National Taxation Bureau of Northern Area (NTBNA), Ministry of Finance stated that delinquent payments, surcharges of delinquent reporting, as well as surcharges of non-reporting paid by profit-seeking enterprises, which are stipulated in various tax acts and penalties as provided in various regulations, shall not be allowed to be claimed as expenses or losses in profit-seeking income tax returns.
       The Bureau gave an example. When it reviewed the profit-seeking enterprise income tax return filed by Company A in 2017, it found that in the company’s other operating expense account, the amount of sewage disposal fee in September increased by NT$1.5 million, which is significantly higher than the average amount compared with other months. Furthermore, the Bureau examined the content of the charging basis of sewage disposal fee. The amount of NT$0.5 million is the legal sewage disposal fee which could be allowed to be reported as taxable expenses, whereas the amount of NT$1.5 million is the penalty due to the violation of the Regulations for the Use and Management of Sewage System in Industrial District of Industrial Development Bureau, Ministry of Economic Affairs. Such penalty is not allowed to be claimed as expenses or losses in profit-seeking enterprise income tax return in accordance with Income Tax Act. As such, the Bureau dismissed the claim of the amount of NT$1.5 million penalty and assessed an additional amount of tax payment. 
        The Bureau would like to remind profit-seeking enterprises that, to maintain their rights and interests, they should comply with tax laws and related regulations while claiming expenses and losses in profit-seeking enterprise income tax returns. If you have any questions, visit the web site of the Bureau (https://www.ntbna.gov.tw) to refer to regulations concerned or dial toll-free number 0800-000-321 for dedicated assistance.