Profit-seeking enterprises mainly engaged in securities investment must report both securities sales and investment income as operating revenue and allocate related expenses when calculating tax-exempt income, the Central Area National Taxation Bureau has said.
Taiwan’s Central Area National Taxation Bureau of the Ministry of Finance has said that profit-seeking enterprises whose primary business is investing in marketable securities must classify income from the sale of securities and investment income from securities investments as operating revenue.
This applies when they file the annual profit-seeking enterprise income tax return and calculate annual taxable income, the bureau said in a release on 23 October 2026.
The bureau said that if an enterprise has securities transaction gains exempt from income tax under Article 4-1 of the Income Tax Act, or investment income exempt under Article 42 of the same Act, it must report these separately as deductions from annual income. It must first allocate the related operating expenses and interest expenses against the securities transaction gains and the net investment income.
The amounts must be reported under:
- Box 99: Securities and futures transaction gains (losses) exempt from income tax; and
- Box 58: Tax-exempt investment income.
The bureau said that only by doing so can an enterprise correctly calculate its taxable income. It added that the allocation must follow the Regulations Governing the Allocation of Costs, Expenses, and Losses Relating to Tax-Exempt Income of Profit-Seeking Enterprises.
Filing guidance
The bureau reminded taxpayers that detailed instructions on the filing requirements for enterprises primarily engaged in securities investment are available on the Ministry of Finance’s Electronic Tax Filing Service website, under the Profit-Seeking Enterprise Income Tax Electronic Filing System. The instructions are also included in the Profit-Seeking Enterprise Income Tax Return forms.
