- Businesses must issue uniform invoices and pay business tax on compensation or penalty fees received due to the sale of goods or services.
- Compensation or penalty fees related to sales are included in taxable sales amounts under the Business Tax Act.
- If such fees are not related to the sale of goods or services, they are not subject to business tax.
- Example: Penalty fees for late rent payments are taxable and must be invoiced and reported.
- Businesses that underreport such amounts can avoid penalties by voluntarily correcting and paying the tax before investigation.
Source: mof.gov.tw
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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