1Q: What are the tax regulations?
◆Every foreign national in Taiwan is obliged to pay taxes. Tax calculations vary depending on whether the foreigner's status is a resident or a non-resident.
How Resident Tax is calculated :
◆If you have lived for a total of 183 days in a tax year, you are recognized as a resident and you can file a tax return at a rate of 5%-40% depending on your income. Your employer is a tax withholding agent in accordance with the law and is required to withhold tax, but the monthly salary income does not exceed NT$40,000 and is exempt from withholding.
Calculation of non-resident tax :
◆If you live for less than 183 days in a tax year, you are recognized as a non-resident, and your employer is the tax withholding agent according to law. If the total monthly salary is less than 1.5 times the basic salary, the tax will be paid according to the salary. 5% of the total salary will be withheld for tax. If the total monthly salary exceeds 1.5 times the basic salary, the tax will be withheld at 18% of the total salary.
◆If you are a domestic care worker or domestic helper, your employer is not a tax withholding agent. When the employer pays wages, the tax will not be withheld. You should declare it yourself, or declare and pay income tax at the withholding rate before leaving the country.
2Q: How do I get my tax refund?
◆If your company has withheld more than your statutory tax in the past year of assessment, the excess tax will be repaid by the end of this year's tax year.
◆The earliest tax refund will start from August and September after the tax declaration, and the IRS will refund the tax by check.
◆Migrant workers are usually required to sign an "authorization to collect tax refunds", and the employer or agent will receive the tax refund check from the IRS. Migrant workers should carefully evaluate whether the employer or the agency is trustworthy and whether they will illegally embezzle the tax refund.
◆When you receive a tax refund from your employer, be sure to check that the refund amount is correct before signing the receipt.