6.2 Invoice Management
6.2.1 Definition of Invoice
Invoice is the proof of payment in a transaction involving the sale of goods, provision of labour service, or other business activities. It is also a document supporting that a payment and receipt has taken place, an official document for financial management and accounting, and an important tool in auditing for taxation purpose.
Invoices are generally in triplicate copies, namely the stub, invoice copy and accounts copy. Value-added tax (VAT) invoices have one more copy, which is the deduction copy.
6.2.2 Purchase and Collection of Invoice
(a) Purchase and collection procedure
An individual or enterprise that has completed tax registration as required by law will be issued a tax registration certificate, after which he or it can apply to the competent tax office for the purchase of invoice by submitting the following: identification document of the applicant, tax registration certificate or other proof, official seal or special seal for invoices. Upon examination and approval by the tax office, an invoice collection book specifying the type and quantity of invoices to be purchased as well as the method of purchase will be issued. The applicant can then purchase the invoices from the competent tax office.
(b) Temporary purchase of invoice in other localities
An individual or enterprise in need of invoices on a temporary basis can apply directly to the local tax office. When an individual or enterprise conducts business activities in places other than the place of original tax office and needs invoices, an application can be made to the local tax office by submitting proof from the original tax office. A guarantor is required in this case or a deposit of no more than Rmb10,000 is payable depending on the face value and quantity of invoices specified in the invoice collection book. This kind of invoices issued by the tax office where the business activities take place have to be used and cancelled within a specified period.
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