Goto Main Content
:::

Article Search Result

Title: Statute for Industrial Innovation CH
Category: Ministry of Economic Affairs(經濟部)
Article 12-2
Where a domestic academic or research institution assigns the intellectual property rights resulting from its R&D achievements and conferred on it to a company or licenses the company to use such rights in accordance with Paragraph 1, Article 6 of the Fundamental Science and Technology Act, and acquires shares in the company in return, and distributes such shares to the domestic creator of such intellectual property rights in accordance with Paragraph 3, Article 6 of the Fundamental Science and Technology Act, such domestic creator may opt to exclude the new shares so acquired from his/her income taxable in the year such shares are acquired. Once such option is chosen, it cannot be reversed. However, after the creator has opted to exclude such new shares from his/her income taxable in the year such shares are acquired, if the shares are transferred or are delivered by book-entry transfer to an account with a securities depository enterprise, the entire transfer price, the market price of the shares at the time of gift or distribution as estate, or the market price of the shares on the date of book-entry transfer shall be included in the creator’s salary for the year of transfer or book-entry transfer and be declared for assessment of income tax in accordance with the Income Tax Act.
Where a domestic creator has opted to exclude the acquired new shares from his/her taxable income in the year such shares are acquired in accordance with the preceding paragraph, and has held such shares and worked and carried out research and development at an industry or an academic or research institution within the territory of the R.O.C. accumulatively for two years, if the shares are transferred or are delivered by book-entry transfer to an account with a securities depository enterprise, and the entire transfer price, the market price of the shares at the time of gift or distribution as estate, or the market price of the shares on the date of book-entry transfer is higher than the market price of the shares at the time they are acquired by the creator, the market price of the shares at the time they are acquired by the creator shall be included in the creator’s revenue for the year of transfer or book-entry transfer, and be declared for assessment of income tax. Where an R.O.C. creator has not declared the price of the shares for assessment of income tax or has declared the price for assessment of income tax but cannot provide documentation proof of the market price of the shares at the time they are acquired by the creator, and the information is not available from the taxation authority, the above provisions shall not apply.
The assignment under the preceding two paragraphs refers to purchase, sale, gift, distribution as estate, cancellation of shares as a result of capital reduction, corporate liquidation, or change in ownership due to other causes.
Where a domestic academic or research institution distributes shares to a domestic creator in accordance with Paragraph 1 of this Article and desires to be qualified for the incentive under that paragraph, it shall submit duly formatted documents to the competent authority specified in Paragraph 3, Article 6 of the Fundamental Science and Technology Act for approval. A copy of the decision of the competent authority shall be served on the company issuing the shares and the taxation authority at the place where the company is located.
The scope of the intellectual property rights derived from an academic or research institution’s own R&D achievements in accordance with Paragraph 1 and conferred on the institution in accordance with Paragraph 1, Article 6 of the Fundamental Science and Technology Act, the rules for recognition of the shares distributed to domestic creators in accordance with Paragraph 3, Article 6 of the Fundamental Science and Technology Act, the rules for recognition of working and carrying out research and development at an industry or an academic or research institution within the territory of the R.O.C. under Paragraph 2, the formats of the documents, the application procedure and the required documents under the preceding paragraph, and other related matters shall be prescribed by the Ministry of Science and Technology.
The procedure for declaring deferral of the income tax payable for the shares acquired by the domestic creators under Paragraphs 1 and 2, the documents to be submitted, and other related matters shall be prescribed by the Ministry of Finance.