Regulations Governing Application of the Place of Effective Management Article 7

In the case of a foreign profit-seeking enterprise under Article 43-4 of the Income Tax Act, the responsible person appointed pursuant to the preceding three articles shall file for provisional payment, tax return, undistributed earnings, and income basic tax, and shall settle the tax payment from the date following the filing date, registration date, or the end of the prescribed time limit.Where the business operation period from the date following the filing date, registration date, or the end of the prescribed time limit to the last date of the fiscal year is less than one year, the amount of income derived from such period shall first be converted into corresponding annual income according to the proportion of the length of the period to the year, and the amount of income tax shall then be determined by the tax rate applicable to such annual income but paid based on the original proportion for the period in which business is actually operated. Where the business operation period is less than one month, it shall be taken as one month.Where the foreign profit-seeking enterprise in the first paragraph fails to file for provisional payment, tax return, undistributed earnings, income basic tax, and fails to settle the tax payment, the tax authorities shall make assessments of the provisional payment, income amount, undistributed earnings, income basic tax, and payable tax amount of such foreign profit-seeking enterprise, with the assessment notice and tax demand notice, and serve them to the responsible person under the preceding three articles to pay within the prescribed time limit .Where the foreign profit-seeking enterprise in the first paragraph has an income derived from sources in the Republic of China from the date following its filing date, registration date, or the end of the prescribed time limit, it shall present to its tax withholder or payer the approval （recognition）letter of the tax authorities evidencing its eligibility under Article 43-4 of the Income Tax Act, and the tax withholder or payer shall withhold income tax, submit and issue the withholding (exemption) certificates, dividend vouchers and relevant certificates in accordance with the provisions concerning making payments to a domestic profit-seeking enterprise in the Income Tax Act. Where, pursuant to Paragraph 1, Article 16, Paragraph 4, Article 22-7, and Paragraph 4, Article 22-16 of the Offshore Banking Act, the interest, income derived from the transaction of structured products, and insurance payments paid by an offshore banking unit, offshore securities unit, or offshore insurance unit to the foreign profit-seeking enterprise is exempt from income tax withholding, the foreign profit-seeking enterprise shall act in compliance with the first paragraph.