Page 37 - 2024 BRAVO! TAIWAN_en

Type Explanation

A tourism enterprise with a corporate organization may claim 10% - 20% of international tourismpromotion
expenditures as a deduction against payable business income tax for the current year. Unused deduction amounts
Tourism Industry
can be claimed within a period of four years; however, the amount may not exceed 50% of the current year's total
business income tax payable (the amount deductible in the final year is not subject to this restriction).

Royalties paid to foreign enterprises for patent rights, trademark rights, or franchise rights owned by overseas
Deductibility of Paid profit-seeking enterprises for new production technologies, or imported products approved by the competent
Foreign Royalties
authority to improve product quality or reduce production costs, shall be exempt from income tax. Advantageous Environment

A joint stock limited liability company investing in satellite town development may claim up to 20% of total
investment as a deduction against business income tax payable on development income for the current year.

When a company limited by shares invests in a designated applicable tax-incentive zone and engages in an
industry facilitating satellite town development, the company may claim up to 20% of the total amount of actual
Development of New purchases of new machinery, equipment, and buildings used for business purposes in accordance with the
Towns
company's investment plan after beginning operation as a deduction against payable business income tax for the
current year.

Limited liability companies investing in the construction of new towns are exempt from land value tax during the
period of construction.

When urban renewal enterprises organized as joint-stock companies invest in urban renewal undertakings
designated or changed to areas requiring urban renewal by the competent authority, such enterprises may receive
a tax credit of up to 20% of their total investment against their payable profit-seeking enterprise income tax in the
year the urban renewal project is completed; when the enterprise's profit-seeking enterprise income tax during
that year is insufficient for the tax credit, it may take the credit during the subsequent 4 years. The total amount of
the tax credit in any one year may not exceed 50% of payable profit-seeking enterprise income tax for that year;
however, the credit during the final year shall not be subject to this restriction.
Urban Renewal

When the competent authority or other agency (organization) that has received the competent authority's consent
performs urban renewal work itself in accordance with the Urban Renewal Act, if a joint-stock company assists
in the implementation of the urban renewal project and has been selected through an open bidding process, that
company may apply the foregoing investment tax credit regulations to its urban renewal project implementation
expenditures within the division of powers and responsibilities and content of the urban renewal project explicitly
stated in the urban renewal plan or rights change plan.

Tax Incentives for Imports of specific goods that comply with the additional requirements of Customs Import Tariffs, such as quartz
Importing Specific glass for the semiconductor industry, which have obtained certification from the competent authority, are eligible
Goods for preferential import tariffs.

Company employees who receive equity-based compensation (issuance of shares as compensation, employee
capital increase subscriptions, repurchased treasury stock redistributed to employees, and employee stock option
certificates, as well as new restricted employee stock awards), may, for a value of up to NT$ 5 million, calculated
Stock-Based based on the value in the year in which the shares were received, opt to defer taxation until the actual transfer of
Employee the stock, at which point the taxable income will be calculated based on the transfer price.
Compensation
In addition, if such employees hold such shares and continue to work at the company for more than two years
from the day on which the shares were acquired, tax may be calculated on the lower of market value at time of
acquisition or actual transfer price of the stock.

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