Taiwan VAT System – Complete Guide

📘 What is VAT in Taiwan?

Taiwan operates a Value-Added Tax (VAT) system known locally as the Business Tax (BT). It is imposed on the sale of goods and services, as well as on imports. The system is regulated by the Ministry of Finance (MOF) and administered through the National Taxation Bureau.

There are two main types of business tax in Taiwan:

• Value-Added Tax (VAT): Applied to most goods and services
• Gross Business Receipts Tax (GBRT): Applied to certain industries (e.g. financial, insurance, small businesses)

This article focuses on VAT under the general tax regime.

📊 VAT Rates in Taiwan

As of 2025, Taiwan’s VAT rates are as follows:

🔹 Standard Rate: 5%

Applied to most goods and services, including imports.

🟢 Zero-Rated Supplies:

• Exported goods
• International transportation
• Services provided to foreign customers (under certain conditions)
• Offshore electronic services provided by non-resident suppliers

🚫 VAT-Exempt Supplies (under GBRT):

• Financial services (e.g. banking, insurance)
• Educational and cultural services
• Healthcare services
• Real estate leasing
• Small businesses below turnover threshold

🏢 VAT Registration in Taiwan

✅ Who Must Register?

• All businesses engaged in taxable transactions within Taiwan
• Foreign suppliers of digital services to Taiwan-based consumers must also register under the Non-Resident VAT Scheme

📝 Registration Process:

• Apply to the National Taxation Bureau (NTB)
• Submit business registration certificate, tax ID, and relevant documents
• Receive a VAT registration number
• Start issuing uniform invoices and filing VAT returns

🧾 VAT Invoice (Uniform Invoice) Requirements

Taiwan mandates the use of Uniform Invoices, which are standardized VAT receipts required for all taxable transactions.

Required details include:

• Seller and buyer name, address, tax ID
• Uniform Invoice number and date
• Description of goods/services
• Quantity, unit price, net amount
• VAT amount (5%)
• Total amount payable

Most businesses must use e-invoicing (electronic uniform invoices) through government-authorized platforms.

📅 VAT Filing & Payment in Taiwan

⏳ Filing Frequency:

Bi-monthly filing is standard for most VAT-registered entities:

• Jan–Feb, Mar–Apr, May–Jun, Jul–Aug, Sep–Oct, Nov–Dec

Large taxpayers may file monthly upon approval

📤 Filing Process:

• File returns via the E-Tax Portal
• Report taxable sales, input tax, exempt/zero-rated sales
• Submit electronic invoice data
• Claim input VAT deductions

💸 Payment Due Dates:

• VAT returns and payments are due by the 15th of the month following each tax period.

🌍 VAT on Imports & Digital Services

• Imports: VAT (5%) is collected at the point of customs clearance
• Foreign digital service providers (e.g., streaming, SaaS) must register, collect, and remit VAT on B2C supplies in Taiwan

📌 Since 2017, Taiwan has required non-resident suppliers to register and file VAT returns for digital services.

🧮 VAT Calculation Example

Scenario: A company in Taiwan sells electronics worth TWD 200,000

• Output VAT = 5% of 200,000 = TWD 10,000
• Total invoice = TWD 210,000
• If input VAT = TWD 3,000
• Net VAT payable = TWD 7,000

🚫 VAT Exemptions in Detail

Some goods and services are exempt from VAT and instead subject to the Gross Business Receipts Tax (GBRT):

• Financial and insurance services
• Medical and health care services
• Education, academic and cultural institutions
• Land transactions and residential leasing
• Services provided by small-scale businesses

❗Note: Input VAT cannot be claimed for exempt transactions.

✅ Compliance Tips for Businesses

• ✔️ Use approved electronic invoicing systems
• ✔️ File VAT returns accurately and on time (every 2 months)
• ✔️ Keep digital records of all transactions for at least 5 years
• ✔️ Clearly classify zero-rated and exempt sales
• ✔️ Foreign service providers must register separately

📌 Conclusion

Taiwan’s VAT system offers a simple flat rate of 5%, with mandatory uniform invoicing and a strong push toward digital compliance. Whether you’re a domestic seller or an overseas digital service provider, it’s critical to understand your VAT responsibilities and meet all regulatory obligations.

👉 Use our Taiwan VAT Calculator at gstcal.org to accurately compute VAT and streamline your filings.