Taiwan MOF Clarifies Corporate Income Tax Treatment of Confiscated, Expired Employee Stock Option Certificates

The Taiwanese Ministry of Finance Sept. 18 clarified the corporate income tax treatment of forfeited or expired employee stock option certificates issued in accordance with the Securities Exchange Act and the Company Act. The clarification includes that: 1) if the employer confiscates the certificates, or they expire unexercised, it should treat the recognized salary expenses as taxable income for the year of confiscation or expiration; 2) under a 2008 MOF directive, the employer should compute the compensation costs recognized every year based on fair or intrinsic value when issuing the certificates; and 3) if the certificates are confiscated due to ...