In August 2026, the “Positive and Negative Lists for Invoice Compliance” released by the State Taxation Administration has drawn widespread attention from the corporate finance and tax community. Adopting a “positive guidance + negative prohibition” approach, this list establishes “benchmarks” and “warning lines” for taxpayers regarding invoice issuance. Around the time the list was released, tax authorities in Chongqing, Ningxia, Hunan, Hainan, and other regions publicly exposed 37 cases of fraudulent invoice issuance, sending a very clear signal: invoice supervision has evolved from “post-event inspections” to “full-process risk monitoring.”

For small, medium, and micro-sized enterprises, invoice-related issues are often the most easily overlooked—yet the most likely to cause major problems. A single incorrect invoice can result in tax back payments and late fees at best, and criminal liability for issuing fraudulent invoices at worst. This is especially true in 2026, when digital invoices will be fully implemented. The entire process—from issuing and receiving invoices to issuing credit notes and archiving—will be fully digitized and traceable, meaning any action that does not align with actual business transactions will leave a trace in the system. Past practices of adjusting tax burdens by “finding invoices to offset costs,” “issuing invoices under false names,” or “issuing invoices at the last minute” are now completely unfeasible.

What companies really need to do is understand the four assessment criteria behind the compliance checklist and transform invoice management from a “reactive” approach to a “proactive risk management” strategy. Qicaiying Group specializes in providing domestic and international company registration services in Shenzhen, Guangzhou, Shanghai, Beijing, Hangzhou, Hong Kong, the U.S., Japan, South Korea, Southeast Asia, Singapore, the British Virgin Islands (BVI), the Cayman Islands, and more, as well as annual review and audit, bookkeeping and tax filing, tax compliance, information changes, bank account opening, ODI filing, FDI filing, and other corporate services; Hong Kong residency application, renewal, and permanent residency services; Singapore Employment Pass (EP) application services; and cross-border e-commerce mentoring and managed operations—all as part of our one-stop service. If you have any needs or are interested, please feel free to contact me at any time (Consultation Hotline: 18676749275, add WeChat: Qicaiyingjituan).

I. The “Four Dimensions” of the Invoice Compliance Checklist: Core Criteria for Determining Whether an Invoice Is Compliant

The State Taxation Administration has clarified that determining whether an invoice is compliant requires a step-by-step comparison against four criteria. While these four criteria may seem basic, they are precisely where practitioners are most likely to run into problems.

First, whether the entities issuing and receiving invoices are in compliance. The circulation of invoices must occur between genuine transacting parties; the issuer, the recipient, the provider of goods or services, and the party receiving or paying the funds must all be the same. If an invoice is issued by a third party on behalf of another, received by an unrelated party, or if the issuer does not match the actual seller, these situations constitute non-compliance regarding the transacting parties. Common practices in business, such as “issuing invoices under a nominal entity,” “issuing invoices for accounting purposes,” and “using invoices to offset costs,” are all deemed non-compliant in this regard.

Second, whether the production and business operations are genuine and valid. The transactions listed on an invoice must have actually occurred, have a reasonable commercial purpose, and conform to common sense regarding business transactions. Tax authorities will conduct a “four-flow consistency” verification by cross-checking the contract flow, goods/service flow, fund flow, and invoice flow. If an invoice exists without a corresponding contract, shipping documents, or payment vouchers, or if the transaction amount significantly deviates from market prices, the transaction will be deemed fictitious.

Third, are the information elements on the ticket filled out completely and accurately? In the era of digital invoices, the information on the invoice must match the nature of the business, the type of entity, and the applicable tax rate. For example, issuing invoices for consulting services under vague categories such as “conference fees” or “service fees,” or combining multiple transactions with different tax rates and natures into a single invoice, will affect tax calculations and be flagged by the system as a risk. The issuance of credit invoices must also be based on sufficient grounds and follow standardized procedures.

Fourth, whether the time limit for issuing invoices complies with regulations. Invoices should be issued when business revenue is recognized following the completion of a business transaction; they must not be issued in advance, after the fact, or in a concentrated burst. The negative list specifically notes that the following scenarios are key targets for tax audits: issuing a large number of invoices at a specific time after a long period of inactivity and then absconding; issuing invoices in a concentrated manner before or after a change in the legal representative; and issuing invoices in a concentrated manner prior to business deregistration.

II. The Three Major “High-Risk Actions” Behind 37 Cases of Fraudulent Invoicing”

Based on the 37 cases disclosed by tax authorities across the country, corporate invoice risks are primarily concentrated in three types of conduct. Each category involves typical modus operandi, as well as clear compliance alternatives.

Category 1: Issuing invoices without an actual transaction, or where the invoice details do not match the substance of the transaction. For example, some companies issue invoices for actual consulting services under broad categories such as “meeting fees” or “service fees,” or combine transactions subject to different tax rates on a single invoice to conceal the true nature of the business. Such practices not only result in the inputting tax being ineligible for deduction but may also be deemed the issuance of fraudulent invoices.

Category 2: Extensive use of personal bank accounts, WeChat, Alipay, or cash to collect payments, without filing tax returns. The negative list explicitly classifies “extensive use of personal accounts, WeChat, Alipay, or cash to receive payments, where the related income has not been reported for tax purposes” as non-compliant behavior. Businesses should open and properly use corporate bank accounts; even when third-party payment services are used in special circumstances, funds should be promptly transferred to corporate bank accounts and accurately reported.

Category 3: Last-minute invoicing,集中 invoicing prior to deregistration, and集中 invoicing before and after a change in legal representative. These actions are often accompanied by subjective malice and are a key focus of tax audits. If a company has compliant transactions for which invoices have not been issued, it should issue invoices in accordance with standard procedures and retain contracts, payment vouchers, and other supporting documents for future reference; under no circumstances should it take chances.

To address invoice compliance risks, Qicaiying offers an integrated service package covering “bookkeeping and tax filing + tax compliance + invoice management”: We help businesses establish invoice issuance review processes, received invoice verification mechanisms, credit memo approval systems, and standards for electronic archiving; we conduct specialized investigations into historical invoice risks and assist with corrective actions and document supplementation; and provides policy interpretation, evidence organization, and communication support during tax audits. Qicaiying Group specializes in domestic and international company registration services in Shenzhen, Guangzhou, Shanghai, Beijing, Hangzhou, Hong Kong, the U.S., Japan, South Korea, Southeast Asia, Singapore, the BVI, the Cayman Islands, and other locations, as well as annual reviews and audits, bookkeeping and tax filing, tax compliance, information updates, bank account opening, ODI filing, FDI filing, and other corporate services; Hong Kong residency application, renewal, and permanent residency services; Singapore EP application services; cross-border e-commerce support and agency operations—all as part of our one-stop service. If you have any needs or are interested, please feel free to contact me at any time (Consultation Hotline: 18676749275, add WeChat: Qicaiyingjituan).

III. End-to-End Risk Monitoring of Digital Invoices: Three Key Areas Where Companies Must Upgrade Their Invoice Management

By 2026, nationwide adoption of standardized digital electronic invoices will be fully implemented, and traditional paper invoices and tax control disk systems will be phased out of routine use. Digital electronic invoices not only offer convenience but also provide regulatory benefits such as end-to-end audit trails, data traceability, and the ability to anticipate risks. Businesses must upgrade their management practices in the following three areas.

Part 1: Pre-invoicing Review. Establish a four-tier review mechanism covering “transaction authenticity—applicable tax rate—invoice details—consistency of parties.” All invoice requests must be accompanied by a contract, purchase order, or business confirmation form; financial staff should verify that the transacting parties, amount, tax rate, and nature of the transaction match; and set up early warnings for situations such as abnormally large amounts, frequent credit memos, and the consolidation of invoices across different tax rates.

Part 2: System Controls During Invoicing. The digital invoice system is connected in real time to the State Taxation Administration. Enterprises should properly manage permissions for invoicing terminals to prevent multiple users from sharing a single invoicing account; establish an approval process for credit notes to ensure they are issued on sound grounds; and regularly review invoice inventory and issuance records to prevent irregular invoicing.

Step 3: Post-Invoicing Filing and Review. Electronic records of digital invoices should be retained in their entirety, including invoice template files, contracts, shipping documents, payment vouchers, and acceptance records. Enterprises should periodically review and verify input invoices, promptly returning or transferring any irregular invoices; they should also compare output invoices with revenue reporting data to ensure that the accounting records match the invoices.

IV. Self-Inspection Checklist for Corporate Invoice Risks: Eight Mandatory Items and Three “Immediate Corrective Actions”

By referring to the positive and negative lists and audit case studies, companies can immediately conduct a self-inspection based on the following checklist.

Eight Mandatory Checks:

1. Are there any invoices for transactions that did not actually take place or where the transaction details do not match those on the invoice?;

2. Are there instances where a large number of payments were received through personal accounts, WeChat, or Alipay but were not reported?;

3. Whether there is a pattern of issuing a large number of invoices all at once after a prolonged period of inactivity;

4. Whether there were any instances of issuing invoices in a rush prior to a change in the legal representative or business dissolution;

5. Do the input invoices match the purchase contracts, shipping documents, and payment records?;

6. Do the sales invoices match the sales contracts, shipping records, and payment records?;

7. Whether the red-ink invoices are supported by sufficient evidence and have been approved;

8. Are the electronic records of digital invoices preserved in their entirety and traceable?

Three “Immediate Corrective Actions”:

• Immediately cease the practice of receiving payments through personal or third-party accounts without recording them in the books; all business income must be deposited into a corporate bank account and accurately reported;
• Immediately clean up historical “problematic invoices,” and promptly reverse the input tax credits and adjust the cost allocations for invoices that are not supported by actual business transactions;
• Immediately establish an internal control system for invoice management, clearly defining the responsible parties and approval processes for issuing, receiving, and canceling invoices, as well as archiving them.

Invoice compliance is the first line of defense for corporate financial and tax compliance, and it is also the most direct focal point for data comparison under the “Golden Tax Phase IV” initiative. Qicaiying Group specializes in providing domestic and international company registration services in Shenzhen, Guangzhou, Shanghai, Beijing, Hangzhou, Hong Kong, the United States, Japan, South Korea, Southeast Asia, Singapore, the British Virgin Islands (BVI), the Cayman Islands, and other locations, as well as services such as annual company audits, bookkeeping and tax filing, tax compliance, information updates, bank account opening, ODI and FDI filings, as well as other corporate services; Hong Kong identity application, renewal, and permanent residency services; Singapore EP application services; and cross-border e-commerce mentoring and agency operations—all as part of our one-stop service. If you have any needs or are interested, please feel free to contact me at any time (Consultation Hotline: 18676749275, add me on WeChat: Qicaiyingjituan).

Compliant invoicing is not an unnecessary formality; rather, it is a fundamental requirement for a company’s survival in the era of “data-driven tax administration.” Only by maintaining strict control over invoices can tax risks be minimized; only by preserving a complete chain of evidence can a company stand firm during tax audits.