China invoices professional time in RMB and applies VAT rules to many services. Everhour supports the billing workflow after the math.
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A billable-hours calculation answers one practical question: how much client-approved time should be charged for a project, matter, engagement, or service period in China. The result is usually a VAT-exclusive service amount in Renminbi yuan, plus VAT where the service is taxable and no statutory exclusion applies. The renminbi is China's legal tender, and its unit is the yuan.
The calculation does not decide whether every logged activity is billable. Your contract, engagement letter, scope of work, or firm policy decides that. Planning calls, client deliverables, legal review, implementation work, and project management can be billable when agreed. Internal admin, sales follow-up, rework outside scope, or training time is often non-billable unless the client agreement says otherwise.
Raw tracked time is the starting record, not the invoice amount. First remove non-billable entries, duplicate entries, write-downs, and time outside the approved scope. Then group the remaining time by rate: partner or senior consultant time, associate or analyst time, implementation time, review time, or any other line the client expects to see.
China does not impose one national billable-hour increment for professional services. For lawyers, national guidance says lawyer service fee items, billing methods, and fee standards are in principle set by the law firm and filed annually with the local lawyers association. For other professional services, the billing increment is normally chosen by contract, firm policy, or profession.
The core formula is approved billable hours multiplied by the agreed hourly rate. If a project has more than one rate, calculate each line separately and add the results. For example, a China advisory engagement has 24 approved consulting hours at RMB 1,200 per hour and 16 approved documentation hours at RMB 750 per hour.
The consulting line is RMB 28,800, and the documentation line is RMB 12,000, so the VAT-exclusive service amount is RMB 40,800. For a general VAT taxpayer, sales of services and intangible assets are taxed at 6% unless they fall into listed 13%, 9%, or zero-rated categories. Output VAT is the VAT-exclusive sales amount multiplied by the VAT rate, so 6% VAT adds RMB 2,448 and produces a RMB 43,248 invoice total.
A one-off calculation is enough when the job is small, the contract has one or two rates, all entries are already approved, and the invoice does not need recurring budget control. In that case, the useful output is simple: billable hours by rate, VAT-exclusive amount, VAT, and total due in RMB.
A managed workflow is better when projects repeat, budgets reset monthly or quarterly, or managers need warnings before time exceeds the client limit. Everhour Project Budgeting supports hour-based and money-based budgets, recurring budget periods, email alerts, budget protection, expense inclusion controls, multiple billing methods, and client-level budgets, so approved time can move from project work into billing without rebuilding the calculation each cycle.
This content is for general information only, may not be fully up to date, and is provided without any warranty or liability.
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Billable time is approved client work that the contract, engagement letter, or service order allows you to charge. It can include advisory calls, drafting, implementation, review, research, and project coordination. It excludes internal admin, duplicate entries, unapproved rework, and non-billable tasks unless the client agreement specifically makes those activities chargeable.
Yes, VAT applies to paid sales of services in China when the service is consumed in China or the seller is a Chinese domestic entity or individual, unless a statutory exclusion applies. A general VAT taxpayer usually applies 6% to the VAT-exclusive sales amount for services. Eligible small-scale taxpayers use the simplified 3% collection rate.
Keep the hourly rate column VAT-exclusive unless the contract states that quoted rates are tax-inclusive. The cleaner calculation is approved hours multiplied by the hourly rate, then output VAT calculated separately. China requires taxpayers to issue and use VAT invoices lawfully, and electronic VAT invoices have the same legal effect as paper VAT invoices.
Use the contract payment term. PRC law does not set a general statutory payment term. If the performance period is unclear and cannot be determined from the contract or course of dealing, the debtor may perform at any time and the creditor may request performance at any time after allowing necessary preparation time.
The common mistake is averaging all hours into one blended rate without client approval. If 24 consulting hours and 16 documentation hours use different rates, each line needs its own hours, rate, and amount. Blending hides rate differences, makes write-downs harder to review, and creates invoice disputes when the contract lists separate service categories.
Everhour Project Budgeting lets teams set hour-based or money-based budgets for client work, including one-time or recurring periods. Budget alerts can notify selected admins at defined thresholds, and budget protection can stop timers or prevent extra logging after a project exceeds its limit.
Everhour supports non-billable projects, fixed-fee projects, time-and-materials with project rates, time-and-materials with member rates, and custom task rates. That lets admins price work by the structure in the client agreement while keeping non-billable time separate from invoiceable totals.
Set project budgets, billing methods, and recurring limits before work begins. Everhour connects approved project time to budget control and billing review for cleaner RMB invoicing.
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