Announcement on Improving the End-of-Period Excess Input Value-Added Tax Credit Refund Policies
Announcement of the Ministry of Finance and the State Taxation Administration [2025] No. 7
August 22, 2025
The matters concerning the improvement of the end-of-period excess input value-added tax (VAT) credit refund policies are hereby announced as follows:
1. Starting from the VAT filing period of September 2025, eligible general VAT taxpayers (hereinafter referred to as “taxpayers”) may apply to the competent tax authorities for a refund of their end-of-period excess input tax credit in accordance with the following provisions:
(1) Taxpayers in the “manufacturing industry,” “scientific research and technical services industry,” “software and information technology services industry,” and “ecological protection and environmental governance industry” (hereinafter collectively referred to as the “four industries including manufacturing”) may apply to the competent tax authorities for a refund of their end-of-period excess input tax credit on a monthly basis.
(2) Taxpayers in the real estate development and operation industry whose newly increased end-of-period excess input tax credit for six consecutive months (or two consecutive quarter for taxpayers paying taxes on a quarterly basis, hereinafter the same) prior to applying for the refund is all greater than zero, and the newly increased end-of-period excess input tax credit in the sixth month (or the second quarter for taxpayers paying taxes on a quarterly basis, hereinafter the same) is not less than CNY 500,000, compared with the end-of-period excess input tax credit as of March 31, 2019, may apply to the competent tax authorities for a refund of 60% of the newly increased end-of-period excess input tax credit in the sixth month (or second quarter).
(3) Taxpayers other than those in the four industries including manufacturing and the real estate development and operation industry, whose end-of-period excess input tax credit for six consecutive months prior to applying for the refund is all greater than zero, and the newly increased end-of-period excess input tax credit in the sixth month compared with the end-of-period excess input tax credit as of December 31 of the previous year of the tax payment period before the application is not less than CNY 500,000, may apply to the competent tax authorities for a proportional refund of the newly increased excess input tax credit. For the portion of the newly increased excess input tax credit not exceeding CNY 100 million (inclusive), the refund ratio shall be 60%; for the portion exceeding CNY 100 million, the refund ratio shall be 30%.
Taxpayers in the real estate development and operation industry who do not meet the requirements under Item (2) of this Article may apply for a refund of their end-of-period excess input tax credit in accordance with the provisions of Item (3) of this Article.
2. A taxpayersapplying the policies under this Announcement must meet the following criteria simultaneously:
(1) The taxpayer's tax/fee payment credit rating is Grade A or Grade B.
(2) The taxpayer has not engaged in fraudulent VAT credit refund, fraudulent export tax refund, or the issuance of false VAT special invoices within 36 months prior to applying for the refund.
(3) The taxpayer has not been penalized by the tax authority for tax evasion two or more times within 36 months prior to applying for the refund.
(4) The taxpayer has not benefited from VAT “levy and immediate refund” or “levy first and refund later” policies since April 1, 2019, except as otherwise provided in this Announcement.
3. The taxpayers in the four industries including manufacturing as referred to in this Announcement are those whose VAT sales revenue derived from the businesses under “manufacturing industry,” “scientific research and technical services industry,” “software and information technology services industry,” and “ecological protection and environmental governance industry,” as classified in the Industrial Classification for National Economic Activities, accounts for more than 50% of their total VAT sales revenue. The sales ratio shall be calculated based on the sales revenue for the 12 consecutive months prior to applying for the refund. For taxpayers who have operated for less than 12 months but not less than three months prior to applying for the refund, the ratio shall be calculated based on the actual operating period.
4. The taxpayers in the real estate development and operation industry as referred to in this Announcement are those whose VAT sales revenue and advance receipts derived from the “real estate development and operation” business in the Industrial Classification for National Economic Activities account for more than 50% of their total VAT sales revenue and advance receipts. The ratio shall be calculated based on the sales revenue and advance receipts for the 12 consecutive months prior to applying for the refund. For taxpayers who have operated for less than 12 months but not less than three months prior to applying for the refund, the ratio shall be calculated based on the actual operating period. Advance receipts that have already been included in the ratio calculation during the same calculation period shall not be repeatedly included in the VAT sales revenue. Advance receipts refer to payments received from the pre-sale of self-developed real estate projects.
For taxpayers who, during the same calculation period, derive both VAT sales revenue or advance receipts from real estate development and operation and VAT sales revenue from other businesses, and who meet the requirements on the proportion of VAT sales revenue and advance receipts in first paragraph of this Article, the refund of their end-of-period excess input tax credit shall be handled in accordance with Item (2) and the second paragraph of Item (3) of Article 1 of this Announcement.
5. The VAT sales revenue as referred to in Articles 3 and 4 of this Announcement includes declared sales revenue, sales revenue determined through tax inspections and supplementary assessments, and sales revenue adjusted through tax assessments. For taxpayers to whom the levy of VAT on a deducted basis is applicable, the sales revenue shall be determined based on the pre-deduction amount.
6. After the tax authority approves a taxpayer's application for the VAT credit refund, if the taxpayer again meets the conditions for the refund under this Announcement, the taxpayer may continue to apply for a refund of the end-of-period excess input tax credit from the competent tax authority. However, the six consecutive months calculation period as required under Items (2) and (3) of Article 1 of this Announcement shall not overlap with the period already approved for the previous VAT credit refund application.
7. Taxpayers applying the policies under this Announcement shall calculate the refundable amount of the end-of-period excess input tax credit according to the following formulas:
(1) For taxpayers applying the policy under Item (1) of Article 1: Refundable VAT credit = End-of-period excess input tax credit for the current period × Input composition ratio × 100%
(2) For taxpayers applying the policy under Item (2) of Article 1: Refundable VAT credit = (Newly increased end-of-period excess input tax credit for the current period compared with the end-of-period excess input tax credit as of March 31, 2019) × Input composition ratio × 60%
(3) For taxpayers applying the policy under Item (3) of Article 1: Refundable VAT credit = (Newly increased end-of-period excess input tax credit for the current period compared with the end-of-period excess input tax credit as of December 31 of the previous year of the tax payment period prior to applying, up to CNY 100 million) × Input composition ratio × 60% + (Portion exceeding CNY 100 million) × Input composition ratio × 30%.
The input composition ratio for Items (1) and (2) of this Article refers to the proportion of VAT amount indicated on seven types of VAT credit vouchers-including VAT special invoices, customs import VAT payment certificates, tax payment certificates, uniform invoices for the sale of motor vehicles, electronic ordinary VAT invoices for toll road charges, electronic invoices (air transportation e-ticket itinerary), and electronic invoices (railway e-ticket)-that have been credited from April 2019 to the tax payment period prior to applying, against the total credited input tax amount during the same period.
The input composition ratio for Item (3) of this Article refers to the proportion of VAT amount indicated on the seven types of VAT credit vouchers that have been credited from January of the year of the tax payment period prior to applying to the tax payment period prior to applying, against the total credited input tax amount during the same period.
8. For taxpayers that export goods or conduct cross-border sales of services or intangible assets under the “VAT exemption, offset, and refund” measures, the “exemption, offset, and refund” procedure shall be completed first. After completion, if the taxpayer still meets the conditions under this Announcement, they may apply for the VAT credit refund in accordance with regulations. For taxpayers applying the “VAT exemption and refund” measures, the corresponding input tax amount shall not be used for the VAT credit refund.
9. Taxpayers who have obtained VAT credit refunds since April 1, 2019, may no longer apply for VAT “levy and immediate refund” or “levy first and refund later” policies. After a taxpayer has repaid in full the VAT credit refund previously obtained, they may apply for to enjoy the VAT “levy and immediate refund” or “levy first and refund later” policies for taxable transactions occurring from the month of repayment onwards.
Taxpayers who have enjoyed VAT “levy and immediate refund” or “levy first and refund later” policies since April 1, 2019, may apply for the VAT credit refund from the month following the full repayment of the VAT refunded under such policies.
After a taxpayer has fully repaid the refunded VAT as required above, whichever of the VAT credit refund or the “levy and immediate refund” or “levy first and refund later” policy is applied, the taxpayer may not switch policies within 36 months from the month following the full repayment.
10. Taxpayers may choose to carry over their end-of-period excess input tax credit to the next period for deduction, or, in accordance with this Announcement, if meeting the VAT credit refund conditions, apply for a refund during the VAT filing period of the following month after completing the current period's VAT filing.
After the tax authority approves a taxpayer's application for the VAT credit refund, the taxpayer shall reduce the excess input tax credit for the current period accordingly by the amount of the approved VAT credit refund.
If a taxpayer has obtained the VAT credit refund and it is later found that the taxpayer incorrectly applied the VAT credit refund policies, the taxpayer shall return the relevant refund before the end of the next VAT filing period.
If a taxpayer fraudulently obtains a VAT credit refund by concealing revenue, inflating input tax amounts, making false declarations, or other deceptive means, the tax authority shall recover the fraudulently obtained refund and handle the matter in accordance with the Law of the People's Republic of China on the Administration of Tax Collection and other relevant regulations.
11. This Announcement shall take effect on September 1, 2025. Article 8 of the Announcement of the Ministry of Finance, the State Taxation Administration, and the General Administration of Customs on Relevant Policies for Deepening the Value-Added Tax Reform (Announcement of the Ministry of Finance, the State Taxation Administration, and the General Administration of Customs[2019] No. 39), the Announcement of the Ministry of Finance and the State Taxation Administration to Further Step up the Application of End-of-Period Excess Input Value-Added Tax Credit Refund Policies (Announcement of the Ministry of Finance and the State Taxation Administration [2022] No. 14), the Announcement on Further Speeding up the Application of End-of-Period Excess Input Value-Added Tax Credit Refund Policies (Announcement of the Ministry of Finance and the State Taxation Administration [2022] No.17), the A Announcement on Further and Continuously Speeding up the Application of End-of-Period Excess Input Value-Added Tax Credit Refund Policies (Announcement of the Ministry of Finance and the State Taxation Administration [2022] No.19), and the Announcement on Expanding the Scope of Industries Eligible for the Policy of Full Refund of Incremental VAT Credits (Announcement of the Ministry of Finance and the State Taxation Administration [2022] No. 21) shall be repealed simultaneously.
For VAT credit refund applications that have been accepted by tax authorities prior to the implementation of this Announcement but have not yet been completed, the original provisions shall continue to apply.
This Announcement is hereby given.
