Following a request by Phoenix, a software products and services company, during the fiscal year that ended on September 30 2009, the Taiwan National Tax Authority (TNTA) re-examined the company’s allocation of expenses under the country’s transfer pricing guidelines for the fiscal years 2000 to 2006.

The company has now received final tax assessments from the TNTA for each of these years. They are in accordance with the proposal submitted by the company. The assessments call for total tax and interest payments of about $4 million, of which around $1.9 million has been paid by Phoenix. The remaining $2.1 million will be paid by December 31 2009 in final settlement of its liabilities for taxes and interest for these years.

In accounting for these uncertain tax positions, the company had previously recorded tax and interest expenses totaling about $9.2 million for the relevant years. As a result of the settlement the company now expects its tax expense relating to these years to fall to $5.2 million this year.

“We are very pleased to have finally settled this long standing transfer pricing dispute with the TNTA and to have settled our tax liability for fiscal years 2000 to 2006,” said Richard Arnold, chief operating officer and chief financial officer of Phoenix Technologies in a statement. “We continue to work with the TNTA in respect of fiscal years 2007 and 2008 and are hopeful of reaching an acceptable settlement in respect of those additional years over the coming months.”

The TNTA was unavailable for comment.