Taiwan Business Tax Guide: VAT & Income Tax Filing Made Simple
- Del Sol CPA
- 3 hours ago
- 2 min read
Understanding Tax Obligations After Establishing a Company in Taiwan. Once you have set up your company in Taiwan, addressing tax obligations becomes a fundamental aspect of running a successful business. Two key taxes you will encounter are:
Value-Added Tax (VAT)
VAT is levied at a rate of 5% on every sale. It is filed bi-monthly, with the filing deadline on the 15th of each odd month. Through VAT, you can reduce your tax liabilities by collecting fapiaos (invoices) for business-related expenses such as gas, stationery, and other work necessities. Remember, fapiaos from domestic companies are key for deductions.
Business Income Tax (Taiwan Profit-Seeking Enterprise Income Tax)
Business Income Tax is filed annually, with the filing deadline on May 31st of each year. Companies can choose from three main methods for filing their business tax declarations:
Paper-Based Tax Declaration Process (擴大書審): This method is suitable for smaller companies with an annual revenue of less than NTD 30 million (some of the business categories threshold under NTD 10 million) and limited accounting staff.
Audit by Reviewing Accounting Books (查帳申報): Recommended for businesses with comprehensive accounting records and an annual revenue exceeding NTD 30 million, this method involves a detailed audit of accounting books conducted by tax authorities.
Filing Returns Assessed and Certified by a Certified Public Accountant (CPA) (會計師查核簽證申報): Companies generating an annual revenue above NTD 100 million can appoint a CPA to verify their financial statements and certify their tax filings
Key Recommendations
Collect Work-Related Fapiaos: Optimize your VAT deductions by ensuring that fapiaos for all eligible business expenses are properly collected and stored.
Choose the Appropriate Declaration Method: Evaluate your company's size, revenue, and accounting capabilities to select the most efficient tax filing method.
By making informed decisions about your tax obligations, you can streamline your financial processes and focus on driving the growth of your business in Taiwan.
Copyright © 2025 by Del Sol CPA Services
Comments