Taiwan Updates E-Invoicing Requirements with MIG 4.0 and New Penalties
Taiwan updates e-invoicing requirements with MIG 4.0 and new penalties by upgrading its e-invoicing system. The new upgrade includes the introduction of the MIG 4.0 format starting January 2024. This is part of the government’s ongoing efforts to fully transition from paper to electronic invoicing. This process begun in 2006 and has since become mandatory for all businesses, including foreign entities operating in Taiwan.
Key Changes and Requirements
- New E-Invoice Format (MIG 4.0): From January 2024, companies in Taiwan are required to adopt the MIG 4.0 version for electronic invoices (eGUI). While previous versions (MIG 3.1 and 3.2) can still be used, they will only be valid until 31 December 2025. The e-invoice must be sent to the Ministry of Finance’s platform within 7 days for B2B transactions and 2 days for B2C transactions. The e-invoice format is based on XML, and a PDF copy must also follow government specifications.
- Mandatory E-Invoicing Compliance: Since January 2021, electronic invoicing has been compulsory for both domestic and foreign businesses in Taiwan. The eGUI system requires companies to issue and report invoices electronically through an approved service provider or the government’s free transmission software. As such, failure to comply with these regulations can result in fines of up to TW$ 15,000. Additionally, potential late tax penalties can also be added to the fines.
- E-Invoicing Process: The eGUI system is integrated with Taiwan’s national invoicing platform, which standardizes the issuance, cancellation, and archiving of electronic invoices. Moreover, businesses must ensure that all e-invoices are properly signed, transmitted, and archived for at least five years. As such, e-invoices must also include essential details such as the GUI number, customer email, taxable value, and description of goods or services provided.
- Special Requirements for Foreign Digital Service Providers: Foreign businesses providing digital services to Taiwanese consumers are required to issue cloud-based GUI invoices for their B2C transactions. These invoices can be reported through a local certified invoicing agent or using the Ministry of Finance’s software. Similarly, the invoices must meet the latest GUI format requirements and be submitted within the specified deadlines.
Compliance and Penalties
The Taiwanese Ministry of Finance has introduced penalties for non-compliance with the new e-invoicing requirements. These include fines for late submissions and discrepancies between reported and actual transaction data. To help businesses transition, the government has provided detailed guidelines. Additionally, a grace period for adopting the new MIG 4.0 format.
As Taiwan continues to advance its digital infrastructure, these updates to the e-invoicing system are aimed at improving efficiency, ensuring compliance, and reducing the VAT gap. Consequently, businesses operating in Taiwan must stay informed and ensure they meet all regulatory requirements to avoid potential penalties. Meanwhile, get in touch with one of our consultants here.
