Taiwan Clarifies Business Tax on Compensation and Penalty Fees from Sales of Goods or Services

• Compensation or penalty fees arising from the sale of goods or services in Taiwan must be invoiced and reported for business tax under the Business Tax Act.
• These fees are considered part of the total sales amount and are subject to business tax if they are related to the sale of goods or services.
• If such fees are not related to sales activities, they are not subject to business tax.
• Failure to report these fees can result in additional tax assessments and fines, but voluntary correction before investigation may exempt taxpayers from fines, though interest may apply.

Source: regfollower.com

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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