Guide to Taiwan VAT Taxability and Rates

Understanding how Taiwan taxes your sales depends on who your customer is and whether they are a registered business (B2B) or an individual consumer (B2C).

Standard VAT rate:

The national VAT rate in Taiwan is 5%.

Tax ID format:

Taiwan uses an 8-digit Unified Business Number (UBN) for all registered businesses. The last digit is a check digit. Both resident and non-resident businesses use the same format.

Example: 12345678

If your customer provides a UBN, the transaction is treated as B2B. If no UBN is provided, the transaction is treated as B2C.

Tax rates by supply type:

How B2B sales are taxed:

For cross-border B2B transactions, Taiwan uses a reverse charge mechanism. This means:

• The non-resident seller does not charge VAT on the invoice.

• The Taiwanese business buyer self-assesses the 5% VAT on their end.

• The invoice should note that reverse charge applies and that the buyer is responsible for self-assessment.

How B2C sales are taxed:

For cross-border B2C transactions, the non-resident seller is responsible for:

• Registering for VAT in Taiwan (once the threshold is met)

• Charging 5% VAT on all B2C sales to Taiwan individuals

• Remitting the tax directly to the Taiwan tax authority

Exports and zero-rated supplies:

Resident businesses exporting goods or services outside Taiwan are generally taxed at 0%. Zero-rated supplies count toward the registration threshold for resident businesses but not for non-resident sellers.

Exemptions:

There are no entity-level exemptions for B2B SaaS or B2C SaaS in Taiwan. The difference in tax treatment between B2B and B2C is not an exemption — it is a collection mechanism. In B2B cross-border situations, the tax liability shifts to the buyer (reverse charge). This is not the same as the supply being exempt.

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