萬國法律事務所

According to the proposal of the MOF and MOE, the business may apply for tax benefits with the following options in the future:

(1) A company may credit up to fifteen (15) percent of the company’s total expenditure on R&D against its business income tax payable for that year; nevertheless, this credit may not exceed thirty (30) percent of the business income tax payable by the company in that year(current tax benefits); or

(2) A company may credit up to ten (10) percent of the company’s total expenditure on R&D against its business income tax payable in each year within a period of three (3) years from the year of the expenditure; nevertheless, this credit shall not exceed thirty (30) percent of the business income tax payable by the company of each year during the foregoing period.(new options)

Based on the analysis of the MOF, the current statute favors more medium and small businesses with lower amount of R&D investment. In contrast, the prospective amendment to the Act for Industrial Innovation is expected to benefit big enterprises with more spending on R&D investment. In addition, the cap of NTD ten (10) billion applying to the total amount of the deduction of all the industries for each fiscal year may be lifted accordingly.