- Franchisors that charge a one-time franchise fee must issue a uniform invoice and pay business tax.
- If the fee includes equipment or raw materials, it is treated as both goods and services, and still requires invoicing and tax reporting.
- Taiwan tax authorities define transferring goods as “sale of goods” and providing brand rights, training, or related services as “sale of services.”
- A case example showed a coffee franchise operator failed to issue invoices for over NT$7 million in franchise fees and was back-taxed and penalized.
- If missed invoices and sales are voluntarily reported and taxes paid before any investigation begins, penalties may be waived.
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.
