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Which Invoices Can Be Used to Offset Business Tax? Types of Input Vouchers and Explanations
Comprehensive analysis of deductible input voucher types, explanations of accounting item vouchers, and statutory limitations on non-deductible items
🧾 Deductible Input Voucher Types
📊 Accounting Items & Voucher Guidelines
⚠️ Business Tax Non-Deductibility Limits
🧾 Deductible Input Voucher Classification
Voucher types acceptable for business tax reporting- Triplicate Uniform Invoices.
- Triplicate Cash Register Uniform Invoices.
- Duplicate Cash Register Uniform Invoices (must include the company’s Business Uniform Number) or Receipts with Tax Amount Proof (e.g., telephone bills, tap water bills, electricity bills).
- Sales Return, Purchase Return, or Allowance Certificates (Failure to declare and deduct in the current period shall be penalized with tax補繳 and fines pursuant to Article 51, Paragraph 5 of the Value-Added and Non-Value-Added Business Tax Act).
💡 Note: Standard receipts themselves cannot be used to offset business tax, but they can be recorded as expenses for profit-seeking enterprise income tax. In cases of sales returns, purchase returns, or allowances, the corresponding certificate must be obtained and reported in the current period; cross-period reporting is not permitted.
📊 Accounting Item Voucher Categories and Reporting Guidelines
Examples and restrictions for various expense vouchers| Accounting Item | Voucher Category Example | Voucher Reporting Guidelines |
|---|---|---|
| 1. Purchases | Uniform invoices and receipts related to the sale of goods or services by the company. | Must properly obtain correct vouchers clearly stating the company title, uniform number, item description, and amount. |
| 2. Salary Expenses | Payroll receipt ledgers, overtime attendance records. | Cannot offset business tax, but can be used as profit-seeking enterprise income tax expenses. Must prepare complete payroll ledgers (including salaries, overtime pay, meal allowances); withholding taxes must be handled in accordance with the law if amounts reach certain thresholds. |
| 3. Rent Expenses | Uniform invoices, receipts, and lease agreements. | Lease agreements signed under the company name are generally reportable (not limited to one location; non-company registration addresses are also acceptable). Withholding taxes must be processed according to law if payments to individual landlords exceed NT$2,000. |
| 4. Stationery Supplies | Uniform invoices, receipts. | Includes expenditures for paper, pens, file folders, photocopying, seals, etc. |
| 5. Travel Expenses | Business travel expense reports, uniform invoices, air tickets, or boarding passes. | Must complete and stamp a business travel report. Domestic daily allowance: Manager and above NT$700, general staff NT$600; overseas expenses follow public servant travel allowance standards. |
| 6. Freight Expenses | Uniform invoices, receipts, shipping consignment notes. | Costs for delivering and selling goods via courier, freight shipping, vessels, aviation, railways, etc. |
| 7. Postage & Telecommunication | Postage purchase proofs, telecommunication company receipts. | Telephone bills actually used by the company can be reported even if not under the company title (employee personal bills require attached call logs). |
| 8. Maintenance Expenses | Uniform invoices, receipts. | Maintenance costs for company business vehicles, equipment, and offices. Items with utility extending over 2 years or amounts exceeding NT$80,000 (NT$60,000 for professional practices) should be capitalized and depreciated. |
| 9. Advertising Expenses | Uniform invoices, receipts, and advertising samples/proofs. | Includes telephone directories, desk calendars, wall calendars, newspapers, and personnel recruitment advertisements; all must be accompanied by advertising samples. |
| 10. Entertainment Expenses | Uniform invoices, receipts. | Cannot offset business tax, but can be recorded as profit-seeking enterprise income tax expenses. Subject to ceiling limits (capped at 1.5‰ of net purchases or 4.5‰ of net sales). |
| 11. Utilities (Water, Electricity, Gas) | Uniform invoices, receipts. | Expenses actually utilized by the company (if a lease agreement exists and rent is reported, utility bills not under the company title are also acceptable). |
| 12. Insurance Expenses | Uniform invoices, receipts (please attach insured unit detail schedules for labor/health insurance). | Payments for labor/health insurance, employee group life insurance, vehicle and premise insurance. Employee-borne portions cannot be reported; group life insurance premiums up to NT$2,000 per person per month are exempt from being treated as employee salary. |
| 13. Professional Fees / Miscellaneous Equipment | Invoices, professional practice receipts. | Payments to lawyers, accountants, architects, etc. (withholding tax applies if exceeding NT$2,000). Equipment costing NT$80,000 or less or with a useful life of 2 years or less can be listed under miscellaneous equipment. |
⚠️ Article 19 of the Business Tax Act: Circumstances Where Business Tax Cannot Be Offset
Statutory non-deductible items and regulationsAccording to the Value-Added and Non-Value-Added Business Tax Act and profit-seeking enterprise examination guidelines, expense expenditures must be related to company operations. Tax amounts on the following input vouchers cannot be used to offset output tax:
* Expenditures not used for principal or subsidiary business operations (e.g., personal or family expenses unrelated to company business).
* Expenditures for entertainment and social engagement (e.g., client meals, sending floral wreaths, flower baskets, potted plants, gifts, etc.).
* Goods or services rewarding individual employees (e.g., employee benefits, staff dinners, and other related expenditures).
* Passenger vehicles for private/company use (e.g., input tax incurred upon purchasing self-use sedans).
* Expenditures for entertainment and social engagement (e.g., client meals, sending floral wreaths, flower baskets, potted plants, gifts, etc.).
* Goods or services rewarding individual employees (e.g., employee benefits, staff dinners, and other related expenditures).
* Passenger vehicles for private/company use (e.g., input tax incurred upon purchasing self-use sedans).
* Important Reminder: Input vouchers should primarily be in Traditional Chinese, and you must carefully verify whether the company title, uniform number, item description, and amount are correct; receipts must be stamped with the “exempt from using uniform invoices” stamp and display the uniform number.