Currently, Taiwan has an “Agreement for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income” with 32 countries. Taxpaying residents of Taiwan’s treaty-partner countries should not be taxed by both tax jurisdictions and may apply for approval to reduce the withholding tax on their Taiwan-based dividends, interest, royalties, capital gains, business profits, entertainers / athletes, etc.
Reduced Rates
| Treaty Partner | Effective Year | Dividends | Interest | Royalties | Business Profits |
|---|---|---|---|---|---|
| Australia | 1996 | 10%, 15% | 10% | 12.5% | Exempt |
| Austria | 2014 | 10% | 10% | 10% | Exempt |
| Belgium | 2005 | 10% | 10% | 10% | Exempt |
| Canada | 2015 | 13%, 15% | 10% | 10% | Exempt |
| Denmark | 2005 | 10% | 10% | 10% | Exempt |
| France | 2011 | 10% | 10% | 10% | Exempt |
| Gambia | 1998 | 10% | 10% | 10% | Exempt |
| Germany | 2012 | 10%, 15% | 10%, 15% | 10% | Exempt |
| Hungary | 2010 | 10% | 10% | 10% | Exempt |
| India | 2011 | 12.5% | 10% | 10% | Exempt |
| Indonesia | 1996 | 10% | 10% | 10% | Exempt |
| Israel | 2009 | 10% | 7%, 10% | 10% | Exempt |
| Italy | 2015 | 10% | 10% | 10% | Exempt |
| Japan | 2015 | 10% | 10% | 10% | Exempt |
| Kiribati | 2014 | 10% | 10% | 10% | Exempt |
| Luxembourg | 2014 | 10%, 15% | 10%, 15% | 10% | Exempt |
| Malaysia | 1999 | 12.5% | 10% | 10% | Exempt |
| North Macedonia | 1999 | 10% | 10% | 10% | Exempt |
| New Zealand | 1997 | 15% | 10% | 10% | Exempt |
| Netherlands | 2001 | 10% | 10% | 10% | Exempt |
| Paraguay | 2010 | 5% | 10% | 10% | Exempt |
| Poland | 2015 | 10% | 10% | 3%, 10% | Exempt |
| Senegal | 2004 | 10% | 15% | 12.5% | Exempt |
| Singapore | 1982 | 40% | Not Available | 15% | Exempt |
| Slovakia | 2011 | 10% | 10% | 5%, 10% | Exempt |
| South Africa | 1996 | 5%, 15% | 10% | 10% | Exempt |
| Eswatini | 1999 | 10% | 10% | 10% | Exempt |
| Sweden | 2004 | 10% | 10% | 10% | Exempt |
| Switzerland | 2011 | 10%, 15% | 10% | 10% | Exempt |
| Thailand | 2012 | 5%, 10% | 10%, 15% | 10% | Exempt |
| UK | 2002 | 10% | 10% | 10% | Exempt |
| Vietnam | 1998 | 15% | 10% | 15% | Exempt |
Requirements
To apply for the treaty rates,
| Condition | Requirements |
|---|---|
| Organization | No limitation. |
| Nationality | The applicant must be a taxpaying resident in a country with treaty partnership respecting Taiwan. |
| Permanent Establishment | If a foreign company conducts business in Taiwan through a permanent establishment in Taiwan, the profits attributable to that establishment may be taxed by the Taiwan government. |
| Business in Taiwan | Business profits, income from real estate, shipping and air transport, dividends, interest, royalties, capital gains, etc. |
| Royalties | If business profits include royalties, the royalties should be separated and treated differently from the business profits. |
| Industry | No limitation. |
| Technical Depth | No limitation. |
| Effects | No limitation. |
| Related-party Transaction | If the payer and payee are related in any other way, additional to the transaction itself, the pricing and necessity will be assessed carefully. |
| Cost calculation | Not limited. |
| Deadline | The application should be submitted within 5 years after the payment takes place. |
Procedures
The case will be submiited to the area’s Tax Bureau, and it generally takes 8-12 weeks to address the issues.
Assessment
Both the contract and the evidence of service provision will be required.