Update on Fully Digital E-invoicing under the Age of Big Data

Recently, with the increasing promotion and use of fully digitalized electronic invoices (hereinafter referred to as “all-electronic invoices”), the general taxpayers’ concern about all-electronic invoices is also increasing day by day.

 

You may refer to the article on our website at the end of 2021 regarding the pilot of all- electronic invoicing in Shanghai:

https://www.serviceonnewgrounds.com/full-digital-invoicing/

 

• Background

Starting from 1 December 2021, Guangdong Province (excluding Shenzhen), Shanghai Municipality and Inner Mongolia Autonomous Region, one province, one municipality directly under the Central Government and one autonomous region, began to conduct pilot all-electronic invoicing, i.e. the pilot taxpayers in these three provincial administrative regions can issue all-electronic invoices, and of course, taxpayers under the jurisdiction of these three provincial tax authorities can also accept all-electronic invoices issued by pilot taxpayers in their own provinces.

 

Starting from 10 May 2022, Sichuan Province is included in the pilot scope of all-electronic invoices acceptance; starting from 21 June 2022, 5 provinces and cities, including Beijing, Jiangsu Province, Shandong Province (excluding Qingdao), Zhejiang Province (excluding Ningbo) and Shenzhen City, are included in the pilot scope of all-electronic invoices acceptance; starting from 21 June 2022, Guangdong Province (excluding Shenzhen), Shanghai City and Inner Mongolia Autonomous Region accept each other’s all-electronic invoices issued by the pilot taxpayers; 9 provinces and cities, including Hunan Province, Hubei Province, Henan Province, Hebei Province, Anhui Province, Fujian Province, Jiangxi Province, Shaanxi Province and Chongqing Municipality, are included in the pilot scope of all-electronic invoices acceptance starting from 18 July 2022.

 

At this point, the number of provinces that can issue all-electronic invoices nationwide remains at three: Guangdong Province (excluding Shenzhen), Shanghai and Inner Mongolia Autonomous Region.

 

There are 14 provinces (except Guangdong, Shanghai and Mongolia) that can accept all-electronic invoices nationwide: Sichuan Province, Beijing, Jiangsu Province, Shandong Province (excluding Qingdao), Zhejiang Province (excluding Ningbo), Hunan Province, Hubei Province, Henan Province, Hebei Province, Anhui Province, Fujian Province, Jiangxi Province, Shaanxi Province and Chongqing Municipality; in addition, there is one planned city: Shenzhen.

 

• What is an all-electronic invoice?
• Not in paper form
• No media support
• No application required for collection

All-electronic invoices with the same legal effect as paper invoices are a comprehensive digitization of the paper invoice’s ticket information, a change of multiple ticket types into a single electronic invoice, and a record under an enterprise’s digital account for tax purposes.

 

• Difference between paper-based electronic invoices and all-electronic invoices

1. Management style

Paper-based electronic invoice Still under paper invoice management mode	All-electronic invoice Company Setting-up for invoicing
Tax-controlled special equipment required	No tax-controlled special equipment required
Invoice approval, collection and validation required	No need for invoice approval, collection and validation
Maximum invoicing limit approval, additional types and limits on application	Automatic credit given for the total invoiceable amount and dynamically adjusted

 

 

2. Means of delivery

After issuing Paper-based electronic invoice	After issuing All-electronic invoice
Delivery by email or SMS by the invoicing party, manual download and printing by the receiver	Invoice data files are automatically sent to the tax digital accounts of the invoicing and receiver parties
The invoice receiver needs to collect, collate and record	Full volume of invoice data is automatically aggregated, eliminating the need for manual receipt and issuance, posting and other operations

 

3. Invoice Ecology

Paper-based electronic invoice “Invoice control” through special tax-controlled equipment	All-electronic invoice “Background control” through big data information related to invoicing
Invoicing, delivery, ticking and checking platforms are independent of each other	Deep integration of invoicing, delivery, ticking and checking applications
The invoicing platform is relatively homogeneous	Taxpayers can enjoy “one-stop” services and the invoicing platform functions are transformed into an open ecosystem

 

We will continue to follow the progress of the application of all-electronic invoicing in China, especially in Shanghai.

 

If you have further questions, please do not hesitate to contact us.

 

For any questions, please feel free to contact us.