Taiwan’s National Taxation Bureau of the Northern Area reminded profit-seeking enterprises to report overseas investment income in their annual tax returns, warning that omissions could result in additional tax liabilities and penalties.
Taiwan’s National Taxation Bureau of the Northern Area (NTBNA), Ministry of Finance (MOF), has reminded profit-seeking enterprises to include overseas income from offshore financial investments in their taxable income. Under Paragraph 2, Article 3 of the Income Tax Act, such income must be combined with domestic income when calculating profit-seeking enterprise income tax.
The Bureau explained that profit-seeking enterprises with head offices within the territory of the Republic of China (R.O.C.) are liable for profit-seeking enterprise income tax on their total income derived from sources both within and outside the R.O.C. Accordingly, overseas income earned from investments in offshore financial products must be included in the enterprise’s income for the relevant tax year.
Types of overseas income subject to reporting
The reporting requirement covers various types of overseas income from offshore financial investments that are not subject to withholding. These include overseas profit income, such as dividends received from offshore funds, and overseas interest income, including distributions from offshore bond funds.
Income from property transactions must also be reported. For example, gains arising from the disposal of offshore funds must be included in the profit-seeking enterprise’s income for the current year.
The NTBNA also cautioned that overseas income is not included in the income information provided by tax authorities for taxpayers to check. Consequently, businesses should independently review their financial records and tax returns to ensure that all relevant overseas income has been declared.
Voluntary disclosure of under-reported income
The Bureau advised enterprises that discover unreported overseas income to take corrective action before the tax authorities initiate an investigation or an informant brings a case forward.
Under Article 48-1 of the Tax Collection Act, a company that voluntarily identifies an under-reporting of overseas income may file a supplementary tax return and pay the outstanding tax to its local national taxation bureau. This must be completed before a case is brought forward by an informant or an investigation is initiated by the tax authorities.
The NTBNA urged profit-seeking enterprises to verify that their overseas investment income has been properly reported to avoid additional tax assessments and penalties.
This announcement was made on 16 October 2026.
