According to the Act, a foreign company engaged in international transport involving Taiwan, in construction contracting, providing technical services, or leasing machinery / equipment and the costs / expenses are difficult to calculate, regardless whether or not it has a branch office or business agent in Taiwan, may apply for approval to consider 10% or 15% of its total business revenue as its income derived within Taiwan. And the resulting gross withholding rate will become 2% or 3% (=assessed profit rate at 10% or 15% * regular withholding rate at 20%).
|Type||Deemed Profit Rate (a)||Tax Rate (b)||Withholding Rate (c=a*b)|
|International transport involving Taiwan||10%||20%||2%|
|Providing technical services||15%||20%||3%|
|Leasing machinery / equipment||15%||20%||3%|
The case will be submitted to the National Taxation Bureau of the area, and it generally takes 2-4 weeks to address the issues.
Usually only the contract will be assessed, and the evidence of service provision is not required.