What You Need to Know: Amended Withholding Rules and Revised Income Tax Act on Withholding
To enhance the protection of the rights and interests for tax withholders, and optimize the income tax withholding rules, the Ministry of Finance proposed a draft amendment to certain articles of the Income Tax Act. After the third reading in the Legislative Yuan, the amendment was promulgated by the President on August 7, 2024. According to Paragraph 2, Article 126 of the said Act, the effective date of the amended provisions has been approved to be January 1, 2025 by the Executive Yuan at the request of the Ministry of Finance. The National Taxation Bureau of the Southern Area, Ministry of Finance (hereinafter “the Bureau”) has summarized the amendments and explained as follows:
1. To avoid excessive accountability of the responsible person and the head of the unit responsible for tax withholding, the existing tax withholders (the responsible person of the enterprises making income payments, or the head of the unit responsible for the tax withholding in charge of the relevant organizations or institutions) will be amended to the units themselves, such as the enterprises, organizations, or institutions paying the income.
2. To alleviate the operational burden during consecutive holidays, the deadline for withholding tax payment, filing of withholding tax statements, and issuance for non-residents or foreign profit-seeking enterprises without a fixed place of business or business agent within the R.O.C. receiving income, will be extended by 5 days when there are 3 consecutive national holidays. The extension follows the rules of residents and profit-seeking enterprises with a fixed place of business or business agent within the R.O.C..
3. To protect the rights and interests of tax withholders, the tax authorities are given discretionary power to impose penalties within the prescribed upper and lower amounts based on the severity of violations or the degree of culpability. Penalties will no longer be uniformly imposed based on fixed amounts or ratios.
The Bureau would like to remind tax withholders that the effective date of the amended provisions of the Income Tax Act is January 1, 2025. Tax withholders are urged to thoroughly understand the revised regulations and comply with the withholding procedures by the said Act.
For any inquiries, please call our toll-free number 0800-000-321. It is our pleasure to serve you.
Press Release Contact: Ms. Lin
Individual Income, Estate And Gift Tax Division
TEL: 06-2223111 ext.8065
Reference URL：https://www.mof.gov.tw/Eng/singlehtml/f48d641f159a4866b1d31c0916fbcc71?cntId=a77fc2e5ccd542cd9f9178a325131846