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Taiwanese resident corporations are subject to income tax on their worldwide income. Non-resident corporations, on the other hand, are subject to tax only on income derived within Taiwan through a branch or agent.

Taiwan levies value-added tax (VAT) on all taxable transactions that take place in the Republic of China (Taiwan), regardless of whether or not both parties to the transaction are located in Taiwan.

In order to be more in line with international standards, the Taiwan Government has amended tax regulations relating to use of logistics warehouses.

CFC stands for controlled foreign corporation. In order to better protect Taiwan’s tax base and follow international trends, Taiwan will introduce CFC rules effective from 1 January 2023. This is meant to prevent tax loopholes that result from complex international tax planning via CFCs

Taiwanese resident corporations are subject to income tax on their worldwide income. Non-resident corporations, by contrast, are subject to income tax only on income derived from sources within Taiwan, generally through a branch, agent, or other taxable presence.

The Statute for Industrial Innovation in Taiwan provides a legal framework for boosting industrial upgrading, R&D, and competitiveness through tax incentives.

Based on Income Tax Regulations that have existed for some years in Taiwan, hi-tech Companies and some high net worth individuals often make use of various tax planning tools to reduce or eliminate income tax liability. These Companies and individuals while representing a significant portion of Taiwan economy, yet only contribute limited amount of tax to society as a whole. As an effort to address this imbalance, Taiwan Tax Authority officially introduces Alternative Minimum Tax System effective from 1 January 2006. There are two AMTs, one for individuals and the other for corporations.

Qualifying foreign enterprises may apply for an advance ruling under Article 25 of the Income Tax Act, which allows corporate income tax to be assessed based on a deemed profit percentage.

For companies filing corporate income tax returns on a calendar-year basis, the filing deadline is five months after the end of the fiscal year. If the deadline falls on a weekend or public holiday, it is automatically extended to the next business day. As a general rule, this filing deadline cannot be extended.

An individual’s classification as a Taiwan tax resident directly affects income tax filing obligations and applicable tax treatment in Taiwan. Where there is uncertainty regarding an individual’s residency status, whether for personal circumstances or employment arrangements, professional advice should be sought.

An estate tax return is due within six months from the date of death. A three-month extension is available if an application is submitted before the original due date.

Expatriates taking up employment in Taiwan are subject to comprehensive tax rules and employment visa requirements. Grant Thornton’s Expatriate Tax team assists expatriates and their employers in navigating Taiwanese tax and immigration matters.

Force of attraction refers to rules for foreign enterprises in Taiwan that conduct business with domestic customers.

Taiwan gift tax shall be declared to the competent taxation authority within 30 days from the gift date.

Experience shows that, in most cases, it is not cost-efficient for a company to maintain books outside of Taiwan. Please consider the following regulations prior to deciding where to maintain your accounting record.

In Taiwan, if an enterprise has a fixed place of business or a business agent in Taiwan, then it is seen as having a permanent establishment and must register a legal entity.