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| Upon commencement of
employment, you will begin to pay income tax. |
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A taxable
year in the R.O.C is from January 1 to December 31. |
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For your
monthly withholding tax, a STATEMENT OF MONTHLY INCOME TAX
WITHHELD will be completed by the accountant. The tax rate is
as follows: |
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LENGTH
OF STAY IN TAIWAN WITHIN THE TAXABLE YEAR |
TAX
RATE |
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Less
than 183 days |
20% |
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Over
183 days |
10% |
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For your
annual income tax, a WITHHOLDING & NON-WITHHOLDING TAX STATEMENT
will be filed by the accountant with the National Tax
Administration. This is the compilation of all the STATEMENTS
OF MONTHLY INCOME TAX WITHHELD accumulated in the taxable
year. |
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| Classification
According to
the Income Tax Law of the R.O.C., aliens are classified under
two types, which is determined by their length of stay in the
R.O.C. |
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Non-Resident of the R.O.C.
If you
entered Taiwan in the middle of the taxable year and do not
complete 183 days by the end of the taxable year, you will be
classified a non-resident. Therefore, your withholding tax rate shall be 20%.
|
LENGTH
OF STAY IN TAIWAN WITHIN THE TAXABLE YEAR |
TAX
RATE |
INCOME
TAX RETURN |
|
Not
more than 90 days |
20% |
Not
required |
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Over
90 days but less than 183 days |
20% |
Required |
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Resident of the R.O.C.
If your length of
stay in Taiwan is over 183 days within the taxable year.
An income
tax return shall be filed for the taxable year. The withholding
rate shall be based on the Progressive Tax Rate:
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NET
TAXABLE INCOME |
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TAX
RATE |
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PROGRESSIVE DIFFERENCE |
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TAX DUE |
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0 |
to |
370,000 |
x |
6% |
- |
0 |
= |
Tax
Due |
|
370,001 |
to |
990,000 |
x |
13% |
- |
25,900 |
= |
Tax
Due |
|
990,001 |
to |
1,980,000 |
x |
21% |
- |
105,100 |
= |
Tax
Due |
|
1,980,001 |
to |
3,270,000 |
x |
30% |
- |
283,300 |
= |
Tax
Due |
|
3,270,001 |
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and
over |
x |
40% |
- |
655,300 |
= |
Tax
Due |
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Computation of
Residence
The
computation of your resident period is
based on the date of entry stamped on your passport. If
you have entered and exited Taiwan a number of times within a taxable year,
the resident period shall be accumulated. |
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Exemptions
and Deductions
Exemptions
for dependents can only be applied four (4) months after they
receive their Alien Resident Certificates (ARC).
Dependents
include:
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Your or
your spouse's lineal
ascendants having attained
sixty years of age, or be incapable of earning a livelihood,
and is being supported by you.
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Your children
under twenty (20) years of age; or although
having attained twenty (20) years of age, are being supported by
you by reason of school attendance or by reason of
physical or mental disability and incapable of earning a
livelihood.
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Your or
your spouse's siblings
under twenty (20) years of
age; or although having attained twenty (20) years of age, are
supported by you or your spouse by reason of school attendance or by
reason of physical or mental disability and incapable of
earning a livelihood.
To claim
exemptions for your dependents who do not join you in the R.O.C., their
official certificates and proof
that they are being supported by you should be
submitted. These documents must be authenticated by your
government.
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Exemptions
There is
a NT$ 74,000 exemption each for you, your spouse and your dependent.
- Deductions
If you are
single, there is a NT$ 44,000 deduction. If you are
married and filing a joint return, the deduction shall be NT$ 67,000.
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Special Deductions
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Special Deduction for Salary or Wages
Each
person receiving salary may claim a deduction for his/her salary
up to a maximum of NT$ 75,000. Therefore, if you are
filing your income tax jointly with your spouse, you get a
deduction of NT$ 75,000 each.
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Special Deduction for Disability
There is
a NT$ 74,000 deduction for each taxpayer, spouse or dependent
who is a mental patient or a disabled person. A psychiatrist¡¦s
diagnosis certificate or a copy of Disability Identification
should be attached when claiming this deduction.
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TYPE |
AMOUNT |
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Exemption |
Single
taxpayer, N=1
Taxpayer with dependents, N=number of dependents including
taxpayer |
74,000
(n/365) x N |
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Deduction - single |
Single
taxpayer |
44,000
(n/365) |
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Deduction - married |
Married couple filing a joint return |
67,000
(n/365) |
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Special Deduction for Salary and Wages |
For
single taxpayer, S=1
For a married couple filing a joint return, S=2 |
75,000
x S |
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Special Deduction for Disability |
D=total number of disabled or mental patients |
74,000
x D |
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Computing
for Your Annual Income Tax
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Total
Income Before Tax |
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xxx |
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Less: |
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Exemption |
74,000
x N |
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Deduction |
44,000
or 67,000 |
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Special
Deduction for Salary and Wages |
75,000
x S |
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Special
Deduction for Disability |
74,000
x D |
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Total
Exemption |
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xxx |
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Net
Taxable Income |
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xxx |
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x Tax
Rate (see
Income Bracket) |
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% |
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Taxable
income before Progressive Difference |
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Less:
Progressive Difference |
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Tax Due |
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xxx |
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Less:
Total Tax Withheld |
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xxx |
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Tax Due
/ (Tax Refund) |
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xxx |
Example:
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Total
Income Before Tax |
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600,000 |
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Less: |
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Exemption |
74,000 |
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Deduction |
44,000 |
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Special
Deduction for Salary and Wages |
75,000 |
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Special
Deduction for Disability |
0 |
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Total
Exemption |
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193,000 |
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Net
Taxable Income |
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407,000 |
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x Tax
Rate (see
Income Bracket) |
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13% |
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Taxable
income before Progressive Difference |
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52,910 |
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Less:
Progressive Difference |
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25,900 |
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Tax Due |
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27,010 |
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Less:
Total Tax Withheld |
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60,000 |
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Tax Due
/ (Tax Refund) |
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(32,990) |
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Applying for a Tax Refund |
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Related Forms and Documents
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FORM |
FREQUENCY |
DESCRIPTION |
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Statement of Monthly Income Tax Withheld |
Monthly |
Contains monthly taxable income and tax withheld. Must
have company seal. |
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Withholding & Non-Withholding Tax Statement |
Before
February 15 |
Compilation of Statements of Monthly Income Tax Withheld.
These must be submitted to the National Tax Administration for validation. |
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Income
Tax Return (ITR) |
May |
Will
be mailed to the company by the National Tax
Administration. You will need to complete this form
and affix your signature. Your signature must match
the one in your passport. |
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Tax
Refund Application Form |
Anytime |
- If you plan to leave Taiwan before
your tax refund is release, you may authorize a
third party to represent you in collecting the Tax Refund check.
There is a section on this on the form.
- The third party must affix his/her
name chop on the form.
- It is advisable that a Taiwanese be
nominated as the third party representative.
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Documents needed to apply for a tax refund
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Withholding & Non-Withholding Tax Statement
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Income Tax Return (ITR)
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Alien Resident Certificate (ARC)
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Passport
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Tax
Refund Application Form
Release of the Tax Refund
The time it takes to
receive a tax refund check from the National Tax Administration
is indefinite. When your tax refund check is ready, you or
your authorized representative will receive a notice from the
National Tax Administration in the mail.
If you
nominated a third party representative, the
representative must bring his/her name chop to claim the tax
refund check.
The tax
refund check will be payable to you and it is non-transferable.
Miscellaneous
Since the
time it takes to receive a tax refund check from the National
Tax Administration is indefinite, it is advisable that a
Taiwanese be nominated as the authorized representative to
collect the tax refund check. You can then have the
check mailed to you. Most banks will honor government
checks.
The tax
refund check will be in NEW TAIWAN DOLLARS (NT$). |
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National Tax Administration (Southern Taiwan Province) |
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