Company Limited by Shares (Co., Ltd.)
股份有限公司
Company formation in Taiwan
The Co., Ltd. is best suited for: Tech companies entering the semiconductor, electronics, and hardware ecosystem, Software and SaaS companies serving the East Asian market, Hardware startups leveraging Taiwan's world-class manufacturing supply chain, Companies seeking an alternative Asia-Pacific hub outside mainland China. The standard profit-seeking enterprise income tax rate is 20%. Companies with taxable income below NTD 120,000 are exempt. Business tax (VAT equivalent) is 5% for most goods and services. Export sales are zero-rated. Withholding tax on dividends to non-residents is 21%. Withholding tax on royalties and technical service fees to non-residents is 20% (treaty-reduced where applicable). Capital gains on securities are currently exempt from income tax for most investors. Taiwan offers R&D tax credits under the Statute for Industrial Innovation — companies can claim 15% of R&D expenses as a tax credit (up to 30% of tax liability). The Alternative Minimum Tax (AMT) applies at 12% to ensure companies with significant tax incentives pay a minimum amount.
- Tech companies entering the semiconductor, electronics, and hardware ecosystem
- Software and SaaS companies serving the East Asian market
- Hardware startups leveraging Taiwan's world-class manufacturing supply chain
- Companies seeking an alternative Asia-Pacific hub outside mainland China
Key Facts
Step-by-Step Formation Process
Obtain Foreign Investment Approval from the Investment Commission (MOEA)
Foreign investors must apply to the Investment Commission under the Ministry of Economic Affairs (MOEA) for Foreign Investment Approval (FIA). The application specifies the proposed investment amount, business activities, and shareholder details. This step is mandatory for all foreign-invested companies and determines the approved scope of operations.
Reserve a company name and prepare incorporation documents
Submit a company name pre-check with the MOEA Company Registration Office. Prepare the articles of incorporation, shareholder register, and director appointment documents. The company name must include the Chinese-language company type designation. Engage a local CPA to verify the capital.
Remit capital, obtain CPA verification, and register the company
Remit the investment capital to a preparatory bank account in Taiwan. A local CPA must verify the capital contribution and issue a capital verification report. Submit the complete incorporation package (articles, capital verification, FIA approval, director details) to the MOEA for company registration. The MOEA issues the company registration certificate.
Register for tax, obtain a business licence, and open the permanent bank account
Register with the National Taxation Bureau for profit-seeking enterprise income tax, VAT (business tax), and withholding tax. Obtain the Uniform Business Number (UBN). Apply for a business licence if operating in regulated sectors. Convert the preparatory bank account to a permanent corporate account.
Required Documents
- Passport copies (notarised and apostilled) for all shareholders and directors
- Foreign Investment Approval (FIA) from the MOEA Investment Commission
- Articles of incorporation in Chinese
- CPA capital verification report
- Registered office lease agreement
- Director and supervisor appointment documents
- Shareholder resolution authorising incorporation
Cost Overview
Tax Treatment
The standard profit-seeking enterprise income tax rate is 20%. Companies with taxable income below NTD 120,000 are exempt. Business tax (VAT equivalent) is 5% for most goods and services. Export sales are zero-rated. Withholding tax on dividends to non-residents is 21%. Withholding tax on royalties and technical service fees to non-residents is 20% (treaty-reduced where applicable). Capital gains on securities are currently exempt from income tax for most investors. Taiwan offers R&D tax credits under the Statute for Industrial Innovation — companies can claim 15% of R&D expenses as a tax credit (up to 30% of tax liability). The Alternative Minimum Tax (AMT) applies at 12% to ensure companies with significant tax incentives pay a minimum amount.
Pros & Cons
- 20% corporate tax rate — competitive for Asia-Pacific and lower than Japan (30%) and South Korea (25%)
- World-leading semiconductor and electronics ecosystem — TSMC, MediaTek, Foxconn, and thousands of component manufacturers
- Excellent IP protection and rule of law — among the strongest in Asia
- Highly educated, tech-savvy workforce with competitive labour costs relative to Japan, Korea, and Singapore
- Strong infrastructure — world-class internet, logistics, and transportation networks
- Foreign Investment Approval process adds complexity and time compared to Hong Kong or Singapore
- Chinese-language requirements for all official documents and filings
- Cross-strait political uncertainty with mainland China creates geopolitical risk
- Smaller domestic consumer market (24 million) compared to Japan or South Korea
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Get StartedThis content is educational and does not constitute legal or tax advice. Always consult a qualified professional for your specific situation. Data last verified March 2026.