Taiwan – VAT Registration Threshold Increased for Foreign Providers of Digital Services 

The Ministry of Finance of Taiwan has adopted an Order introducing amendments to the Regulation on the Levy of Business Tax on Cross-Border Electronic Service Transactions. The amendment modifies the mandatory registration threshold for non-resident digital service providers. 

Timeline 

The amendment was published on April 7, 2025, and took effect on the same day. 

VAT Threshold Changes 

The amendment increased the annual threshold for non-resident providers of digital services. Before the adoption of the Order, the annual-sales threshold was NTD 480,000. The increased threshold, which should be taken into account when determining whether a taxable person is obligated to register, is now fixed at NTD 600,000. 

Impact for Foreign Digital Service Providers

The decision of the Ministry of Finance to increase the annual sales threshold for non-resident providers of digital services was primarily based on the following two parameters: 

• To equalize the registration threshold for both domestic and foreign providers of digital services; 
• To reduce the compliance costs for small businesses.

Compliance challenges 

This important change to the registration threshold should be carefully considered by both registered and non-registered foreign digital service providers. The impact of these changes could be observed in the following:

• Small registered businesses can deregister under new rules if their annual turnover is below the new threshold, resulting in lower compliance costs. 
• Economic operators providing digital services to customers in Taiwan should be aware of the latest threshold for determining whether they are required to register. 

Taiwan VAT compliance 

Foreign providers of digital services should consider the following critical points to ensure that they meet compliance requirements:

• Review of 12-month sales turnover;
• Registering for business value-added tax (VAT) when the threshold is met or before to avoid late registration penalties;
• Following the specifically designed digital reporting rules based on the cloud invoices(registration, issuance, and transactional reporting).

Feeling that Taiwan VAT compliance requirements are challenging? 

Our team of tax specialists is here to guide you through the Taiwan VAT requirements with ease. 

The Taiwanese VAT framework established for non-resident providers of digital services belongs to the group of more complicated ones for several reasons. One of those requirements is related to mandatory adherence to the digital reporting system based on e-invoicing.

Foreign providers of digital services should be aware of the very low registration threshold before initiating their business activities in the country. The increased VAT threshold will have a positive impact on small businesses with low turnover, enabling these businesses to remain exempt from VAT compliance requirements.