Export tax rebates for hardware structural components represent a significant source of profit for exporting enterprises, yet they are also a high-risk area for tax audits. In January 2026, the State Taxation Administration issued the “Administrative Measures for VAT and Consumption Tax Rebates (Exemptions) on Export Business,” further standardizing the relevant processes and requirements.
This article outlines the complete processing workflow, covering: method selection → filing → declaration → receipt of foreign exchange → documentation filing.
I.
Determine the Applicable Method
Manufacturing enterprises exporting self-produced goods are subject to the “Exemption, Credit, and Refund” method: output tax at the export stage is exempted;
input tax from domestic purchases is first used to offset tax payable on domestic sales, with any remaining un-offset amount being refunded. Foreign trade enterprises (which purchase goods from manufacturers for re-export) are subject to the “Exemption and Refund” method (tax is levied first and then refunded): the purchase price includes input tax, and the refund is calculated based on the applicable rebate rate after export. Two major prerequisites apply: the enterprise must be a general VAT taxpayer, and the goods must have cleared customs and left the country, foreign exchange must have been received, and all required documentation must be complete.
The specific rebate rate for hardware structural components is determined by the rate corresponding to the product’s HS code;
different customs classifications result in different rebate rates—therefore, it is essential to verify the correct HS code before declaration.
II. Filing for Export Tax Refund/Exemption
Before filing for an export tax refund/exemption for the first time or applying for the issuance of a tax refund certificate, you must complete the filing formalities with the competent tax authority: log in to the Electronic Tax Bureau and navigate to the module “Tax Services → Export Tax Refund Management → Qualification Information Report for Export Tax Refund/Exemption Enterprises → Export Tax Refund/Exemption Filing.” Fill out the “Export Tax Refund/Exemption Filing Form” and submit the required supporting documents (e.g., business license, proof of export operation rights).
You may only proceed with the actual declaration after the filing is completed.
III.
Declaring the Tax Refund (Core Process)
After customs clearance/export and the issuance of export invoices: Step 1: Obtain the customs declaration form (the most critical document for the refund); Step 2: Collect declaration data based on export details (details of exported goods and proof of purchase—foreign trade enterprises must obtain compliant special VAT invoices); Step 3: Generate declaration data and submit the formal declaration; Step 4: The tax authority reviews and approves the claim, followed by the issuance of the refund.
There are strict deadlines for declaration: the claim must be filed during any VAT tax declaration period between the month following the date of customs clearance for export and April 30 of the following year; failure to declare by the deadline is deemed a waiver of the tax refund.
IV.
Receipt of Foreign Exchange and Deemed Receipt
Exported goods subject to a tax refund claim should have their foreign exchange proceeds received by the declaration deadline; if payment is not received on time, the tax authority will suspend the refund process, and any refund already issued must be returned.
In cases meeting the criteria listed in the “List of Reasons and Supporting Materials for Deemed Receipt of Foreign Exchange” (e.g., contracts stipulating deferred payment, foreign exchange controls, customer bankruptcy, etc.), retaining the “Statement on Foreign Exchange Receipt for Exported Goods” and relevant supporting materials allows the transaction to be treated as a deemed receipt of foreign exchange.
Proof of foreign exchange receipt must correspond one-to-one with the customs declaration form and the invoice—”incomplete foreign exchange receipt documentation” is the primary reason for the rejection of tax refund claims.
V. Record-Keeping Documents (Do Not Overlook)
Within 15 days of declaring an export tax refund or exemption, you must organize the required record-keeping documents according to the declaration sequence and complete the “Catalog of Export Goods Record-Keeping Documents” for future reference. These documents include purchase and sales contracts (export contracts, procurement contracts, etc.), transport documents (shipping orders/bills of lading), customs declaration agency agreements (if applicable), customs declarations, and invoices. The retention period for these documents matches the verification period for tax refund materials;
incomplete or missing documents may result in the recovery of refunded taxes and the imposition of penalties.
VI.
Practical Recommendations
First, establish tax refund files on a per-transaction basis: one file per transaction (customs declaration + invoice + foreign exchange receipt + contract). Archive documents immediately upon receipt of foreign exchange so that batch declarations can be made as soon as the filing period opens. Second, assign specific personnel to monitor declaration and foreign exchange collection deadlines and set calendar reminders—remember that April 30 of the following year is the critical “make-or-break” deadline. Third, ensure the amounts on export invoices match those on customs declarations to avoid the risk of inaccurate reporting—specifically, inflating values for refunds while under-reporting for customs purposes.
Fourth, track changes in tax refund rates and verify details promptly whenever policies are adjusted. Industry experts advise that the export tax refund process requires meticulous care: only with complete documentation, strict adherence to deadlines, and accurate data can the refund be successfully secured;
otherwise, all the effort goes to waste, and you may even end up paying fines.
