A Reminder for Enterprises with the Head Office outside the Territory of the R.O.C. on the Income Derived from House and Land Transactions within the Territory of the R.O.C.


  The National Taxation Bureau of the Southern Area, Ministry of Finance indicated that, in order to construct a fair and sound real estate tax system, pursuant to Article 24-5 of the Income Tax Act (hereinafter referred to as “the Act”), from January 1st, 2016, profit-seeking enterprises who have any income derived from transactions of house and land, which are acquired on or after January 1st, 2016, or acquired on or after the following day of 1st January, 2014 and held less than two years, shall have the Income Tax on the Consolidated Income levied on these transactions.

  However, for any profit-seeking enterprise with its head office located outside the territory of the R.O.C., according to Paragraph 3, Article 24-5 of the Act, where the enterprise has a fixed establishment within the territory of the R.O.C., the tax payable shall be calculated separately from other income derived from sources in the R.O.C., and such tax payable shall be included in the enterprise’s income tax return filed by the establishment. Where the enterprise has no fixed establishment within the territory of the R.O.C., its business agent or an entrusted agent shall be responsible for the filing of income tax return and paying the income tax. The tax payable for its income derived from transaction of house and land within the territory of the R.O.C. shall be calculated based on the following tax rates. 
(1) The tax rate shall be 45% for the income derived from the transferred house and land held for a period of no more than 1 year.
(2) The tax rate shall be 35% for the income derived from the transferred house and land held for a period of more than 1 year.

  The Bureau further expressed that, in accordance with Paragraph 4, Article 24-5 of the Act, for any profit-seeking enterprise having its head office located outside the territory of the R.O.C. who directly or indirectly owned more than half of an offshore company’s shares of which at least half of the value of such company is constituted by house and land within the territory of the R.O.C., its income derived from transaction of such offshore company shares shall be calculated and the resultant income tax paid in accordance with the relevant regulation.

  For any inquiries, please call the toll-free number 0800-000-321 for dedicated service. 
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Reference URL:https://www.mof.gov.tw/Eng/singlehtml/f48d641f159a4866b1d31c0916fbcc71?cntId=892c972cff244f2db10d5b608170b14f