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Golden Tax System and Chinese characters

Invoicing is different in China than in the Western world. With Tabellae, invoicing and VAT in China is not a problem.

Planning to invoice in China?

Does your company or subsidiary operate in China or are you planning to do so? Then you should know that invoicing is significantly different from what you are used to in terms of the western part of the world.

Is your ERP system able to comply with Chinese legislation in a time and cost-effective way?

Make sure you have paid your VAT
When operating in the Chinese market, all invoices must be issued through the Golden Tax System to be valid. The reasons are that the Chinese State Administration of Taxation (STA) can ensure that the correct amount of Value Added Tax (VAT) is paid.

Before 2019, invoicing in China was difficult

Before 2019, China’s STA and regional tax authorities had their separate versions of the Golden Tax System (GTS), which did not share information.

As a result, state and local governments were only concerned with the taxes they oversaw, and the situation could cause problems for businesses.

Should the Chinese tax authorities find that you have not complied with tax laws and paid the correct amount of VAT, it could potentially cost your business a significant amount of money in fines.

‘Modern China’ has simplified invoicing

As more and more international companies established themselves in China, it became a requirement that all invoicing could be handled seamlessly.

The lack of information sharing was addressed in an update to the Golden Tax System in 2019.

The update combines the two different tax systems into one. Tax information between government and tax authorities is more easily shared, enabling businesses to better comply with China’s nationwide tax laws and enable VAT payment.

The Golden Tax System update includes the following benefits:

Resources spent by your company on tax issues can be significantly reduced.

STA can now monitor your company’s tax compliance and business status.

Increase transparency of tax information.

Data from different tax returns can now be easily collected and shared.

Information about tax evaders will be published through official media.

China’s STA’s ability to deal with tax evaders will be increased.

How does the Golden Tax System work?

Sales-related information, such as sales amounts, VAT amounts, customer details, and the nature and quantity of products and services, is automatically uploaded to the tax authorities.

When issuing invoices, the system is used for preparing and submitting tax returns, incoming VAT registration, etc.

When you issue an invoice, your company connects its terminal to the invoicing part of GTS. For every invoice transaction your company sends, a corresponding electronic copy is sent to STA. Ultimately, the STA can receive an invoice copy through its terminal from the company terminal and thus control VAT.

Invoicing and VAT in China can be easy

The Lasernet Output Management software component provided by Tabellae enables your company to receive market-leading tools to help your business with VAT invoicing and payment in the Chinese market.

Tabellae’s industry specialist knowledge has several advantages that will benefit you when invoicing in China in your desired ERP system. Lasernet acts as an “engine” that automatically sends the invoice from your ERP system to the Golden Tax system. The software also supports a display of Chinese characters on documents if they are part of the data set we retrieve from D365 or other systems. This makes it easy for you to invoice between China and the countries you operate in.

With Lasernet, you can ensure your VAT invoice is valid and avoid the financial consequences of not complying with Chinese tax laws.

Get an overview of the applications

Want to learn more about the possibilities of using a Document Management solution from Tabellae and how we can help your business?

Send me an email and I’ll contact you to set up a time for a counseling session that suits you.

Lennart Garbarsch, Partner