China VAT Registrations Explained
Updated 2 months ago
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Registration Scheme
China has one VAT registration scheme: Standard Registration. There are no simplified or special registration options for foreign businesses.
Who Can Register
Only businesses that are physically established in China can register for VAT. Foreign entities without a local presence cannot register as General Taxpayers and must rely on the Chinese buyer's withholding obligation for cross-border transactions.
Filing Frequency
Depending on the taxpayer's circumstances, VAT returns in China may be filed on any of the following schedules:
Every 10 days
Every 15 days
Monthly (most common for General Taxpayers — returns due by the 15th of the following month)
Quarterly (most common for small-scale taxpayers — returns due by the 15th of the month following the quarter)
The filing frequency is assigned by the tax authorities based on the taxpayer's annual turnover and industry.
Taxpayer Classifications
Taxpayer Type | Annual Taxable Turnover | VAT Rate | Notes |
|---|---|---|---|
General Taxpayer | Above RMB 5,000,000 | 6% (SaaS) | Can deduct input VAT |
Small-Scale Taxpayer | Below RMB 5,000,000 | 1% (through Dec 31, 2027), then 3% | Cannot deduct input VAT |
Small-Scale Taxpayer VAT Exemptions
Small-scale taxpayers may qualify for periodic VAT exemptions if their turnover remains below the following thresholds:
Filing Frequency | Sales Threshold | VAT Treatment |
|---|---|---|
Monthly | ≤ RMB 100,000 | VAT-exempt for that month |
Monthly | > RMB 100,000 | VAT due on the full monthly amount |
Quarterly | ≤ RMB 300,000 | VAT-exempt for that quarter |
Quarterly | > RMB 300,000 | VAT due on the full quarterly amount |
Note: Overseas businesses are not eligible for the small-scale taxpayer VAT exemption.
Voluntary Correction (Back Filing)
China does not have a formal voluntary disclosure program (VDA) equivalent. However, businesses that proactively self-correct errors and pay underpaid taxes before they are discovered by the State Taxation Administration (STA) generally face reduced penalties — typically only a late fee of 0.05% per day of delay on the outstanding amount.
The 2026 VAT Law also strengthens leniency for businesses that voluntarily report issues and implement effective compliance corrections.
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