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Taiwan reduces Imputation Tax Credit to 50%

Taiwan reduces Imputation Tax Credit to 50%

TAIPIE: To boost revenue, the National Taxation Bureau of Taipei (NTBT) began implementing from 2015, the approved measure that halves the benefit of the full dividend imputation system previously allowed in Taiwan.

The full dividend imputation system had allowed for tax on corporate profits to be offset against individual tax liability arising from the receipt by individual resident shareholders of a dividend from that company. This system has now been replaced by a 50 percent tax credit instead.

The NTBT has further interpreted the new measure to mean that the halved imputation tax credit should also be allowed for distributed dividends or earnings paid to shareholders who are not resident in Taiwan.