Common types of income under-reporting and omissions in income tax returns for profit-making businesses

The Taipei National Taxation Bureau of the Ministry of Finance stated that the 2013 corporate income tax settlement and declaration period is from May 1 to May 31, 2014. Unless otherwise provided by law, all relevant income of profit-making enterprises should be included in the corporate income tax declaration to avoid penalties.

The bureau explained that some profit-making businesses often under-report or miss-report income due to misunderstanding of laws or negligence. In order to prevent profit-making businesses from being penalized for under-reporting income, the bureau specifically listed the following types of income under-reporting that often occur, reminding profit-making businesses to pay attention to the relevant reporting regulations and not to miss any of them:
1. Income from subsidies from governments at all levels (except those exempted from tax as stipulated by law).
2. Insurance claim income.
3. Interest income from financial institutions.
4. Settle and receive the remaining income from the Labor Retirement Reserve Fund Special Account.
5. Income from export.
6. Customs tax refund income.
7. Penalty income.
8. Refund of reduced commodity tax revenue.

The Bureau calls on profit-making businesses to pay special attention to reviewing their reporting status when settling accounts to avoid underreporting or omissions in various income categories. However, if they are found to have underreported or omissions in income after reporting, they may proactively report or pay the underreported taxes to the tax authorities in accordance with Article 48-1 of the Tax Collection Act, without penalty and interest. If you have any tax questions, please contact the local national tax bureau branch or tax collection office to inquire about relevant regulations or call the toll-free service number 0800-000-321 for inquiries.

(Contact Person: Section Chief Chen of the Legal Affairs Group; Tel: 2311-3711 ext. 2071)