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財政部賦稅署-法規查詢主題專區

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法律與法規命令

Tax Act:
Regulations Governing Assessment of Interest Expenditure on the Debts Owed by a Profit-seeking Enterprise to a Related Party in Accordance with the Condition that the Related Payments Shall Not be Considered as Expenses or Losses
Article 3
Content:
(Definition of Related Parties)
The term "Related Parties" referred to in the Regulations shall include "Affiliated Enterprises" and “Related Parties other than Affiliated Enterprises”.
The “Affiliated Enterprises” as referred to in the preceding paragraph means a profit-seeking enterprise has an affiliated relationship with, or is owned or controlled by other domestic or foreign profit-seeking enterprises as follows:
1. A profit-seeking enterprise directly or indirectly holds 20% or more of the total outstanding voting shares or capital stock in another profit-seeking enterprise;
2. 20% or more of the total outstanding voting shares or capital stock in a profit-seeking enterprise and another profit-seeking enterprise are directly or indirectly owned or controlled by the same person; 
3. A profit-seeking enterprise holds the highest percentage of the total outstanding voting shares or capital stock in another profit-seeking enterprise and such percentage is 10% or more; 
4. One half or more of the executive shareholders or directors of a profit-seeking enterprise and those of another profit-seeking enterprise are the same;
5. The aggregate number of directors appointed by one profit-seeking enterprise and by the other enterprise(s) in which it directly or indirectly holds 50% or more of the total outstanding voting shares or capital stock, reaches one half or more of the total number of directors of another profit-seeking enterprise; 
6. The chairman, general manager or its equivalent or superior of one profit-seeking enterprise is that of another profit-seeking enterprise, or has the relation of a spouse or blood relation within the second degree with that of another profit-seeking enterprise; 
7. In the case where the head office of a profit-seeking enterprise is located outside the territory of the Republic of China (hereinafter referred to as the "ROC"), its branch office within the territory of the ROC and its head office or branch offices outside the territory of the ROC are related parties. In the case where the head office of a profit-seeking enterprise is within the territory of the ROC, the head office or branch office within the territory of the ROC and its branch offices outside the territory of the ROC are related parties;
8. A profit-seeking enterprise directly or indirectly controls the personnel, finance, or business operation of another profit-seeking enterprise, including situations where:
(1)The enterprise appoints the general manager or its equivalent or superior of another profit-seeking enterprise;
(2)The enterprise that is not a financial institution lends money or guarantees the loans to another profit-seeking enterprise to an amount representing 1/3 or more of its total assets; 
(3)The profit-seeking enterprise cannot commence its production and business activities without the provision by another profit-seeking enterprise of patent, trademark, copyright, secret formula, proprietary technology or any franchises,in which the underlined sales of such production and business activities account for 50% or more of the total sales of the former profit-seeking enterprise in the same year;
(4)The price and terms of the profit-seeking enterprise's purchase of raw materials, components and goods are controlled by another profit-seeking enterprise; and the underlined purchase of such raw materials and goods accounts for 50% or more of the total purchase of raw materials and goods of the former profit-seeking enterprise in the same year; 
(5)The sales of products of the profit-seeking enterprise are controlled by another profit-seeking enterprise, and the underlined sales of such products account for 50% or more of the total sales of the former profit-seeking enterprise.
9. A profit-seeking enterprise and another profit-seeking enterprise have entered into a joint venture agreement, or an agreement to conduct business jointly;
10. Other circumstances whereby a profit-seeking enterprise has control or major influence over the personnel, finance, business operation or management decisions of another profit-seeking enterprise.
In the event that the relationship between two profit-seeking enterprises, due to special market or economic conditions, satisfies the criteria prescribed in Items 3 to 5, Subparagraph 8, in the preceding paragraph hereinabove, and nevertheless do not have de facto controlling or subordination relationships, except where the relationship between or among a profit-seeking enterprise and government-owned enterprises, sales agents, distributors or monopolistic enterprises subject to Article 5 of the Fair Trade Act may be deemed as without having a subordinate or control relationship with respect to each other, the profit-seeking enterprise may, prior to filing its annual income tax returns, produce sufficient evidentiary documents to the tax collection authorities for ratification. Once the documents provided have been ratified, the affiliated relationship set forth in the preceding paragraph shall not apply.
The “Related Parties other than Affiliated Enterprises” as referred to in the first paragraph means a profit-seeking enterprise has an affiliated relationship with other local or foreign individuals, profit-seeking enterprises, educational, cultural, public welfare, charity organizations or institutions as follows:
1. A profit-seeking enterprise and a foundation receiving the donation from the enterprise in the amount representing 1/3 or more of the total funds of such foundation;
2. A profit-seeking enterprise and its directors, supervisors, general manager or its equivalent or superior, vice-general managers, assistant general managers and department heads under the direct supervision of the general manager; 
3. A profit-seeking enterprise and the spouses of its directors, supervisors, general manger or its equivalent or superior;
4. A profit-seeking enterprise and the relatives of its chairman of the board, or general manager or its equivalent and superior within the second degree of blood relation;
5. A profit-seeking enterprise and the persons who evidentially have the power of control over the enterprise or have the ability to exert major influence over the personnel, financial, business operation or management policy of the enterprise.
Visitor:2  Update:2018-06-04

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