|
In anticipation of the abolishment of the Statute for Upgrading Industries on December 31, 2009, the Legislative Yuan proposed certain amendments to the Income Tax Act. These amendments were promulgated on May 1, 2009, and include the following major amendments:
|
|
|
|
|
|
|
l |
Reduced corporate income tax rate
|
|
|
|
|
|
|
|
Starting from year 2010, corporate income tax rate will be a flat 20% instead of 25%, and the threshold for taxation will be NT$120,000 instead of NT$50,000.
|
|
|
|
|
|
|
l |
Reduced individual income tax rate
|
|
|
|
|
|
|
|
Starting from year 2010, the three lowest individual income tax rates will be "5%, 12%, 20%" instead of "6%, 13%, 21%" and the threshold for taxation at 5% will be NT$500,000, instead of NT$410,000.
|
|
|
|
|
|
|
l |
Simplified procedure for declaration of provisional payment
|
|
|
|
|
|
|
|
Starting from the filing of income tax return for year 2009, if a profit-seeking enterprise pays provisional business income tax at half of the income tax payable of the previous year, it need not file a provisional business income tax return with the tax authorities.
|
|
|
|
|
|
|
l |
Simplified procedure for declaration of income by sole proprietorships and partnerships
|
|
|
|
|
|
|
|
Starting from year 2009, sole proprietorships and partnerships only need to file business income tax return without paying corporate income tax, while their income should be consolidated into their individual income tax returns and be subject to individual income tax accordingly.
|
|
|
|
|
|
|
l |
Simplified application process for asset evaluation and reduced differences between financial accounting principles and income tax laws
|
|
|
|
|
|
|
|
The methods prescribed under the income tax laws for the evaluation of assets and the calculation of depreciation of fixed assets are now in line with those prescribed under the financial accounting principles. The requirement to apply for the tax authorities' prior approval for changing the method of evaluating assets or calculating the depreciation of fixed assets has been abolished. The provision under the income tax laws on the amortization of business start-up expenses has been deleted while a provision on treating such expenses as current expenses has been added.
|
|
|
|
|
|
|
l |
Amend the penalty multiplier
|
|
|
|
|
|
|
|
The tax authorities have the discretion to decide on the penalty for violation of tax-withholding obligation, underpayment of income tax and failure to report income, and so on.
|
