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Income Tax
 12 Months Ended
Dec. 31, 2019
Text block [abstract]  
Income Tax
27.
INCOME TAX
 
The Company and its subsidiaries expected to file a consolidate tax return for corporate income tax starting from 2019 and for unappropriated earnings starting from 2018.
 
a.
Income tax recognized in profit or loss
 
The major components of income tax were as follows:
 
 
 
For the Year Ended December 31
 
 
2017
 
2018
 
2019
 
 
NT$
 
NT$
 
NT$
 
US$ (Note 4)
 
 
 
 
 
 
 
 
 
Current income tax
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
In respect of the current year
 
$
4,979,766
 
 
$
5,207,309
 
 
$
5,002,954
 
 
$
167,267
 
Income tax on unappropriated earnings
 
 
1,076,353
 
 
 
(1,022,560
)
 
 
19,115
 
 
 
639
 
Changes in estimate for prior years
 
 
(88,162
)
 
 
(103,822
)
 
 
(352,579
)
 
 
(11,788
)
 
 
 
5,967,957
 
 
 
4,080,927
 
 
 
4,669,490
 
 
 
156,118
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Deferred income tax
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
In respect of the current year
 
 
534,472
 
 
 
(227,327
)
 
 
563,512
 
 
 
18,840
 
Effect of tax rate changes
 
 
—  
 
 
 
657,346
 
 
 
54,072
 
 
 
1,808
 
Changes in estimate for prior years
 
 
52,872
 
 
 
5,696
 
 
 
(213,758
)
 
 
(7,147
)
Effect of foreign currency exchange differences
 
 
(31,698
)
 
 
(3,273
)
 
 
(62,070
)
 
 
(2,075
)
 
 
 
555,646
 
 
 
432,442
 
 
 
341,756
 
 
 
11,426
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income tax expense recognized in profit or loss
 
$
6,523,603
 
 
$
4,513,369
 
 
$
5,011,246
 
 
$
167,544
 
A reconciliation of income tax expense calculated at the statutory rates and income tax expense recognized in profit or loss was as follows:
 
 
 
For the Year Ended December 31
 
 
2017
 
2018
 
2019
 
 
NT$
 
NT$
 
NT$
 
US$ (Note 4)
 
 
 
 
 
 
 
 
 
Profit before income tax
 
$
31,020,663
 
 
$
31,937,678
 
 
$
23,279,811
 
 
$
778,328
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income tax expense calculated at the statutory rates
 
$
10,890,498
 
 
$
13,540,599
 
 
$
11,802,811
 
 
$
394,611
 
Nontaxable expense in determining taxable income
 
 
483,715
 
 
 
353,019
 
 
 
459,133
 
 
 
15,350
 
Tax-exempt income
 
 
(623,566
)
 
 
(2,515,453
)
 
 
(495,883
)
 
 
(16,579
)
Additional income tax on unappropriated earnings
 
 
1,076,353
 
 
 
(1,022,560
)
 
 
19,115
 
 
 
639
 
 
 
 
 
For the Year Ended December 31
 
 
2017
 
2018
 
2019
 
 
NT$
 
NT$
 
NT$
 
US$ (Note 4)
 
 
 
 
 
 
 
 
 
Loss carry-forward and income tax credits currently used
 
$
(1,124,043
)
 
$
(971,124
)
 
$
(898,198
)
 
$
(30,030
)
Remeasurement of deferred income tax assets, net
 
 
(4,131,473
)
 
 
(4,776,271
)
 
 
(5,588,335
)
 
 
(186,838
)
Changes in estimate for prior periods
 
 
(88,162
)
 
 
(103,822
)
 
 
(352,579
)
 
 
(11,788
)
Withholding tax
 
 
40,281
 
 
 
8,981
 
 
 
65,182
 
 
 
2,179
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income tax expense recognized in profit or loss
 
$
6,523,603
 
 
$
4,513,369
 
 
$
5,011,246
 
 
$
167,544
 
 
 
For the year ended December 31, 2017, the Group applied a tax rate of 17% for resident entities subject to the Income Tax Law of the R.O.C. The Income Tax Act in the R.O.C. was amended in 2018, and the corporate income tax rate was adjusted from 17% to 20%. In addition, the rate of the corporate surtax applicable to the 2018 unappropriated earnings was reduced from 10% to 5%. The subsidiaries located in China applied tax rate of 25%. For other jurisdictions, the Group measures taxes by using the applicable tax rate for each individual jurisdiction.
 
In July 2019, the President of the R.O.C. announced the amendments to the Statute for Industrial Innovation, which stipulate that the amounts of unappropriated earnings in 2018 and thereafter that are reinvested in the construction or purchase of certain assets or technologies are allowed as deduction when computing the income tax on unappropriated earnings. The Group has already deducted the amount of capital expenditure from the unappropriated earnings in 2018 that was reinvested when calculating the tax on unappropriated earnings. However, the Group did not deduct such investment amounts from the undistributed earnings in calculation of income tax on unappropriated earnings in 2019.
 
b.
Income tax recognized directly in equity
 
 
 
For the Year Ended December 31
 
 
2017
 
2018
 
2019
 
 
NT$
 
NT$
 
NT$
 
US$ (Note 4)
 
 
 
 
 
 
 
 
 
Deferred income tax
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Related to employee share options
 
$
262
 
 
$
(1,099
)
 
$
1,404
 
 
$
47
 
 
c.
Income tax recognized in other comprehensive income
 
 
 
For the Year Ended December 31
 
 
2017
 
2018
 
2019
 
 
NT$
 
NT$
 
NT$
 
US$ (Note 4)
 
 
 
 
 
 
 
 
 
Deferred income tax
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Related to remeasurement of defined benefit plans
 
$
(51,217
)
 
$
55,346
 
 
$
74,308
 
 
$
2,484
 
Unrealized loss on equity instruments at fair
value through other comprehensive income
 
 
—  
 
 
 
—  
 
 
 
(78,124
)
 
 
(2,612
)
 
 
 
 
 
 
 
For the Year Ended December 31
 
 
2017
 
2018
 
2019
 
 
NT$
 
NT$
 
NT$
 
US$ (Note 4)
 
 
 
 
 
 
 
 
 
Effect of tax rate changes
 
$
—  
 
 
$
70,755
 
 
$
—  
 
 
$
—  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income tax recognized in other comprehensive income
 
$
(51,217
)
 
$
126,101
 
 
$
(3,816
)
 
$
(128
)
 
 
d.
Current tax assets and liabilities
 
 
 
December 31
 
 
2018
 
2019
 
 
NT$
 
NT$
 
US$ (Note 4)
 
 
 
 
 
 
 
Current tax assets
 
 
 
 
 
 
 
 
 
 
 
 
Tax refund receivable
 
$
50,456
 
 
$
90,569
 
 
$
3,028
 
 
 
 
 
 
 
 
 
Prepaid income tax
 
 
473,807
 
 
 
462,523
 
 
 
15,464
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
524,263
 
 
$
553,092
 
 
$
18,492
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Current tax liabilities
 
 
 
 
 
 
 
 
 
 
 
 
Income tax payable
 
$
6,781,136
 
 
$
4,858,578
 
 
$
162,440
 
 
 
e.
Deferred tax assets and liabilities
 
The Group offset certain deferred tax assets and deferred tax liabilities which met the offset criteria.
 
The movements of deferred tax assets and deferred tax liabilities were as follows:
 
For the year ended December 31, 2017
 
 
 
Balance at January 1
 
Recognized in Profit or Loss
 
Recognized in Other Comprehensive Income
 
Recognized in Equity
 
Exchange Differences
 
Balance at December 31
 
 
NT$
 
NT$
 
NT$
 
NT$
 
NT$
 
NT$
Deferred tax assets (liabilities)
 
 
 
 
 
 
 
 
 
 
 
 
             
Temporary differences
 
 
 
 
 
 
 
 
 
 
 
 
Property, plant and equipment
 
$
(3,758,847
)
 
$
(101,576
)
 
$
—  
 
 
$
—  
 
 
$
(18,643
)
 
$
(3,879,066
)
Defined benefit obligation
 
 
873,484
 
 
 
(26,736
)
 
 
(51,217
)
 
 
—  
 
 
 
(15,291
)
 
 
780,240
 
FVTPL financial instruments
 
 
(21,363
)
 
 
(86,342
)
 
 
—  
 
 
 
—  
 
 
 
2,802
 
 
 
(104,903
)
Others
 
 
1,079,824
 
 
 
(22,748
)
 
 
—  
 
 
 
262
 
 
 
(28,929
)
 
 
1,028,409
 
 
 
 
(1,826,902
)
 
 
(237,402
)
 
 
(51,217
)
 
 
262
 
 
 
(60,061
)
 
 
(2,175,320
)
Loss carry-forward
 
 
1,124,541
 
 
 
(456,246
)
 
 
—  
 
 
 
—  
 
 
 
13,146
 
 
 
681,441
 
Investment credits
 
 
382,736
 
 
 
138,002
 
 
 
—  
 
 
 
—  
 
 
 
13,475
 
 
 
534,213
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(319,625
)
 
$
(555,646
)
 
$
(51,217
)
 
$
262
 
 
$
(33,440
)
 
$
(959,666
)
 
For the year ended December 31, 2018
 
 
 
Balance at January 1
 
Adjustment on initial Application of IFRS 15
 
Recognized in
Profit or Loss
 
Recognized in Other Comprehensive Income
 
Recognized in
Equity
 
Exchange
Differences
 
Acquisitions
Through Business Combinations
 
Balance at
December 31
 
 
NT$
 
NT$
 
NT$
 
NT$
 
NT$
 
NT$
 
NT$
 
NT$
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Deferred tax assets (liabilities)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                 
Temporary differences
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Property, plant and equipment
 
$
(3,879,066
)
 
$
—  
 
 
$
(600,229
)
 
$
—  
 
 
$
—  
 
 
$
(21,146
)
 
$
(45,873
)
 
$
(4,546,314
)
Defined benefit obligation
 
 
780,240
 
 
 
—  
 
 
 
(131,687
)
 
 
126,101
 
 
 
—  
 
 
 
27,884
 
 
 
262,286
 
 
 
1,064,824
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
FVTPL financial instruments
 
(104,903
)
 
 
—  
 
 
 
284,659
 
 
 
—  
 
 
 
—  
 
 
 
(137
)
 
 
27,402
 
 
 
207,021
 
Others
 
 
1,028,409
 
 
 
(97,358
)
 
 
(26,147
)
 
 
—  
 
 
 
(1,099
)
 
 
74,327
 
 
 
294,540
 
 
 
1,272,672
 
 
 
 
(2,175,320
)
 
 
(97,358
)
 
 
(473,404
)
 
 
126,101
 
 
 
(1,099
)
 
 
80,928
 
 
 
538,355
 
 
 
(2,001,797
)
Loss carry-forward
 
 
681,441
 
 
 
—  
 
 
 
(50,059
)
 
 
—  
 
 
 
—  
 
 
 
28,293
 
 
 
12,600
 
 
 
672,275
 
Investment credits
 
 
534,213
 
 
 
—  
 
 
 
91,021
 
 
 
—  
 
 
 
—  
 
 
 
5,932
 
 
 
—  
 
 
 
631,166
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(959,666
)
 
$
(97,358
)
 
$
(432,442
)
 
$
126,101
 
 
$
(1,099
)
 
$
115,153
 
 
$
550,955
 
 
$
(698,356
)
 
For the year ended December 31, 2019
 
 
 
Balance at January 1
 
Recognized in Profit or Loss
 
Recognized 
 
in Other Comprehensive Income
 
 
Recognized 
 
in Equity
 
 
Exchange Differences
 
Acquisitions through Business Combinations
 
Balance at
December 31
 
 
NT$
 
NT$
 
NT$
 
NT$
 
NT$
 
NT$
 
NT$
Deferred tax assets (liabilities)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Temporary differences
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Property, plant and equipment
 
$
(4,546,314
)
 
$
(80,593
)
 
$
—  
 
 
$
—  
 
 
$
(17,949
)
 
$
(16,917
)
 
$
(4,661,773
)
Defined benefit obligation
 
 
1,064,824
 
 
 
(57,746
)
 
 
74,308
 
 
 
—  
 
 
 
(2,803
)
 
 
—  
 
 
 
1,078,583
 
FVTPL financial instruments
 
 
207,021
 
 
 
43,285
 
 
 
—  
 
 
 
—  
 
 
 
9
 
 
 
—  
 
 
 
250,315
 
Others
 
 
1,272,672
 
 
 
6,148
 
 
 
(78,124 
) 
 
 
1,404
 
 
 
(21,763
)
 
 
8,184
 
 
 
1,,188,521
 
 
 
 
(2,001,797
)
 
 
(88,906
)
 
 
(3,816
)
 
 
1,404
 
 
 
(42,506
)
 
 
(8,733
)
 
 
(2,141,354
)
Loss carry-forward
 
 
672,275
 
 
 
(166,128
)
 
 
—  
 
 
 
—  
 
 
 
(12,203
)
 
 
48,837
 
 
 
542,781
 
Investment credits
 
 
631,166
 
 
 
(86,722
)
 
 
—  
 
 
 
—  
 
 
 
(7,404
)
 
 
—  
 
 
 
537,040
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(698,356
)
 
$
(341,756
)
 
$
(3,816
 )
 
$
1,404
 
 
$
(62,113
)
 
$
40,104
 
 
$
(1,064,533
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance at January 1
 
Recognized in Profit or Loss
 
Recognized 
 
in Other Comprehensive Income
 
 
Recognized 
 
in Equity
 
 
Exchange Differences
 
Acquisitions through Business Combinations
 
Balance at
December 31
 
 
US$ (Note 4)
 
US$ (Note 4)
 
US$ (Note 4)
 
US$ (Note 4)
 
US$ (Note 4)
 
US$ (Note 4)
 
US$ (Note 4)
Deferred tax assets (liabilities)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Temporary differences
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Property, plant and equipment
 
$
(152,000
)
 
$
(2,694
)
 
$
—  
 
 
$
—  
 
 
$
(600
)
 
$
(566
)
 
$
(155860
)
Defined benefit obligation
 
 
35,601
 
 
 
(1,931
)
 
 
2,484
 
 
 
—  
 
 
 
(94
)
 
 
—  
 
 
 
36,060
 
FVTPL financial instruments
 
 
6,921
 
 
 
1,447
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
—  
 
 
 
8,368
 
Others
 
 
42,550
 
 
 
205
 
 
 
(2,612
)
 
 
47
 
 
 
(726
)
 
 
274
 
 
 
39,738
 
 
 
 
(66,928
)
 
 
(2,973
)
 
 
(128
)
 
 
47
 
 
 
(1,420
)
 
 
(292
)
 
 
(71,694
)
Loss carry-forward
 
 
22,477
 
 
 
(5,554
)
 
 
—  
 
 
 
—  
 
 
 
(408
)
 
 
1,633
 
 
 
18,148
 
Investment credits
 
 
21,102
 
 
 
(2,899
)
 
 
—  
 
 
 
—  
 
 
 
(248
)
 
 
—  
 
 
 
17,955
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(23,349
)
 
$
(11,426
)
 
$
(128
)
 
$
47
 
 
$
(2,076
)
 
$
1,341
 
 
$
(35,591
)
 
f.
Items for which no deferred tax assets have been recognized for loss carry-forward, investment credits and deductible temporary differences
 
 
 
December 31
 
 
2018
 
2019
 
 
NT$
 
NT$
 
US$ (Note 4)
 
 
 
 
 
 
 
Loss carry-forward
 
$
666,043
 
 
$
966,783
 
 
$
32,323
 
Investment credits
 
 
—  
 
 
 
51,217
 
 
 
1,712
 
Deductible temporary differences
 
 
332,255
 
 
 
446,754
 
 
 
14,937
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
998,298
 
 
$
1,464,754
 
 
$
48,792
 
 
The unrecognized loss carry-forward will expire through 2030.
 
g.
Information about unused loss carry-forward, unused investment credits, tax-exemption and other tax relief
 
As of December 31, 2019, the unused loss carry-forward comprised of:
 
Expiry Year
 
NT$
 
US$
 
 
 
 
(Note 4)
 
 
 
 
 
2020
 
$
104,330
 
 
$
3,488
 
2021
 
 
78,009
 
 
 
2,608
 
 
 
 
 
 
 
2022
 
 
140,301
 
 
 
4,691
 
2023
 
 
298,669
 
 
 
9,986
 
2024 and thereafter
 
 
888,255
 
 
 
29,698
 
 
 
 
 
 
 
 
 
 
 
 
$
1,509,564
 
 
$
50,471
 
 
 
As of December 31, 2019, unused investment credits comprised of:
 
 
 
Remaining Creditable Amount
 
 
Tax Credit Source
 
NT$
 
US$
 
Expiry Year
 
 
 
 
 
 
 
(Note 4)
 
 
 
 
 
 
 
 
 
 
 
 
Purchase of machinery and equipment
 
$
510,573
 
 
$
17,070
 
 
2025
Others
 
 
77,684
 
 
 
2,597
 
 
2025 and thereafter
 
 
 
 
 
 
 
 
 
 
 
 
 
$
588,257
 
 
$
19,667
 
 
 
 
As of December 31, 2019, profits attributable to the following expansion projects were exempted from income tax for a 5-year period:
 
 
 
Tax-exemption Period
 
 
 
Construction and expansion of 2007 by ASE
 
2016.01-2020.12
Construction and expansion of 2009 by ASE Test Inc.
 
2018.01-2022.12
Construction and expansion of 2008 by ASE Electronics Inc.
 
2016.01-2020.12
 
Some China subsidiaries qualified as high technology enterprises were entitled to a reduced income tax rate of 15% and were eligible to deduct certain times of research and development expenses from their taxable income.
 
h.
Unrecognized deferred tax liabilities associated with investments
 
As of December 31, 2018 and 2019, the taxable temporary differences associated with the investments in subsidiaries for which no deferred tax liabilities have been recognized were NT$28,810,874 thousand and NT$27,139,427 thousand (US$907,370 thousand), respectively.
 
i.
Income tax assessments
 
The tax returns of the Company and its R.O.C. subsidiaries through 2017 have been examined by the tax authorities.