A logistics center set up by a foreign company can be exempt from corporate income tax. What are the requirements of applying for logistics center status?
Below are the requirements for a foreign company to set up a logistics center in a Taiwan free trade zone:
- The foreign company is an entity duly registered abroad with the place of effective management outside of Taiwan.
- The parties to whom the free trade zone entity distributes goods are not individuals.
- The foreign company has titles to the goods stored or simple processed in the free trade zone by itself or through a designated free trade zone entity. Also, the foreign company signs sales contracts with customers inside and outside of Taiwan, or conducts business through a broker, general commission agent or any other agent of an independent status, where such persons are acting in their ordinary course of business.
In addition, if the foreign company’s annual domestic sales exceed 10% of the total sales, the excess portion is not exempt from income tax.
