The National Taxation Bureau of the Northern Area (NTBNA), M.O.F, stated that loss on disposal of investments filed by profit-seeking enterprises that is confined to realized loss in accordance with Article 99 of the Regulations Governing Assessment of Profit-Seeking Enterprise Income Tax. If the profit-seeking enterprises suffer loss on disposal of investments owing to the liquidation of the enterprises invested, the liquidators should accomplish the liquidation in accordance with the laws. Furthermore, the point of time of filing loss on disposal of investments is the date when the recognition is achieved by conference of shareholders on the settlement forms.
       In an example given by the Bureau, Corporation A files loss on disposal of investments worth NT$5.03 million within jurisdiction in 2019, which occurred due to the liquidation of the enterprises invested. The date is March 20, 2020 when the recognition is achieved by conference of shareholders on the settlement forms. The loss on disposal of investments should be filed in 2020, so the loss on disposal of investments filed as NT$5.03 million by Corporation A in 2019 is rejected wholly, which generates an amount of additional tax levied.
       The Bureau would like to remind profit-seeking enterprises to attach the certified documents of the liquidation of the enterprises invested to the profit-seeking enterprise’s annual income tax return, and be aware that the point of time of filing loss on disposal of investments should be the date when the recognition is achieved by conference of shareholders on the settlement forms. If you have any questions, please visit the website of NTBNA (https://www.ntbna.gov.tw) to inquire about the relevant laws or call the toll-free service number 0800-000321. We will provide consulting services wholeheartedly.