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Amendment of Regulations Application to Taxes on Income
A series of revision promulgated by Ministry of Finance in Taiwan recently, which were a significant revision since the initial promulgation in 2021. One of the must-see points in this revision is the adoption of “Principle Purpose of Test” under the global attention. Generally speaking, the Taiwan government will inspect if the enterprises are going to evade
The Important Notice for Tax Reduction in Taiwan (For whom paid tax in China)
For Taiwanese who have any source of income in China, these citizens should declare the individual income tax in May annually with the tax incurred in China jointly. Therefore, If the tax in China has already declared and paid, the tax payable in Taiwan can be deducted from to avoid the event of dual imposition of tax occurring.
CFC Regulation in Taiwan - Individual
The purpose of Controlled Foreign Company (Hereafter referred to as CFC) regulation is to avoid profit-seeking enterprise, which established its company in low-tax rate burden country (Profit-seeking enterprises income tax rate less than 14%, like BVI; or only pay the domestic income tax, like Hong Kong or Singapore)without any practical business activity via CFC, evading the tax payable with the practical control
Attention to the List Price for Taxable Goods or Services in Taiwan
Business models and styles have been more diversified nowadays. No matter the business is run online or in physical stores, the list price of taxable goods or services should include business tax in it. However, some online stores claim that they do not include business tax in the list price and require an additional 5% business tax charge to their clients, which lead to consumption disputes.
Attention to the Prescription on the Outstanding Accounts Payable for Taiwan Companies
It is inevitable that accounts payable happens in businesses. The Taiwan National Taxation Bureau reminds that when companies declare for corporate income tax, it is important to pay attention to the prescription on various kinds of outstanding accounts payable, which can vary from 2 – 15 years. Furthermore, if a payment is unsettled upon prescription, it must be changed to other income in accounting in that current year.
Individual Online Sellers Should Apply for Taxation Registration
The threshold of individual online sellers who run online businesses for profit-making purpose, was based on the total “average” sales in the last six months. However, online shop transactions have become more frequent in recent years, the Taiwan Ministry of Finance issued an explanatory order at the end of January 2020, stating that the business tax threshold of online seller has been changed
The Impact of Taiwan Civil Code New Amendment on Taxation
According to Taiwan Civil Code, the age of majority has been lowered to 18 years old. The Taiwan Executive Yuen also amended the regulations of tax allowance in the Income Tax Act and the Estate and Gift Tax Act accordingly.In terms of income tax, what is affected is the dependent support regulations. According to the previous version, the taxpayer’s children who are under 20 years old or over 20 years old but are still in school
Provisions on Taiwan Branch Sharing Headquarter Expenses
According to the “Regulations Governing Assessment of Profit-Seeking Enterprise Income Tax” Article 70, when a foreign company Taiwan branch is filling tax, it can apportion the management expenses of its headquarter. However, there are two constrains which have to be aware of: 1.Firstly, the apportionment party is designated to the headquarter or regional headquarter, etc., and limited to non-operating departments only;
Documents Required for Taiwan Companies Reporting Overseas Investment Loss
According to the Regulations Governing Assessment of Profit-Seeking Enterprise Income Tax Article 99 Subparagraph 2 “Investment loss should provide prove on capital reduction to cover losses, merger and acquisition, bankruptcy or liquidation. However, if the invested business located in a foreign country and did not participate in any actual operating activities,
Taiwan Company should Declares Income Even if They do not Generate Taxable Income
Many companies thought that underreporting the income of the company will not have a penalty as they do not generate taxable income. Actually, according to the regulation of Income Tax Act, where a profit-seeking enterprise, due to tax exemption provided under the incentive statute or because of the business deficit, shall not have a taxable income even though the amount of income omitted or under-reported is added to it