Taiwan’s tax authority reminded enterprises they have to apply for extensions before deadlines to submit CFC financial statements.
The Northern Taiwan National Taxation Bureau of the Ministry of Finance stated that, in line with international anti-tax avoidance trends and to maintain tax fairness, Taiwan’s Controlled Foreign Corporation (CFC) regime has been implemented starting from fiscal year 2023.
When profit-seeking enterprises file their 2024 income tax returns, if they fall within the scope of the CFC rules (including those meeting exemption criteria), they must disclose relevant information in the prescribed format and attach CFC financial statements or other supporting documents verified and certified by a CPA.
If enterprises are unable to submit the CFC financial statements within the prescribed deadline, they must apply to the tax authority for an extension before the end of the income tax filing period (30 June 2025). The extension may not exceed six months and may only be granted once.
The Bureau further explained that enterprises using the calendar year system may apply directly to the tax authority for an extension before the filing deadline and receive an official approval letter. Alternatively, they may apply for an extension to submit the CFC financial statements by 31 December 2025, together with their 2024 income tax return. For those approved by the tax authority, the approval letter has been replaced by a public announcement issued on 30 July 2025, which is deemed legally delivered from the date of announcement.
The Bureau specifically reminded enterprises that if they apply for an extension to submit CFC financial statements by 31 December 2025, they must comply with the deadline. Only then may they elect to defer recognition of gains or losses from the valuation of “financial instruments measured at fair value through profit or loss (FVPL)” held by the CFC until realisation, at which point such gains or losses will be included in the CFC’s earnings for that year. Losses of a CFC, once approved by the tax authority, may be carried forward and deducted from the CFC’s earnings in subsequent years within a 10-year period starting from the year following the loss.
This announcement was made on 19 December 2025.
