Taiwan is home to more than 23 million people and has strong technology and service industries. For companies looking to expand in Taiwan, there are many types of company formations that can be established including limited liability, branch or representative offices. Companies must register with the Taipei National Tax Administration and the Ministry of Finance to obtain a Company Internal Revenue Department Number. Companies have to also register with the local Social Insurance, National Health Insurance, and Labor Insurance to manage employee benefits.

Payroll and Tax Considerations in Taiwan:

  • All employees must receive wages higher than the minimum basic wage or TWD 24,000 per month or TWD 160 per hour
  • Overtime is paid as follows; if it does not exceed 2 hours, employees are paid 1/3 of regular wage, and if the overtime is over 2 hours but less than 4, employees receive 2/3 of regular wage
  • The labor law mandates that an employer who terminates an employment contract generally needs to provide severance pay to the employee. The amount varies based on job type
  • Income tax rates range from 5-40%
  • Employers must prepare and maintain worker attendance records for 5 years. The attendance records must record the attendance of workers daily and to the minute

HR and Statutory Requirements:

  • Annual leave is granted according to the number of years of service
  • Sick leave varies depending on the condition and if hospitalization is required. If the sickness or injury occurs on the job the employer must compensate for any necessary medical expenses
  • Female employees receive 8 weeks of maternity leave. Employees who have worked for more than 6 months are paid 100% of their regular salary during maternity leave, and those who have worked for less than 6 months are paid 50% of their regular salary
  • New fathers receive 5 days of paid paternity leave
  • There are 3 types of social security schemes: Labor Insurance, Labor Pension, and National Pension

Holidays in Taiwan

  • January 1 – Republic Day / New Year’s Day
  • January 31 – Chinese New Year’s Eve
  • February 1 – Chinese New Year’s Day
  • February 2 – Chinese New Year Holiday
  • February 3 – Chinese New Year Holiday
  • February 4 – Chinese New Year Holiday
  • February 5 – Chinese New Year Holiday
  • February 28 – Peace Memorial Day
  • April 4 – Children’s Day
  • April 5 – Tomb Sweeping Day
  • May 1 – Labor Day
  • May 2 – Labor Day observed
  • June 3 – Dragon Boat Festival
  • September 10 – Mid-Autumn Festival
  • October 10 – National Day

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