Export tax refundWhat is it?

Simply put, its about getting the tax money back. Imagine this: you run a factory producing a batch of clothing, paid 13% VAT when purchasing the fabric, and later sold this batch abroad. To encourage exports, the government refunds the tax you previously paid proportionally, which is...Export tax refund.

Core logicThe state does not tax exports, making Chinese goods more price competitive in the international market.

What conditions must be met to claim a tax refund?

1. You must be a legitimate taxpayer:

• The company must be a general VAT taxpayer (small-scale taxpayers cannot claim tax refunds);
• Have import and export operation rights (can be obtained by filing for foreign trade).

2. Goods must really go abroad:

• The goods have actually left the country (there is an export record at customs).
• The goods must not be prohibited from export (such as rare earths, endangered animal products).

3. Money must really come back:

• Receive foreign exchange payment (the banks foreign exchange settlement slip is an important proof);
• If it is a credit sale (shipment before payment), the payment must be received before the tax refund declaration.

4. Dont cross policy red lines:

• Not tax fraud (such as fake invoices, false exports);
• Not goods subject to national tax refund restrictions (such as certain resource products).

Tax Refund Process: Follow these four steps closely.

1. Registration and filing (open a shop to obtain tax refund eligibility)

• File for export tax refund registration at the electronic tax bureau (online form filling, completed in 1-2 days);
• Obtain the Export Enterprise Tax Refund Registration Certificate (now mostly electronic in most regions).

2. Customs declaration for export (let customs know the goods are really gone)

• Find a freight forwarder for customs clearance and obtain the export customs declaration form (which includes your cargo value, quantity, HS code);
• The transaction method on the customs declaration form must match the contract (e.g., FOB, CIF).

3. Collect documents (prepare tax refund evidence chain)

• Procurement stage: VAT special invoice (issued by the factory to you).
• Sales stage: Export contract, Proforma Invoice.
• Logistics link: Bill of Lading (B/L), packing list, customs declaration form;
• Foreign exchange collection link: bank foreign exchange receipt (proof of money received).

4. Declare tax refund (submit tax refund application form online)

• Log in to the electronic tax bureaus Export Tax Refund Module and upload the required documents.
• The system automatically compares information (whether the invoice, customs declaration, and foreign exchange are consistent).
• After the tax bureaus approval, the tax refund will be transferred to the companys account (usually within 1-3 months).

Precautions: Dont step into these pitfalls!

1. Documents must be three consistent:

• The product name, quantity, and amount on the invoice, customs declaration form, and contract must be completely consistent.
• Case: A companys customs declaration form wrote stainless steel cup, but the invoice wrote thermos cup, resulting in the tax refund being rejected.

2. Time limits must be strictly adhered to:

• After the goods are exported, the tax refund must be applied for before the VAT declaration period of the following year at the latest, otherwise it will be void.
• The foreign exchange collection period is generally within 1 year after export (can be extended under special circumstances).

3. Dont be careless with foreign exchange management:

• If the customer pays in RMB, foreign exchange verification is also required (some banks can handle it on behalf);
• Third-party payments (e.g., customers paying through a Hong Kong company) require a written explanation.

4. Tax refund rates may change, keep an eye on policies:

• The state adjusts the tax refund rate annually (for example, the tax refund rate for some chemical products dropped from 13% to 9% in 2023);
• Check the tax refund rate: Log in to Electronic Tax Bureau—Export Tax Refund Inquiry or Customs HS Code Library.

5. Dont buy fake invoices for cheap:

• The tax bureau will strictly check whether the invoice flow, goods flow, and capital flow are consistent.
• Buying fake invoices for tax refunds can result in fines or even criminal liability.

Handy Tip: This way, tax refunds are faster and more stable.

• Regular reconciliationCheck customs declarations, invoices, and foreign exchange records monthly to identify issues in advance;
• Find an accounting agencyLet professionals handle professional tasks (agency fee is about 1%-3% of the tax refund amount).

Conclusion

Export tax refunds are a policy red envelope from the state to foreign traders, but claiming it must follow the rules. Remember these three keywords:Document consistency, timing, and compliance operationsOnly then can this money be securely pocketed. Finally, a reminder: policies change quickly, so pay attention to relevant agency announcements and consult a professional accountant when necessary. Dont let the money slip away!

Finally, if you need agency services or other support in export trade, feel free to contact us!