Taiwan's individual income tax (綜合所得稅) runs from 5% to 40% for residents. The key residency threshold is 183 days — residents filing at progressive rates (5–40%); non-residents at 18% flat. Taiwan does not have a wealth tax or inheritance tax for most assets. Dividends from Taiwanese companies are subject to a 20% withholding tax for non-residents. Taiwan's tech industry (TSMC, MediaTek, ASUS) makes it an important destination for tech professionals.
At a glance
Key Facts
Resident Tax Rates
5% / 12% / 20% / 30% / 40% (progressive)
Non-Resident Rate
18% on Taiwan-source employment income
Residency Threshold
183 days in calendar year
Basic Exemption
NT$92,000 per person (2024)
Standard Deduction
NT$124,000 single / NT$248,000 married
Dividend Withholding (Non-Residents)
20%
Capital Gains Tax
Generally none on securities
Official Authority
MOF — Ministry of Finance (mof.gov.tw)
Introduction
Taiwan has a straightforward income tax system with progressive rates from 5% to 40% for tax residents. The critical threshold for expats is the 183-day rule — spending 183 or more days in Taiwan in a calendar year makes you a tax resident eligible for the lower progressive rates. Below 183 days, a flat 18% applies to Taiwan-source income. Taiwan's tech sector dominance (TSMC, MediaTek, Foxconn, ASUS) attracts significant international talent, and understanding Taiwan's income tax system is increasingly relevant for tech professionals, semiconductor engineers, and remote workers.
Net taxable income = gross income minus basic exemption (NT$92,000/person), itemised or standard deductions (standard: NT$124,000 single / NT$248,000 married), and special deductions (salary deduction NT$207,000, disability NT$207,000, etc.).
Effective Rates at Key Income Levels
For a single tech professional earning NT$1.5M (approximately US$47,000): net taxable income approximately NT$1,077,000; effective rate approximately 10–12% — one of the lowest effective rates for professional income in Asia.
Section 02
Non-Resident Tax Treatment
Foreigners who spend fewer than 183 days in Taiwan in a calendar year are non-residents and are taxed at a flat rate on Taiwan-source income:
Employment income: 18% flat on gross income (no deductions)
Business income: 20% flat
Dividends from Taiwanese companies: 20% withholding
Royalties and interest: 20% withholding
Non-residents cannot claim personal exemptions, standard deductions, or special deductions. The 18% flat rate with no deductions often results in non-residents paying more effective tax than residents at equivalent income levels — creating a strong incentive to meet the 183-day threshold for frequent visitors and assignees.
The 90-Day Rule (Historical)
Previously, foreigners staying 90+ days paid a different blended rate. The current system simplifies this to a 183-day threshold with 18% below and progressive rates above. Confirm current rules with the local tax authority as these provisions have changed in recent years.
Section 03
Capital Gains Tax in Taiwan
Taiwan generally does not levy capital gains tax on individual investors' securities transactions. Key points:
Gains from selling shares listed on the Taiwan Stock Exchange (TWSE) and OTC market: exempt for individuals
Gains from unlisted shares: potentially taxable as income (check current rules)
Real estate capital gains: Taiwan has a Housing Tax (房地合一稅) on real estate transactions — introduced 2021
Housing Tax on Real Estate
Since July 2021, Taiwan applies the Housing Tax on real estate gains: properties held less than 2 years: 45% of gain; 2–5 years: 35%; 5–10 years: 20%; 10+ years: 15%. Self-used primary residence: reduced rates (3–10% depending on holding period, with a NT$4M exclusion for long-term owner-occupiers). This replaced the previous complex land value increment tax regime for most residential transactions.
Section 04
Tax Treatment of Dividends for Residents
For Taiwan tax residents, dividends from Taiwanese companies have been subject to different treatment over time. From 2018:
Residents can choose between: (A) Include dividends in gross consolidated income at progressive rates with a 8.5% offsetting credit (capped at NT$80,000), or (B) Separate flat tax of 28% on dividend income
The choice depends on the individual's marginal rate — those in the 20% or lower bracket typically benefit from option A; those in 30–40% brackets may prefer 28% flat
For non-residents: 20% withholding on dividends, final tax, no further obligation. DTA reduced rates may apply depending on treaty country.
Section 05
Tax Residency and Filing
183-Day Rule: You become a Taiwan income tax resident if you reside in Taiwan for 183 or more days in a calendar year. Days of arrival and departure count as full days. You need not have a permanent address — physical presence determines residency.
Filing Requirements
Tax year: January 1 – December 31
Annual filing (綜合所得稅申報): May 1 – May 31 each year
Online filing via eFiling system (tax.nat.gov.tw) or in person at National Taxation Bureau offices
Non-residents with Taiwan-source income above withholding: should confirm if further filing needed
Employers deduct monthly withholding at source. Annual filing reconciles the withholding with actual liability. Most PAYE employees with simple affairs receive a refund or pay a small balance. Self-employed and those with investment income must file regardless of employer withholding.
Section 06
Working in Taiwan's Tech Sector
Taiwan's semiconductor and tech industry (TSMC, MediaTek, ASE Technology, ASUS, Acer, Foxconn) attracts significant international talent. Key considerations for tech expats:
Taiwan's effective income tax rates are competitive — a software engineer earning NT$1.5M (~US$47K) faces ~12% effective income tax
Labor pension (勞退): 6% employer contribution to employee's individual account; employees can voluntarily contribute additional 0–6%
National Health Insurance (NHI): approximately 5.17% of salary; employer pays 60%, employee 30%, government 10%
APRC (Alien Permanent Resident Certificate): available after 5 years of legal continuous residence; provides open work rights
Employment Gold Card: Taiwan's priority visa for high-skilled professionals — simplifies residency and offers various government-supported benefits
Taiwan's low effective income tax rates on professional incomes (below those of Japan, Korea, or Australia at comparable levels) make it a relatively tax-efficient location for tech professionals in Asia.
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What is the 183-day rule in Taiwan for income tax?
Taiwan uses a 183-day presence test as the primary trigger for tax residency. If you spend 183 or more days in Taiwan in a calendar year (January 1 – December 31), you are taxed as a resident at progressive rates (5–40%) with access to personal exemptions and deductions. If you spend fewer than 183 days, you are a non-resident and your Taiwan-source income is taxed at a flat 18% (for employment) without deductions. Days are counted based on physical presence — partial days on arrival and departure both count as full days.
Q
Is there capital gains tax on stocks in Taiwan?
Generally no — individual investors' gains from selling shares listed on the Taiwan Stock Exchange (TWSE) or Taipei Exchange (TPEx) are exempt from capital gains tax in Taiwan. Taiwan abolished its securities transaction income tax for individuals, and the current system exempts most stock market gains. Gains on unlisted or OTC shares outside the exchanges may be treated differently. Real estate gains are subject to the Housing Tax (房地合一稅) at 15–45% depending on holding period. Dividend income is taxable (at progressive or flat 28% rates for residents; 20% withholding for non-residents).
Q
How does Taiwan's National Health Insurance (NHI) work?
Taiwan's National Health Insurance (全民健康保險, NHI) is a universal single-payer system covering all residents including foreigners legally residing in Taiwan. Coverage begins after 4 months of residency (or immediately for employment pass holders). Premiums are income-based: employee contribution approximately 2.35% of insured salary; employer pays approximately 5.17% total (employer portion ~3.5%, employee ~2.35%). The premium is calculated on a standard insured salary amount, not total compensation. Taiwan's NHI is consistently ranked among the world's best — hospital and clinic access is universal, costs are very low (NT$100–500 for most doctor visits), and wait times are generally short.
Q
What is Taiwan's Employment Gold Card?
Taiwan's Employment Gold Card (就業金卡) is a combined work permit, resident visa, and alien resident certificate for high-skilled foreign professionals. Eligibility: professionals in designated fields (technology, finance, healthcare, law, education, arts and culture, sports) with minimum income or professional credentials. Benefits: 3-year open work rights (no employer sponsorship needed); simplified residency; tax incentive — 50% of employment income above NT$3M is excluded from taxable income for a 3-year period (a significant benefit for high earners). Application: via the Gold Card Office website. This is one of Taiwan's most effective tools for attracting international tech talent.
Q
Does Taiwan have a Double Taxation Agreement with the UK or USA?
Taiwan does not have a formal double taxation agreement with most major countries because its official diplomatic status is contested globally. The US does not have a standard DTA with Taiwan (Taiwan is not a UN-recognised state and the US formally recognises the People's Republic of China). The US-Taiwan Tax Agreement (1998) provides some protections but is not a comprehensive DTA. The UK similarly lacks a standard DTA with Taiwan. In practice, foreign tax credit mechanisms in the resident's home country (FEIE/FTC in the US; FTC in the UK) provide relief from double taxation on Taiwan-source income. Taiwan has signed tax agreements with some countries through unofficial channels.
Disclaimer:This guide provides general information about Taiwan taxation for educational purposes only. Tax rules change frequently and individual circumstances vary. Always verify current rates and thresholds with the Ministry of Finance Taiwan (mof.gov.tw) or a qualified Taiwan tax adviser. This is not tax advice.