Remuneration Paid to Foreign Entity must be Withheld at Source

A 20% withholding tax must be levied on remuneration for technical services paid by entity in Taiwan to entity without fixed place of business in Taiwan in accordance with Article 88 of Income Tax Act and Article 3 of The Standards of Withholding Rates for Various Incomes. In case the technician is employee of foreign entity, the allowance of business travel shall be expense of foreign entity. Even if it is agreed that the allowance of air ticket and business travel shall be paid by entity in Taiwan, the allowance must be regarded as part of payment due under the agreement which shall be taxed together with remuneration for technical services according to aforesaid laws.