Taiwan’s tax authority has reminded taxpayers to declare Mainland China–sourced income in their consolidated income tax returns, with foreign tax credits allowed within statutory limits. It also warned that undeclared income may attract penalties, though voluntary disclosure before investigation may qualify for relief.
Taiwan’s Taipei National Taxation Bureau of the Ministry of Finance clarified that taxpayers who have obtained income sourced from Mainland China are required to declare and pay income tax together with their individual consolidated income tax return.
The Bureau explained that, according to Article 24, Paragraph 1 of the Act Governing Relations between the People of the Taiwan Area and the Mainland Area, individuals from the Taiwan Area who obtain income sourced from Mainland China must include such income together with Taiwan-sourced income in their consolidated income tax return.
However, any income tax already paid in Mainland China may be credited against the tax payable in Taiwan, but the credit may not exceed the additional tax liability calculated at Taiwan’s applicable tax rates due to the inclusion of the Mainland-sourced income.
The Bureau urged taxpayers who have obtained income sourced from Mainland China but failed to declare it: if they voluntarily file a supplementary declaration and pay the outstanding tax before being reported, investigated by the tax authority, or investigated by personnel designated by the Ministry of Finance, they may, under Article 48-1 of the Tax Collection Act, be exempted from penalties, provided they pay the tax due together with interest.
This announcement was made on 13 May 2026.
