[Taxation] Principles in Determining Remuneration for Services

Ministry of Finance issued Principles in Determining the Income from Sources in the Republic of China (R.O.C) Used in Article 8 of Income Tax Act on Sept 3, 2009. The key points are as follows: I. The term “Remuneration for services rendered within the territory of the R.O.C” used in Paragraph 3, Article 8 of Income Tax Act refers to 1) an individual’s income from salaries and wages, professional practice or other income for services rendered within the territory of R.O.C as an individual; 2) an entity’s remuneration for services under the circumstances as follows: i. All the services are rendered and completed within the territory of the R.O.C; ii. The services can only be completed within and outside the territory of the R.O.C; iii. The services are rendered outside the territory of the R.O.C, but must be completed with participation and assistance by resident or entity residing within the territory of the R.O.C. The participation and assistance refer to providing resources such as equipments, labors, professional knowledge or technique, not including basic background information for service rendered, or any information concerning notice or confirmation. II. Remuneration for services rendered within the territory of the R.O.C include all salaries and wages earned for performing duties or doing works, incomes from professional practice and other subsidiary remuneration or award for service rendered. III. In case an entity renders the service within and outside of the territory of the R.O.C simultaneously, or the service rendered outside of the territory of the R.O.C. can only be completed with participation and assistance by resident or entity residing within the territory of the R.O.C