On April 8, 2025, the Taiwanese Ministry of Finance approved amendments to Article 34 of the “Regulations Governing the Application of Agreements for the Avoidance of Double Taxation with Respect to Taxes on Income.” The main change of the amendments is to extend the application period for foreign taxpayers requesting tax benefits, from 5 years to 10 years from the tax payment date.

• Commencement of Status of Limitation period: The 10-year period begins for taxes paid on or after April 11, 2020.
• Effective Date: The amendment will take effect on April 10, 2025.
• Transitional Provisions: Taxpayers who have already exceeded the 5-year limit by this date will not be eligible for the extended period.

The amendment aims to align the application period for foreign taxpayers with the recent changes to income tax regulations to enhance accessibility to tax agreements. There are a number of implications for investment funds, including the below:

• Flexibility in filing WHT reclaim: funds can now reclaim overpaid taxes within a 10-year timeframe, providing more flexibility;
• Early reclaims still recommended: despite the extended period, we advise clients to pursue claims early in order to mitigate risks associated with regulatory changes and to ensure timely refunds.

• The new 10-year rule applies only to taxes paid on or after April 11, 2020. The original 5-year rule remains for WHT paid before this date.
• If a tax treaty has specific provisions, those will take precedence, as seen in treaties such as between Germany and Taiwan.

This amendment is a positive step towards creating a more favorable tax environment for investment and trade in Taiwan. Should you have any questions or need further clarification, please do not hesitate to reach out to us.