![]() ![]() Additionally, a 10% sales tax is charged against properties sold after being owned for between one and two years. The law imposes a 15% sales tax on owners of second homes who sell within one year of purchase. Real estate speculation and the luxury tax Īimed at cooling off real estate speculation that was driving up the cost of living in Taipei City and other urban areas, the Republic of China government implemented a new luxury tax in June 2011. This tax is governed by the regulations set forth in the Securities Transaction Tax Act. A rate of 0.1% applies on the gross proceeds of corporate bonds, however, an exemption has been put in place through 2016. ![]() This tax is paid by sellers of Republic of China securities at a rate of 0.3% of the gross proceeds from the sale of shares issued by companies. Value-added tax (VAT) in Taiwan is currently 5% as of 1 June 2023. The amount of tax payable shall not exceed half of the amount of the taxable income in excess of NT$120,000.īusiness tax ( value-added tax) Tax amount = (sales - purchases) * tax rate Therefore, the current profit-seeking enterprise tax rates are as follows: Taxable Income In 2010, the top tax rate was reduced from 25% to 17%, and the threshold below which no tax is owed was raised from NT$50,000 to NT$120,000. Income tax rate of profit-seeking enterprises However, their portion of the taxable income is reported on their individual income tax return. Sole proprietors and partners must file a return. Profit-Seeking Enterprise Income Tax Īll profit-seeking businesses in Taiwan are subject to the Profit-Seeking Enterprise Income Tax. Taxpayers, including foreigners, are able to complete and file their tax return electronically through software provided by the local taxing authority. Income tax returns are due by May 31 of the following year, with no extension of time allowed. For the 2017 tax year, the tax rates were as follows: Brackets (Unit NT$)īy default, the tax year for all individuals and profit-seeking enterprises follows the calendar year. Taiwan has implemented a progressive tax system for individual income taxes. One major exception to this rule exists for non-residents who are physically present in Taiwan for less than 91 calendar days in a year and who are only paid compensation by offshore entities. Income received in exchange for services rendered while physically present in Taiwan is considered to be Taiwan-sourced income regardless of if the payer is a local or offshore person or entity. ![]() Individuals are considered residents of Taiwan for tax purposes if they are either domiciled there, or spend for 183 days or longer in a taxable year. Individual income tax īoth residents and non-residents are assessed individual income tax on Taiwan-sourced income unless an exception is provided in the Income Tax Act and related laws. The Income Tax Act is the primary law that governs individual income and profit-seeking enterprise income taxes. As the chief legislative body, the Legislative Yuan plays an important role in formulating and revising tax related laws. Rather, taxes are governed by a series of laws and regulations each related to a specific type of tax. Unlike the Internal Revenue Code in the United States, there isn't one law that governs taxation in Taiwan. Individual municipalities, counties, and cities have set up Revenue Service Offices responsible for collecting a range of taxes, including: Local taxes Brief classification of real estate related tax in Taiwan
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