News

The National Taxation Bureau of Taipei, Ministry of Finance, stated that the Controlled Foreign Company (CFC) system has been in effect since 2023. When calculating the investment income of a CFC for the current year, profit-seeking enterprises shall not deduct the accumulated losses recorded in the CFC's accounts prior to the implementation of the CFC system.

Fengyuan Branch, National Taxation Bureau of the Central Area, Ministry of Finance stated that, according to Articles 4-4 and 24-5 of the Income Tax Act, when a profit-seeking enterprise sells houses or land acquired after January 1, 2016, the transaction income or loss shall be calculated by deducting relevant costs, expenses, or losses from the total income. The remaining balance is the taxable income, which shall be taxed separately at the applicable rate of 45%, 35%, or 20%, depending on the holding period of the property, and then consolidated for payment.

The National Taxation Bureau of Taipei, Ministry of Finance, announced that heirs who have paid their respective shares of estate tax can apply for a “Certificate of Consent to Transfer for Joint Ownership.” This enables them to proceed with the registration of inherited property as joint ownership, preventing the estate from being officially recorded for monitoring by land administration authorities.

Recently, southern Taiwan was struck by torrential rains. Some profit-seeking enterprises located in low-lying areas suffered from flooding that resulted in the premature destruction or scrapping of machinery and equipment within their factories, even though the assets had not yet reached their prescribed service life. The National Taxation Bureau of the Southern Area, Ministry of Finance, stated that in accordance with Article 57 of the Income Tax Act, enterprises may provide supporting documents to claim the undepreciated book value of the fixed assets as a loss for the year.

The National Taxation Bureau of Taipei, Ministry of Finance states that any individual, whether a Taiwanese or foreign national, who has income or loss derived from transactions of house and land (hereinafter referred to as “property”) acquired on or after January 1, 2016 shall file an individual house and land transactions income tax return in accordance with the Income Tax Act within 30 days from the following day of the day on which the house and land ownership transfer registration is completed.

The National Taxation Bureau of Taipei, Ministry of Finance states that, in accordance with Paragraph 1, Article 7 of the Act for the Development of Biotech and Pharmaceutical Industry, to encourage the establishment or expansion of biotech and pharmaceutical companies, a profit-seeking enterprise that (i) originally subscribes for or underwrites shares issued by a biotech and pharmaceutical company

The National Taxation Bureau of Taipei (NTBT), Ministry of Finance, states that, differences between book value and year-end valuation on accounts receivable or accounts payable denominated in foreign currencies are unrealized exchange gains or losses. These unrealized gains or losses shall be excluded from annual Profit-Seeking Enterprise Income Tax Returns.

The National Taxation Bureau of Taipei, Ministry of Finance, states that taxpayers who are prohibited from the disposal of property due to overdue taxes may offer third-party property of equivalent collateral value to the outstanding tax payable. This property will serve as a guarantee when applying to have the disposal prohibition written off.

We are delighted to announce that in February this year, Yaofeng CPA Firm officially entered into a partnership with the renowned Australian accounting firm Hall Chadwick. We have since established Hall Chadwick Taiwan, combining our local expertise with international resources to provide our clients with more comprehensive professional services.

The National Taxation Bureau of Taipei, Ministry of Finance stated that in accordance with Article 43-3 of the Income Tax Act, if a profit-seeking enterprise holds shares or capital of a foreign affiliated enterprise located in a low-tax country or jurisdiction (hereinafter referred to as low-tax jurisdiction) that meets the definition of a controlled foreign company (hereinafter referred to as CFC), and such CFC does not qualify for exemption provisions, the profit-seeking enterprise shall recognize CFC investment income and include it in the taxable income for the current year.

The National Taxation Bureau of Taipei, Ministry of Finance states that when taxpayers are dissatisfied with the tax assessments made by tax authority, they may apply for rechecks in accordance with Article 35 of the Tax Collection Act. After the original competent authority makes a recheck decision, if taxpayers remain dissatisfied, they may file administrative appeals with the Ministry of Finance through the original competent authority in accordance with Article 14 of the Administrative Appeal Act. However, attention should be paid to the statutory deadline for filing administrative appeals.

The Controlled Foreign Company (CFC) Rules were officially implemented in 2023. If a profit-seeking enterprise holds shares or capital of a foreign company that satisfies the definition of a CFC and the CFC does not qualify for the exemption threshold, it must recognize the CFC’s investment income in accordance with Article 43-3 of the Income Tax Act and include it in the current year’s taxable income.