The National Taxation Bureau of Taipei (hereinafter referred to as NTBT), Ministry of Finance (hereinafter referred to as MOF) stated that taxpayers with multiple citizenship living in the Republic of China (hereinafter referred to as R.O.C.) shall file their R.O.C. source incomes derived from their services rendered in the R.O.C. altogether no matter where the said income derived from.
The NTBT said that in accordance with the provisions of Article 7 of the Income Tax Act, residents of the R.O.C. are referred to (1) those who have domiciles in the territory of the R.O.C. and often reside in the territory of the R.O.C.; or (2) those who have no domiciles in the territory of the R.O.C., but stay in the territory of the R.O.C. for 183 days or more within one taxable year. In addition, according to Decree No. 10104610410 issued by MOF on September 27, 2012, residents of the R.O.C. are referred to (1) those who have household registrations in the territory of the R.O.C. and stay in the territory of the R.O.C. for at least 31 days within one taxable year; or (2) those who stay in the territory of the R.O.C. for more than one day but less than 31 days within one taxation year and with core economic and living activities in the territory of the R.O.C..
The NTBT further expressed that the status of resident is not verified by the R.O.C. citizenship in accordance with the Income Tax Act. Actually, the remuneration derived from domestic or overseas companies for the services rendered in the territory of the R.O.C. is R.O.C. source income. Taxpayers shall file the said remuneration received in the previous year altogether every May in accordance with the relevant laws and regulations.
Taking individual A as an example: A is a person with citizenship of R.O.C. and country B. A was employed by domestic company C as General Manager and by company D, a Taiwanese subsidiary of foreign company E, as a consultant. Company C and D filed withholding tax statements in terms of A’s R.O.C. ID number and ARC number respectively. However, A only filed income received from company C and failed to file income received from company D while filing 2018 individual income tax return. Eventually, A was subject to additional tax payment and penalty associated with under-reporting.
The NTBT reminds that the residents of the territory of the R.O.C. who are with multiple citizenship shall file R.O.C. source income altogether no matter they got paid by which identities. Furthermore, to avoid tax violation and punishment, the said residents shall not file their individual income tax returns in different citizenship at the same time.
(Contact: Ms Huang, Section Head of the Second Legal Affairs Division; Tel: 886-2-2311-3711 ext. 1961)
