# China VAT Guide for 2026: Rates, Registration & Compliance

Canonical: https://trykintsugi.com/sales-tax-guides/apac/china
Published: July 27, 2026

China's standard VAT rate is 13%, with reduced 9% and 6% bands by sector. Covers general vs. small-scale taxpayer status, fapiao invoicing, and filing obligations for businesses operating in China.

- **SaaS:** Taxable
- **Digital Goods:** Taxable

## Key Takeaways

China's VAT applies at three general-taxpayer rates — 13% on most goods, 9% on transport and real estate, and 6% on modern and financial services, which includes software and SaaS — with a reduced 3% collection rate for small-scale taxpayers. A business with annual taxable sales above RMB 5 million registers as a general VAT taxpayer; China has no dedicated foreign-vendor digital-services registration regime distinct from ordinary VAT rules. Exports are zero-rated; SaaS and digital services are treated as modern services, taxable at 6% for a general taxpayer (3% for small-scale suppliers).

## Taxability Snapshot

## Sales Tax Rates

China's Value-Added Tax (VAT) applies at three general-taxpayer rates — 13% on most goods, 9% on transport, construction, and real estate, and 6% on modern and financial services, which includes software and SaaS. Small-scale taxpayers use a 3% collection rate. Exports are zero-rated. The State Taxation Administration (STA) administers it, and China's first unified VAT Law took effect 1 January 2026 [1][2].

| Rate | Applies to |
| --- | --- |
| 13% | Most goods and manufacturing |
| 9% | Transport, construction, real estate, utilities |
| 6% | Modern and financial services, including SaaS |
| 3% | Small-scale taxpayers (simplified) |

For more detail, see our [APAC VAT guides](/sales-tax-guides/apac).

#### Registration & nexus threshold

China uses VAT taxpayer classification, not US-style economic nexus. A business with annual taxable sales above RMB 5 million must register as a general VAT taxpayer and charge 13%, 9%, or 6% depending on the supply, crediting input VAT, while those below the line are small-scale taxpayers taxed at a reduced levy rate [3]. China has no foreign-vendor VAT registration regime for digital services. Where an overseas supplier without an establishment in China sells services to a Chinese customer, the Chinese purchaser acts as withholding agent and remits the VAT [3]. Registration steps are in the How to Register section.

#### Filing frequency & deadlines

General taxpayers file monthly, due by the 15th of the following month, with some filing quarterly; small-scale taxpayers generally file quarterly. VAT on cross-border services is remitted by the domestic withholding agent on its own cycle at the time of payment, so a foreign supplier usually files nothing directly [1][2].

#### Exemptions

Exports of goods and qualifying cross-border services are zero-rated, and the VAT Law lists limited non-taxable and exempt items. SaaS and digital services are taxable, treated as modern services at 6% for a general taxpayer (3% for a small-scale supplier) [1][2].

#### Penalties

Overdue VAT carries a surcharge of 0.05% of the unpaid tax per day, about 18% a year. Underpaid or evaded tax can be fined between 0.5 and 5 times the amount owed, and false or missing fapiao (VAT invoices) carry separate, often severe, penalties [1].

#### Sources

- [1] [State Taxation Administration — Transactions subject to the 13% VAT rate](https://fgk.chinatax.gov.cn/eng/c101280/c5250146/content.html)

- [2] [State Taxation Administration — Transactions subject to the 9% VAT rate](https://fgk.chinatax.gov.cn/eng/c101280/c5250145/content.html)

- [3] [State Taxation Administration — China's tax system (VAT structure and administration)](https://fgk.chinatax.gov.cn/eng/c101270/c101271/c5157953/content.html)

- [4] [State Taxation Administration — China adopts the Value-Added Tax Law (effective 1 January 2026)](https://www.chinatax.gov.cn/eng/c101269/c5237364/content.html)

Verified July 2026 against State Taxation Administration guidance.

#### Frequently asked questions

### What is the China VAT rate in 2026?

Three general-taxpayer rates apply — 13% on goods, 9% on transport, construction, and real estate, and 6% on modern and digital services; small-scale taxpayers use 3%.

### Is there a VAT registration threshold in China?

Businesses become general taxpayers above RMB 5 million in annual taxable sales; below that they are small-scale taxpayers taxed at 3%.

### Is SaaS taxable in China?

Yes. SaaS is a taxable modern service, generally at 6% (3% for a small-scale supplier).

### What must a non-resident digital seller do?

China has no non-resident VAT registration; for services consumed in China the Chinese payer or platform withholds and remits the VAT under the consumption-place principle.

### When are Chinese VAT returns due?

General taxpayers file monthly by the 15th of the following month; small-scale taxpayers file quarterly; cross-border VAT is remitted by the domestic withholding agent.

### What is the penalty for late Chinese VAT?

Overdue VAT accrues a surcharge of about 0.05% per day (roughly 18% per year), and evaded tax can be fined between 0.5 and 5 times the amount owed.