhuang and Hangzhou.

Electronic invoicing is not currently mandatory in China, though it is widely accepted by organisations nationwide.

China’s electronic invoicing dictates that these documents must be securely archived for 30 years from their issuance.

The ZRE stands for Zentrale Rechnungseingangsplattform des Bundes, which translates as Central Invoice Submission Portal. ZRE is a web portal that allows suppliers and service providers to send electronic invoices to federal entities.

ZUGFeRD is a hybrid e-invoicing format that includes human-readable (PDF/A-3) and machine-interpretable invoice data. It’s based on XML, allowing invoices to be sent as attachments or embedded within an email.

ZUGFeRD meets the requirements of the European standard (EN 16931).

XRechnung is a standard for electronic invoicing that the German government accepted in late 2020. It was devised as a standard for converting invoice information into an XML data file, serving as an e-invoice.

XRechnung also meets the requirements of the European standard (EN 16931).

B2G e-invoicing has been mandated at a national level since mid-2019, meaning that all Member State government agencies must be able to receive and manage electronic invoices.

Elsewhere, here’s the timeline for B2B e-invoicing in the country:

  • From January 2025, all German taxpayers must be able to receive electronic invoices from their suppliers.
  • From January 2027, all German taxpayers with an annual turnover of over EUR 800,000 must issue electronic invoices.
  • From January 2028, all German taxpayers must issue and receive electronic invoices.

When transacting with federal contracting authorities, you should send an electronic invoice through the relevant state’s individual transmission platform.

Timeline of e-invoicing adoption in China

Learn more about China’s journey to adopting electronic invoicing with the key dates below.

  • September 2020: China’s e-invoicing pilot program began allowing e-invoice issuance for B2B purposes. It initially only included Ningbo, Shijiazhuang and Hangzhou
  • December 2020: Pilot expanded to include Tianjin, Hebei, Shanghai, Jiangsu, Zhejiang, Anhui, Guangdong, Chongqing, Sichuan and Shenzhen
  • January 2021: Pilot further expanded to include Beijing, Shanxi, Inner Mongolia, Liaoning, Jilin, Heilongjiang, Fujian, Jiangxi, Shandong, Henan, Hunan, Guangxi, Hainan Guizhou, Yunnan, Tibet, Shaanxi, Gansu, Qinghai, Ningxia, Xinjiang, Dalian, Xiamen and Qingdao
  • December 2021: A new pilot program, only for selected taxpayers, started in Shanghai, Inner Mongolia and Guangdong, introducing the so-called “fully digitised e-invoice”, a new type of e-invoice that simplifies the e-invoice issuance for both B2B and B2C purposes
  • December 2024: The State Taxation Administration officially recognises e-invoices with the same legal weight as paper invoices

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