Updated Filing Requirements and Transitional Rules
Provisional Income Tax for Profit-Seeking Enterprises
As of September 1, 2026, profit-seeking enterprises in Taiwan must begin filing their provisional income tax returns. Software tools for both filing and payment are available since August 15, 2026. (mof.gov.tw)
Real Property Sales and Loss Offsetting
If your enterprise sells multiple real-estate properties and falls under “separate calculation with consolidated filing” for the Income Tax on House and Land Transactions (real property tax), transaction losses must be first offset against income from house and land transactions taxed at the same rate in the same tax year. This limits cross-use of different rate brackets. (mof.gov.tw)
Holding Period for Inherited Property Extended
Taiwan has expanded the rules on calculating the holding period for property acquired via successive inheritances. The holding period starts from the earliest inheritance, impacting capital gains and potential tax liability in property sales. (mof.gov.tw)
Other Key Compliance Notices
- Individuals or entities making donations to cause-specific relief accounts (e.g. Japan Kumamoto Earthquake) may now treat them as fully deductible as itemized deductions or enterprise charitable contributions. (mof.gov.tw)
- Domestic entities purchasing cross-border electronic services from foreign suppliers are reminded of relevant regulations under Taiwan's Business Tax Act, including withholding or reverse charge obligations. (mof.gov.tw)
Practical Steps
- Enterprises should update accounting systems to distinguish separate categories under real property transactions for loss offsetting.
- Keep detailed records for all inherited properties to trace origin dates; accurate holding periods could substantially alter gains tax outcomes.
- When donating or purchasing cross-border digital services, retain all receipts and verify suppliers comply with Taiwan tax law to avoid unexpected audit issues.
Example Scenario
Suppose a Taiwan company sells two plots of land in 2026 and realizes losses on one parcel. Under the new offsetting rule, those losses can be applied only against income from similar house/land transactions taxed at the same rate—so you could not apply them against business or salary income. This influences investment and divestment timing.
Main Takeaway: With several changes in Taiwan affecting profit-seeking taxpayers—especially in real estate, inheritance, and cross-border services—enterprises should proactively adjust compliance processes to avoid liability and leverage deductions where legitimate.