All enterprises and individuals engaged in the sales of goods, provision of services, provision of processing, repairs and replacement services, and the import of goods within China, are liable for VAT. There are a few exemptions as shown below:

• Self-produced agricultural products sold by agricultural producers
• Contraceptive medicines and devices
• Antique books
• Instruments and equipment imported directly for use in scientific research, experiments and education
• Materials and equipment imported from foreign governments and international organisations
• Articles imported directly by organisations for special use by the disabled

Acclime, with unparalleled knowledge and experience of China tax and VAT, can help firms and individuals with their VAT and sales tax filing.

China VAT rates

In China, every individual and business that engages in the business of importation, provision of services and sale of goods is obliged to pay valued added tax (VAT) on the revenue from their operating activities. Generally, depending on their respective industry revenue, the tax rate is 13% on goods and 6% on services.

However, the government has provided some exceptions in order to decrease the impact of VAT taxation on specific industries:

• Small-scale taxpayers – 3%
• Reduced rate for the transportation industry – 9%
• Reduced rate for the agricultural and ecological industry – 9%

The applicable service VAT rates are as follows:

• Intangible movable property leasing services – 13%
• Transportation services – 9%
• Postal services – 9%
• Basic telecommunications services – 9%
• Value-added telecommunications services – 6%
• Research, development & technical services – 6%
• Information technology services – 6%
• Cultural & creative services – 6%
• Logistics auxiliary services – 6%
• Certification & consulting services – 6%
• Broadcasting, cinematic & television services – 6%

Once a business is legally established in China, a company has to prepare VAT Tax filing in order to pay the proper amount of taxation according to their revenue from business activities and provide them to the in-charge tax authorities. Acclime can assist you throughout this process and produce your Accounting Statements accordingly to file VAT Tax returns according to the local district and the national Chinese laws.