Legal basis: Article 21 of the Provisional Regulations on Value-added Tax in People's Republic of China (PRC), where taxable sales are made, the taxpayer shall issue a special VAT invoice to the buyer who requests the special VAT invoice, and indicate the sales amount and output tax amount respectively on the special VAT invoice. Under any of the following circumstances, a special VAT invoice may not be issued: (1) The buyer of taxable sales is an individual consumer; (2) The tax exemption clause applies to taxable sales.
Announcement of State Taxation Administration of The People's Republic of China on Expanding the Pilot Scope for Small-scale Taxpayers to Issue Special VAT Invoices by themselves Article 1 Expand the Pilot Scope for Small-scale Taxpayers to Issue Special VAT Invoices by themselves. We will expand the pilot scope of issuing special VAT invoices for small-scale taxpayers from accommodation, forensic consulting, construction, industry, information transmission, software and information technology services to leasing and business services, scientific research and technical services, residential services, repair services and other services. Small-scale taxpayers in the above eight industries (hereinafter referred to as "pilot taxpayers") may voluntarily use the VAT invoice management system to issue their own VAT invoices if they need to issue special VAT invoices for VAT taxable activities. Where a pilot taxpayer needs to issue a special VAT invoice for selling the acquired real estate, it shall apply to the tax authorities for issuing it on its behalf in accordance with relevant regulations. The pilot taxpayers shall calculate the value-added tax payable on sales with the special VAT invoice, and report and pay it to the competent tax authorities within the prescribed tax declaration period. When filling in the VAT tax return, the sales of special VAT invoices issued in this period shall be filled in the corresponding columns of "Number of Current Period" in Column 2 and Column 5 of the VAT tax return (applicable to small-scale taxpayers) respectively according to the collection rate of 3% and 5%.