Change of Sole Proprietorship Responsible Person Requires Invoice and Tax for Asset Transfer

• Change of responsible person in a sole proprietorship is considered a sale of goods when transferring inventory or fixed assets to the new person.
• The original responsible person must issue an invoice and pay business tax on the transfer.
• Sole proprietorships are not legal entities; they operate under the name of the business but are personal enterprises.
• When the responsible person changes, it is essentially a transfer of rights and obligations.
• Regardless of whether compensation is received, the transfer is treated as a sale of goods.
• The original responsible person must issue an invoice at the market value at the time of transfer and pay business tax.
• Example: In a sole proprietorship, the original responsible person transfers business rights and assets worth 1.2 million NTD to a new person.
• The original person must issue an invoice for 1.2 million NTD and a tax amount of 60,000 NTD.
• The new person can use the invoice to declare and offset the sales tax of the business.

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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