Tax Deductible Amount for Company Overseas Income Calculation
For any kind of company having its head office within Taiwan, company income tax shall be levied on its total income derived within or without the territory of Taiwan. Where the income derived from the other country, which would otherwise have been exempted from tax or subject to a limited tax rate in that other country in accordance with the provisions of a DTA (double taxation agreement) , has not been applied for the exemption from or reduction of tax, the overpaid foreign tax on such income may not be claimed to credit against the tax payable in Taiwan.
Tax bureau would like to remind calculations below:
1. Overseas income:
refers to the income obtained from foreign income after deducting the related costs and expenses, rather than counting all foreign income .
2. The amount of foreign tax that can be deducted:
The amount of deduction shall not exceed the amount due to the addition of its foreign income after using the Taiwan tax rate to calculate the increased settlement tax payable.
3. If overseas income is exempt from taxation in another contracting country under a tax treaty or has a ceiling tax rate, the overpaid foreign tax due to the failure to apply the tax treaty shall not be claimed as a deduction.
