In order to implement the requirements of the Opinions on Further Deepening the Reform of Tax Collection and Management issued by the Central Office and the State Council, and further promote the electronic reform of invoices, State Taxation Administration of The People’s Republic of China issued the Announcement of State Taxation Administration of The People’s Republic of China on Promoting the Application of Comprehensive Digital Electronic Invoices (State Taxation Administration of The People’s Republic of China Announcement No.11 in 2024), clarifying that on the basis of the positive results achieved in the previous pilot, comprehensive digital electronic invoices (hereinafter referred to as "digital electronic invoices") will be officially promoted and applied nationwide from December 1, 2024. Today I will take you to understand:How do taxpayers issue electronic invoices in red words?
Taxpayers need to issue red-letter electronic invoices or red-letter paper invoices through the electronic invoice service platform in case of errors in invoicing, sales returns, service suspension, sales discounts, etc., according to the following provisions:
(1) If the drawee fails to confirm the use and entry, the electronic invoice service platform will issue a red-ink electronic invoice in full or in part or a red-ink paper invoice in full or in part based on the red-ink invoice information confirmation form (hereinafter referred to as the confirmation form) after the drawer fills in the red-ink invoice information confirmation form on the electronic invoice service platform. Among them, the Confirmation Sheet should be consistent with the corresponding blue-ink invoice information.
Example: On June 10th, 2024, Company F (the taxpayer who has used the digital invoice) found that there was an error in the contents of a special paper invoice issued to Company G (the taxpayer who has used the digital invoice) on May 31st, 2024, and it was found through the electronic invoice service platform that Company G had not confirmed the use of the obtained invoice and recorded the invoice. After F company contacts G company to retrieve the related invoice, it fills out and uploads the Confirmation Sheet through the electronic invoice service platform. Without confirmation from G company, F company can choose to issue a red-letter electronic invoice or a red-letter paper invoice in full or in part. If the electronic invoice in red characters is selected, the electronic invoice service platform will issue it in full or in part according to the Confirmation Sheet; If the red-ink paper invoice is selected, it will be issued in whole or in part by Company F..
Example: In April, 2024, Company H (the taxpayer who has used digital invoices) provided processing services for Company I (the taxpayer who has not used digital invoices). On April 18th, 2024, Company H has issued a digital invoice with the words "special VAT invoice" for Company I.. On April 20th, the labor service was terminated due to objective reasons. Before that, Company I didn’t confirm the use of the invoice and enter the invoice into the account. Company H filled out the Confirmation Sheet through the electronic invoice service platform without confirmation from Company I, and Company H issued an electronic invoice in full or in part based on the verified information of the Confirmation Sheet.
(2) If the drawee has confirmed the use or entered the account (the check and confirmation for export tax refund is still carried out according to the current regulations), the drawee is a taxpayer who has used digital invoices, and the drawer or the drawee can fill out and submit the Confirmation Sheet on the electronic invoice service platform. After the other party confirms it on the electronic invoice service platform, the drawer will issue a red-letter electronic invoice or a red-letter paper invoice in whole or in part; The drawee is a taxpayer who has not used digital invoices. The drawer fills in and submits the Confirmation Sheet on the electronic invoice service platform or the payee’s comprehensive service platform for value-added tax invoices. After confirmation by the other party, the electronic invoice in red characters or paper invoice in red characters will be issued in full or in part. Among them, the Confirmation Sheet should be consistent with the corresponding blue-ink invoice information.
If the drawee has used the invoice for VAT declaration and deduction, it shall temporarily transfer it from the current input tax amount according to the VAT amount listed in the Confirmation Sheet, and after obtaining the red-ink invoice issued by the drawer, it will be used together with the Confirmation Sheet as the accounting voucher.
Example: In October 2023, Company J (the taxpayer who has used the digital invoice) sold a batch of clothes to Company K (the taxpayer who has used the digital invoice), and a digital invoice with the words "special VAT invoice" has been issued, and Company K has confirmed the use of the obtained invoice. In November 2023, the sales of this batch of clothing were returned.
Case 1: The financial personnel of Company K fill out the Confirmation Sheet through the electronic invoice service platform, select the reason and the corresponding blue-ink invoice information, and enter the amount and tax amount. After the financial personnel of Company J complete the confirmation through the electronic invoice service platform, the financial personnel of Company J will issue a red-letter electronic invoice accordingly.
Case 2: The financial personnel of Company J fill out the Confirmation Sheet through the electronic invoice service platform, select the reason and the corresponding blue-ink invoice information, and enter the amount and tax amount. After the financial personnel of K company complete the confirmation through the electronic invoice service platform, the financial personnel of J company issue the electronic invoice in red words accordingly.
Example: In November, 2023, Company L (the taxpayer who has used the digital electricity invoice) sold a batch of toys to Company M (the taxpayer who has not used the digital electricity invoice), and a digital electricity invoice with the words "special VAT invoice" has been issued, and Company M has confirmed its use. In December, 2023, the toys were sold back.
Case 1: The financial personnel of Company L fill out the Confirmation Sheet through the electronic invoice service platform, select the reason and the corresponding blue-ink invoice information, and enter the amount and tax amount. After the financial personnel of M Company complete the confirmation through the comprehensive service platform of VAT invoice, the financial personnel of L Company will issue a red-letter electronic invoice accordingly.
Case 2: The financial personnel of Company M initiate the Confirmation Sheet through the VAT invoice comprehensive service platform, select the reason and the corresponding blue-ink invoice information, and enter the amount and tax amount. After the financial personnel of Company L complete the confirmation through the electronic invoice service platform, the financial personnel of Company L will issue a red-letter electronic invoice accordingly.