According to Article 70 of Taiwan’s income tax audit regulations, the branch office of a foreign profit-seeking enterprise in Taiwan may share a portion of the nontrade-related management expenses of the head office or regional headquarters. The allocation of the management expenses to the Taiwan branch must be done on a revenue pro-rata basis computed over the total revenue of the company. Interest on capital provided to the branch must be excluded from the said management expenses calculation.

Jay Lo,Tax Partner , +886 (0)2 2789 0887 Ext. 314