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Paying Taxes in Taiwan Guide

Tax Administration & Offices

www.ntat.gov.tw/english/03information.htm

http://www.ntak.gov.tw/ntak-eng/service/guide.asp

Taipei City - (02) 2311-3711
Kaohsiung City - (07) 2725-6600
Taiwan - Northern District - (03) 2339-6789
Taiwan - Central District - (04) 2329-1111
Taiwan - Southern District - (06) 2222-3111

Note:
Income tax returns shall be filed with the district Tax Administration of the individual's local residence. Those residing in Taipei City or Kaohsiung City shall file with the Foreign Affairs Office of the Tax Administration. Income tax return for taxpayers who live and work in different counties may be filed by mail.

Basics

*Taiwan tax year: January 1st to December 31st

Tax rates depends on earnings: (earnings in NT$)
$0 - $370,000 6%
$370,001- $990,000 13% (avg. for teachers)
$990,001 - $1,980,000 21%
$1,980,001 - $3,720,000 30%
$3,720,001+ 40%

Basic Tax Facts:

Some schools use creative ways of manipulating their tax structuring and may not charge you the rates as stipulated above by Taiwanese law, or may pay them out of their own pocket on your behalf, or may ('accidently') charge you too much. The following are common scenarios you may encounter at an average, legal school.

1) If you're single and unmarried the first NT$74,000 you earn is untaxed.

2) Wages are normally taxed at 20% for the first 183 days of a tax year (deducted from

your paycheck.)

3) After 183 days, the rate is reduced to your income level (13% is average for most teachers - see above chart.)

4) Since you overpay by 7% for the first 183 days (assuming you make the average 50-70,000NT p/month), you'll get back the difference when you file your taxes.

5) Taxes for the current year are always filed in May of the next year. If you are planning to leave before May of the next year see info on refunds at bottom of this page.

6) If you stay less than 183 days in any tax year you will still have to pay the full 20% tax rate and will receive no refund. Even if you stayed 182 days, there is NO REFUND. If you arrived on or after July 2nd, there are less than 183 days left in the tax year. No refunds. When you get your (legal) job and ARC, your employer may legally withhold 20% until the end of the year. No refunds. No matter how little or much you earn, since you were here less than 183 days in the tax year you'll have to pay 20%, and you can't get a refund. You start over at zero days on January 1st every year.

7) The counting of days in the tax year is cumulative. Say you stay for 4 months then leave the country for three weeks on vacation, your 4 months will continue to be countable toward your 183 days for the current tax year (the 3 weeks you were away are excluded.)

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The 183 day total is derived by the amount of total time you have been here, regardless of whether you had a job or not. If you were here for 2 1/2 months and then suddenly got a job and an ARC, the previous 2 1/2 months WILL count towards the ‘183 day’ total for refunds.

10) The day count goes by the dates in your passport, except the first day you arrived. If you came on February 1st, but didn't get an ARC until July 3rd, you would have to pay 20% tax (or have it deducted automatically by your employer) for only 1 month. The 183 days are calculated by the date you arrived. Since you arrived 5 months ago, even though you are just getting your ARC and beginning to work, those first 5 months are counted toward your 183 days.

11) If you stayed in Taiwan 183 days in the previous year, and stay into the next year, you do NOT go back to the 20% tax rate. You will remain at the regular rate for your income level (see chart above.)

12) After your first 183 days in a year period, as long as you stay in the country for 183 days each successive year, your tax rate will not go back to 20%.

Necessary Documentation for filing tax returns:

1) A valid passport
2) Tax withholding statement
3) Certificate of residence (ARC)
4) Earnings statement (for services performed in the ROC)
5) Supporting documentation for exemptions and deductions

Refund Checks:

-An income tax refund is available when a tax return is filed.
-If you pay more than you should during the 183 day period, you get a refund.
-If you arrive on or after July 2nd in any tax year (this is the cutoff day for the 183 day minimum required by tax laws for refunds) you will receive NO REFUNDS.
- If you arrived in January and are leaving in December (or at least before May), here are the requirements to get your [spam word detected] since taxes are filed in May of the NEXT year:

Requirements:

1) You may need to find a friend who is a Taiwanese citizen to help you collect your refund the following May.
2) Ask your job's accounting office to prepare your Earnings Statement for you (see below).
3) Go to your local tax office.
-Bring your passport

-Bring your ARC
-Bring your earnings statement from your job.
4) When you go to the office they will ask you to fill out a form and you can calculate your refund on the spot based upon the Earnings Statement you've given them.
5) They will process it and send you a check.
6) If you/your friend live in Taipei, the check will be available within one week.
7) If you/your friend live outside of Taipei, it takes longer.
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The check will be sent to your friend's address.

IMPORTANT NOTE: Your friend's name will be attached to the filing so your friend would be held responsible for any unpaid taxes in the event you have any...