Viewpoints
2021-03-22
Attention to the Prescription on the Outstanding Accounts Payable for Taiwan Companies It is inevitable that accounts payable happens in businesses. The Taiwan National Taxation Bureau reminds that when companies declare for corporate income tax, it is important to pay attention to the prescription on various kinds of outstanding accounts payable, which can vary from 2 – 15 years. Furthermore, if a payment is unsettled upon prescription, it must be changed to other income in accounting in that current year. When Taiwan companies file tax returns, many expenses will be listed as expenses in the year in which rights and responsibilities are incurred. But in fact, the payment has not yet been paid. Since the Civil Code Article 125 to 127 stipulates prescription for various payments, it continues to be delayed until the time limit of the creditor’s claim expires, in theory, the Taiwan company does not have to […]
2021-03-17
U.S. Tax Tips When You Got a PPP Loan Paycheck Protection Program (PPP) loan is intended to help small businesses maintain payrolls and continue necessary payroll-related payments like rent and utilities. And if you meet the criteria, the loan may be forgiven. However, some small business owners do not know how to deal with this PPP loan forgiveness when they file the tax return. This article will give you some tips. Congress specified, and the IRS clarified, that forgiven PPP loans will not count as taxable income. This applies whether your entire loan is forgiven or just a portion. For the expenses paid with PPP loan, IRS initially stated that those expenses cannot be deducted if the loan was or will be forgiven. However, that changed with the coronavirus relief act signed into law on Dec. 27, 2020, which specifies that deductions should not be denied simply due […]
2021-03-17
Tax Changes You Need to Know Before Filing Your U.S. 2020 Tax Return There are several tax changes or annual inflation adjustments for tax year 2020. This article will give you a short checklist of tax changes you need to know before you file the 2020 tax return. Stimulus Checks During 2020, as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act’s $2 trillion relief package, the government sent up to $1,200 in the form of a stimulus check to millions of Americans. But do you know how to report your stimulus checks income when you file the tax return? The good news is your stimulus check will not count as taxable income. Eligible Americans who did not receive the first or second payment can claim a Recovery Rebate Credit based on their 2020 income on the 2020 tax returns. Standard Deduction Standard […]
2021-03-17
An Overview on Shenzhen Individual Bankruptcy Regulations China’s first regulation on individual bankruptcy, the Regulations of Shenzhen Special Economic Zone on Individual Bankruptcy, came into force on 1 March 2021. An overview on the said Regulations is enclosed hereby for your easy reference. Who can file for bankruptcy? According to the Regulations, eligible debtors and creditors both can file bankruptcy petitions to the court. The debtors who can file for bankruptcy shall meet the following requirements: (1) have been living in Shenzhen and have paid social insurance for 3 consecutive years in Shenzhen; (2) unable to pay off their debts because of business struggles or problematic consumption or their assets are insufficient to pay off all the debts. The creditors who hold more than RMB500,000 due creditor’s rights against the debtor alone or jointly can also file a bankruptcy petition to the court when the […]
2021-02-23
Why I Receive the US Form 1099-INT? If you received interest more than $10, you would get a Form 1099-INT. A 1099-INT tax form is a record that a person or entity paid you interest during the tax year. You may not have to pay income tax on all the interest it reports, but you still need to report this information on the return. The Internal Revenue Service requires most payments of interest income to be reported on tax form 1099-INT by the person or entity that makes the payments. This is most commonly a bank, other financial institution, or government agency. The form 1099-INT will include your Social Security Number or Taxpayer Identification Number and the amount you received. When you file your tax return, you don’t need to attach the copies of the form 1099-INT you receive, but you need to report the information from […]
2021-02-23
The Impact of Taiwan Civil Code New Amendment on Taxation According to Taiwan Civil Code, the age of majority has been lowered to 18 years old. The Taiwan Executive Yuen also amended the regulations of tax allowance in the Income Tax Act and the Estate and Gift Tax Act accordingly. In terms of income tax, what is affected is the dependent support regulations. According to the previous version, the taxpayer’s children who are under 20 years old or over 20 years old but are still in school, physically or mentally disabled or unable to earn a living can be filed as dependent support by their family, which would increase the tax allowance for the declaring household. After the Civil Code is amended, the tax act no longer defines the age of the children being supported, instead it follows the Civil Code to examine if the target is an […]
2021-02-23
Prepare for Your U.S. Tax Return The tax season is coming. Kaizen highly recommend you gather and prepare you tax documents in advance for your 2020 tax return. The sooner you file the tax return, the sooner you will get you refund. This article will give you a checklist of basic documents you should prepare. Personal Information Social Security numbers and dates of birth for you, your spouse and other dependents on your tax return. If someone does not have a Social Security number, you will need their tax identity numbers instead. Copies of last year’s tax return, if possible. Income Information Income from employment: you should receive the Form W-2 from your employer. Investment income: Various Form 1099, such as1099-INT or 1099-DIV. Income from state and local income tax refunds and/or unemployment: Forms 1099-G. Alimony income: taxable alimony received (only appliable to divorces finalized before January […]
2021-02-23
HK and Macao Tax Professionals May Practise in Qianhai and Shekou Recently, Shenzhen tax authority released the interim measures for managing the practice of Hong Kong and Macao tax‑related professionals in the Shenzhen Qianhai‑Shekou Area of the China (Guangdong) Pilot Free Trade Zone (hereinafter referred to as the interim measures), which came into force on 13 January 2021. According to the interim measures, qualified tax- related professionals from Hong Kong and Macao are allowed to practise in Shenzhen Qianhai- Shekou Area of Guangdong Free Trade Zone after registering with Shenzhen tax authority. What kind of tax-related professionals can apply for the registration? According to the interim measures, qualified tax-related professionals refer to the permanent residents of Hong Kong and Macao who have obtained the qualification of tax agent in Hong Kong or the qualification of auditor and accountant in Macao. Hong Kong tax agent refers to the person who […]
2021-01-26
U.S. Second Round of Economic Impact Payments The IRS and the Treasury Department began issuing a second round of Economic Impact Payments, often referred to as stimulus payments, late December 2020. This article will give you a summary of the second round of economic impact payments. How Can I Receive the Second Payments? According to the IRS, there is no action required by eligible individuals to receive this second payment. The payments are automatically sent to the eligible individuals. Am I Eligible for the Second Payments? Generally, U.S. citizens and resident aliens who are not eligible to be claimed as a dependent on someone else’s income tax return are eligible for this second payment. Eligible individuals will automatically receive an Economic Impact Payment of up to $600 for individuals or $1,200 for married couples and up to $600 for each qualifying child. Most people who have […]
2021-01-26
Taiwan Increase on 2021 Withholding Amount Threshold Starting from 1 January, 2021, Taiwan basic monthly salary has been adjusted to NT$24,000. When a tax withholder pays wages to individuals living outside Taiwan (referred to non-residents), the withholding rate for calculation is adjusted accordingly. In 2020, monthly salary below NT$35,700 is subject to a 6% withholding rate, while exceeding NT$35,700 is subject to 18%. In 2021, the cut-off point would be increased to NT$36,000. Who is considered as non-resident? Taiwan Income Tax Act Article 7 stipulates the definition of resident: 1. Those who have a residence in Taiwan and often live in Taiwan. 2. Those who do not have a residence in Taiwan but stay in the country for a total of 183 days during a tax year. A person who does not meet the above definition of a resident is considered as a non-resident. Non-resident s are mostly foreigners, […]