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.