Delivers Goods to Bonded Areas per Customer’s Instructions, Zero-Rate VAT May Apply
A business may apply the zero-business-tax rate for transactions involving orders from foreign customers with goods delivered to bonded area operators as instructed by those customers.
Following is the Example Explanations:
- Company A received an order for goods worth NTD6 million from foreign customer B. Following B’s instructions, the goods were delivered to Bonded Area Company C in September 2024, with customs clearance and an export declaration completed. Company A may declare the NTD6 million sales amount with supporting documents as eligible for the zero-tax rate during the delivery period.
- Company A also received an order for goods worth NTD5 million from foreign customer D. Following D’s instructions, the goods were delivered to Bonded Area Company E in September 2024 without customs clearance. Company A received foreign exchange income from customer D in early November 2024. Company A must include the NTD5 million sales amount in its November–December 2024 VAT filing and submit customer D’s purchase order, Company E’s receipt, proof of foreign exchange income, and other supporting documents to declare the zero tax rate.