Taiwan Tax Compliance Map
Here Compliance Map includes : Taiwan Corporate Income Tax, Taiwan business value-added tax.
Contact us:
E-mail: tpe4ww@evershinecpa.com
or
Contact us during office hours (Taipei and China Time Zone)
Director Jerry Chu, USA Graduate School Alumni and a well-English speaker
Mobile: +886-939-357-735
Tel No.: +886-2-2717-0515 ext. 103
GLA – Taiwan Corporate Income Tax
GLA-TW-01 GLA Tax Entity
Question from client:
Is Taiwan corporate income tax a national income tax? A local income tax? Or is there a national and local income tax?
What if the national income tax and the local income tax are levied separately or levied together?
What is the standard tax rate? What is the special tax rate?
Answer from Evershine RD:
Taiwanese corporate income taxes are imposed on a national level.
There is no local corporate income tax in Taiwan.
The standard corporate tax rate is 20%.
Taiwan imposed an alternative minimum tax (AMT) of 12% but exclude those profit-seeking enterprise with a basic income of less than NT$500,000.
GLA-TW-02 Registration
Question from client:
Which government unit is responsible for the collection of Taiwan corporate income tax?
The registration of the country’s corporate income tax status, that is, the tax certificate number application procedure, paper certificate number application? Or an online account application? URL?
What is the advance certificate number for applying for this certificate number?
Do I need to use the industrial and commercial certificate electronic card to apply?
Answer from Evershine RD:
The Ministry of Finance (MOF) authorizes the national tax bureau to administer income tax in Taiwan.
A business entity shall fill in the application for establishment registration and check the relevant attachments and go through the tax registration with the local competent taxation authority.
(For relevant attachment information, please refer to the “Check Form for Documents Attached to Tax Registration”.
If your business location is located in Taipei City, you can refer to the Taipei Tax Bureau website path: Home/Service Corner/Theme/Tax Zone/Business Tax/Tax registration.)
you can go to the one-stop online application platform http://onestop.nat.gov.tw or contact the local IRS or 0800-000-321 for inquiries.
An industrial and commercial certificate is required for online declaration.
If you do not have an industrial and commercial certificate, please go to tax.nat.gov.tw to apply for a simple PIN number.
GLA-TW-03 GLA Order (OD)
Question from client:
What is the order of Taiwan corporate income tax return (information flow determines tax base) and payment (fund flow)?
Pay first and then declare? Report first and then pays?
At the same time as the declaration and payment?
Answer from Evershine RD:
Deposit first (DF). Pay by installment first and declare later.
GLA-TW-04 Mechanism of Filing (MOF)
Question from client:
What is the return method for Taiwan corporate income tax return (information flow determines the tax base)?
Filing cycle: monthly? Every bimonthly? Every season? every half year? Per year?
Electronic filing? Manual filing? Electronic filing and manual filing coexist?
If electronic filing is possible: website URL?
Answer from Evershine RD:
An industrial and commercial certificate is required for online declaration. If you do not have an industrial and commercial certificate, please go to tax.nat.gov.tw to apply for a simple PIN number.
Corporate taxpayers must make a provisional filing to the Treasury during September of each year.
For online reporting software download and installation, visit https://tax.nat.gov.tw/alltax-download.html?id=5
Corporate tax returns are due in May each year (from May 1 to May 31).
Income earned subject to tax in 2021 will be reported in the tax return filed in 2022.
Corporations may choose to file their income tax returns either on paper or electronically.
For online reporting software download and installation, visit https://tax.nat.gov.tw/alltax-download.html?id=4
GLA-TW-05 Mechanism of Payment (MOP)
Question from client:
What is the funding method for Taiwan corporate income tax payment (funds flow)?
Payment cycle: M per month? B every bimonthly? Q every season? H every six months? A every year?
Automatically authorize deduction of ACH (that is, take the initiative of the recipient)?
Electronic remittance to EFT (that is, the payer takes the initiative)?
Bank counter payment OCT?
Or the above methods coexist?
Answer from Evershine RD:
Corporate taxpayers must make a provisional payment to the Treasury during September of each year.
The amount of this provisional payment should be equivalent to one-half of the corporate income tax payable in the previous year.
Alternatively, a corporate taxpayer that keeps complete accounting books and records, entrusts a CPA to examine and certify its provisional tax return, and files the return within the prescribed period, it may compute the provisional tax payment based on the operating income derived in the first 6 months of the current year at the current year’s applicable tax rate.
Taiwan does not require companies (regardless of whether foreign or domestic) to establish a local bank account and provide for electronic transfers to the tax authorities.
Please go to the software download and tax declaration section of the online tax declaration webpage to download the latest version of the program and install the software and then make payment.
Submit the following at https://www.etax.nat.gov.tw/etwmain/etw144w to obtain the barcode and then proceed to make payment.
Form 355 – Income Tax provisional tax payment form (self-payment)
Form 357 – Income Tax settlement tax payment form (self-payment)
VAT – Taiwan VAT
VAT-TW-01 VAT Tax Entity
Question from client:
Is Taiwan VAT National VAT? Local VAT? Or is there a national plus Local VAT?
What if the National VAT and Local VAT are levied separately or levied together?
What is the standard VAT rate? What is the special VAT rate?
Answer from Evershine RD:
Business tax is a national tax levied by the central government of Taiwan. There is no separate state, provincial or local indirect taxes in Taiwan.
The Ministry of Finance authorizes national tax bureaus and customs offices to administer business tax in Taiwan.
The Taxation Administration of the Ministry of Finance is in charge of designing tax policies and the taxation system, and it supervises the collection of taxes and duties at all levels of the tax offices.
Taiwan’s business tax consists of two tax systems:
VAT and Gross business receipts tax (GBRT).
In Taiwan, the following VAT and Gross Business Receipts Tax rates apply.
Standard rate: 5%
Other: Zero rate and exemptions
Gross business receipts tax (GBRT): 0.1%, 1%, 2%, 5%, 15% and 25%
In general, seven industries, namely banking, insurance, investment trust, securities, futures and commercial papers businesses and pawnshops, are subject to GBRT. Other businesses are subject to VAT.
Unlike VAT, GBRT is nonrecoverable (i.e., not eligible for input tax deductions).
VAT-TW-02 Registration
Question from client:
Which government unit is responsible for the levying of VAT in Taiwan?
The registration of Taiwan’s VAT levy status, that is, the application procedure for VAT certificate number, paper certificate number application? Or online account application? URL?
What is the advance certificate number for applying for a VAT certificate number?
Do I need to use an industrial and commercial certificate electronic card to apply?
Answer from Evershine RD:
Any person that wishes to conduct business in Taiwan must apply for business tax registration with the competent tax authority before starting the business.
Certain small businesses are exempt from the requirement to register for business tax if their monthly turnover does not exceed NTD40,000 (trading entities, manufacturing, publishing, agriculture, fishing, and mining) or NTD 80,000 (decorating, advertising, repairs and processing, hotels, labor, warehousing, leasing, design, and technology).
There is no voluntary registration mechanism in Taiwan.
The application form number is “Form No: 4-1-2”.
It normally takes 7 to 14 business days for the competent tax authority to review and grant the approval letter.
The Taxation Administration then assigns the business a nine-digit VAT number.
VAT-TW-03 WWT Order (OD)
Question from client:
What is the order of Taiwan’s VAT declaration (information flow determines the tax base) and payment (fund flow)?
Pay first and then declare? First declare and then pay?
At the same time as the declaration and payment?
Answer from Evershine RD:
Same period (SP): Filing of VAT return and pay the taxes due by the same time.
VAT-TW-04 Mechanism of Filing (MOF)
Question from client:
What is the return method for Taiwan VAT declaration (information flow determines the tax base)?
Reporting cycle: every month? Every bimonthly? Every season? every half year? Per year?
Electronic filing? Manual filing? Electronic filing and manual filing coexist? If electronic filing is possible: Website URL?
Answer from Evershine RD:
Company is required to file a bimonthly business tax return with other relevant documents every alternate month, starting with January (i.e., January, March, May, etc.).
Returns may be filed any time before the 15th day of the month for the sales made during the previous two months (e.g., a filing period from 1 September to 15 September, for sales during the preceding months of July and August).
However, those who apply for zero tax rate for export may apply for a monthly declaration but cannot be changed within the same year after the application.
Any amount of outstanding business tax must first be paid to the National Treasury; the receipt for the tax payment may then be submitted together with the tax return.
For online reporting software download and installation, visit https://tax.nat.gov.tw/alltax.html?id=2
VAT-TW-05 Mechanism of Payment (MOP)
Question from client:
What is the funding method for Taiwan VAT payment (funds flow)?
Payment cycle: M per month? B every bimonthly? Q every season? H every six months? A every year?
Automatically authorize deduction of ACH (that is, take the initiative of the recipient)?
Electronic remittance to EFT (that is, the payer takes the initiative)?
OCT payment at the bank counter?
Or the above methods coexist?
Answer from Evershine RD:
Under Taiwanese law, the company must pay the National Treasury on or before the 15th day of the month any amount of outstanding business tax for the previous two months’ period (e.g., payment by or before September 15 for July and August).
Under Taiwanese law, all business operators must pay their business tax payable to a bank designated by the National Treasury for collecting tax before they file their business tax return with the local tax office where they are located.
Submit the VAT at https://www.etax.nat.gov.tw/etwmain/etw144w/401 to obtain the barcode and then proceed to make payment.
Payment method:
(1) Over-the-counter payment: Please pay at the financial institution that collects the tax on your behalf (the post office does not collect it on your behalf). For cases where the tax amount is less than 30,000 yuan, you can pay at the convenience stores such as 7-Eleven, Family Mart, Hilife, and OK Mart. Re-reporting and re-payment cases are not applicable).
(2) Payment by chip financial card internet transfer (not applicable to cases of automatic re-reporting and re-payment): Please go to the online tax payment service website (URL: https://paytax.nat.gov.tw) to pay.
(3) If the payment is made at a convenience store or by bank transfer with a chip financial card, the payment deadline is open until 24:00 on the 3rd day after the expiration of the payment deadline, and if the payment is made within 3 days after the expiration of the payment deadline, it is still a case of overdue payment.
* * Please note the following:
The above is summarized by Evershine R & D and Education Center in October 2021.
Over time, regulations may change, and different options may be used in different situations.
So before choosing an option, please contact us or consult a professional you trust in the field.
Contact us:
E-mail: tpe4ww@evershinecpa.com
or
Contact us during office hours (Taipei and China Time Zone)
Director Jerry Chu, USA Graduate School Alumni and a well-English speaker
Mobile: +886-939-357-735
Tel No.: +886-2-2717-0515 ext. 103
Additional Information
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(version: 2024/07)
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