Tax Registration Required for Businesses Exceeding Invoice Threshold
The Ministry of Finance Taipei National Tax Bureau has stated that business owners should register for tax purposes with the competent tax authority before commencing their business operations. If they operate without completing tax registration and their monthly sales meet the threshold for issuing unified invoices (currently NT$200,000) and are found not to issue certificates to others or fail to obtain purchase certificates, they will be subject to penalties as prescribed by law.
The Bureau explained that business owners who fail to register for tax purposes before operating and whose monthly sales exceed the unified invoice threshold violate Article 44 of the Tax Collection Act and Articles 45 and 51, Paragraph 1, Item 1 of the Value-Added and Non-Value-Added Business Tax Act (hereinafter referred to as the Business Tax Act). They will be subject to heavier penalties under one of the relevant regulations. As for failing to obtain the required purchase certificates, penalties will be imposed according to Article 44 of the Tax Collection Act.
The Bureau provided an example: Mr. A was caught for the first time within a year for operating without proper tax registration. He made purchases totaling 2 million from Company B without obtaining the proper purchase certificates and failed to issue the required unified invoices during sales. He also underreported 4 million in sales. Upon investigation, in addition to the 200,000 in taxes to be paid, he was penalized according to Articles 45 and 51 of the Business Tax Act and Article 44 of the Tax Collection Act. The failure to obtain the required purchase certificates for the 2 million in purchases was penalized with a 2% fine on the total amount.
The Bureau specifically reminded business owners that they must complete tax registration before starting business operations. Additionally, failing to issue a unified invoice during sales or failing to obtain proper purchase certificates are considered two separate violations and will be penalized accordingly. Business owners should carefully comply with regulations to avoid penalties.
