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Payroll and Benefits Guide Taiwan

Last updated: Feb 04, 2024

Currency
New Taiwan Dollar (TWD)
Employer Taxes
18.202-20.312 %
Payroll Frequency
Monthly
Employee Costs
4.651%
Capital
Taipei
Date Format
yyyy/mm/dd
Fiscal Year
1 January - 31 December
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Contribution

Employer
Employer Payroll Contributions
8.40%
Labor Insurance
0.7%
Employment Insurance
6.00%
Pension Fund
3.102%
National Health Insurance
2.11%
National Health Insurance -Supplementary Premium
18.202-20.312 %
Total Employment Cost
Employee
Employee Payroll Contributions
2.40%
Labor Insurance
0.20%
Employment Insurance
1.551%
National Health Insurance contribution is applied on income between 27,470 TWD and 219,500 TWD.
4.651%
Total Employee Cost
Employee Income Tax
5.00%
Up to 590,000 TWD
12.00%
590,001 TWD – 1,330,000 TWD
20.00%
1,330,001 TWD – 2,660,000 TWD
30.00%
2,660,001 TWD – 4,980,000 TWD
40.00%
4,980,001 TWD and above
Non Resident Income Tax
6%
Up to 41,205 TWD
20%
Above 41,205 TWD

*The Minimum withholding tax threshold for monthly incomes, part-time and non-monthly incomes is 88,501 TWD

* Any employer shall not discriminate against any disabled candidates or refuse employment due to their disability. In accordance with the provisions of Paragraph 2 of Article 38 in the “People with Disabilities Rights Protection Act,” any company with fewer than 67 employees shall employ people with disabilities at numbers no less than 1% of the total number of employees and shall not be less than one person. Failure to do so will subject the employer to make a contribution to the Disabled Employment Funds, the contribution amount is based on the required number of disabled employees multiplied by the statutory monthly minimum wage.

The employer is not required to report the recruitment of employees with disabilities to the government. The government will obtain such information from the enrollment of social insurance for such employees.

Employer taxes

Highest
Lowest

Employee taxes

Highest
Lowest

Minimum Wage

General

For persons paid by the month, the minimum monthly wage is TWD 27,470. The hourly minimum wage is TWD 183.

MINIMUM WAGE (PER MONTH)

Highest
Lowest

Payroll

Payroll Cycle

The payroll cycle in Taiwan is generally monthly and payments are usually paid on the 15th of each month.

13th Salary

Although it is not mandatory, often 13th and 14th-month salaries are provided and paid before the Chinese new year. Festival bonus is also common before the Dragon Boat Festival and Mid-Autumn Festival.

Authority Payment  Dates Methods

國稅局

Tax Authority

Monthly; Due by the 10th of the following month.

Payment amount withdrawl from local bank account to pay the tax.

健保局

National Health Insurance Bureau

Monthly; Due by the 15th of the next 2 months.

Ex. January premium, due date will be March 15th.

Option 1: Payment amount withdrawl from local bank account to pay the premium.

Option 2: Auto deduction from local bank account (need to submit the applications to the authority and bank).

健保局

National Health Insurance Bureau

Monthly; Due by the 15th of the next 2 months.

Ex. January premium, due date will be March 15th.

Payment amount withdrawl from local bank account to pay the premium.

勞保局

Labor Insurance Bureau

Monthly; Due by the 15th of the next 2 months.

Ex. January premium, due date will be March 15th.

Option 1: Payment amount withdrawl from local bank account to pay the premium.

Option 2: Auto deduction from local bank account (need to submit the applications to the authority and bank).

勞保局

Labor Insurance Bureau

Monthly; Due by the last date of the next 2 months.

Ex. January pension, due date will be March 31st.

Option 1: Payment amount withdrawl from local bank account to pay the premium.

Option 2: Auto deduction from local bank account (need to submit the applications to the authority and bank).

Working Hours

General

The maximum number of working hours are eight hours per day and 40 hours per week, up to a maximum of 12 hours per day, inclusive of overtime. In Taiwan, it is mandatory to have two days off every seven days. One of these days off is compulsory and the other day is flexible and can be worked and paid as overtime.

Overtime

Work in excess of the standard weekly working hours is considered overtime and is regulated by the employment contract or collective agreements.
The employer must pay overtime as follows:

  • First two hours of overtime: 134% of the regular salary rate
  • Following two hours of overtime: 167% of the regular salary rate

Employees can work a maximum of 12 hours per day including overtime and a total of 36 overtime hours per month.

Leave

Annual Leave (vacation)

The employment contract determines paid leave in Taiwan as dependent on the completed years of service.
Annual leave is accrued as follows:

  • 6 months to less than 1 year of employment: 3 days’ paid leave
  • 1 year of employment: 7 days’ paid leave
  • 2 years of employment: 10 days’ paid leave
  • 3 years of employment: 14 days’ paid leave
  • 5 years of employment: 15 days’ paid leave
  • One additional day is provided for each year of service following the completion of 10 years (to a maximum of 30 days)

Public Holidays

Holidays falling on Sundays are usually moved to another day in lieu.

Date Day Holiday Notes
1 Jan 2024 Monday Founding Day of the Republic of China
8 Feb 2024 Thursday Chinese New Year
9 Feb 2024 Friday Chinese New Year
10 Feb 2024 Saturday Chinese New Year
11 Feb 2024 Sunday Chinese New Year
12 Feb 2024 Monday Chinese New Year
13 Feb 2024 Tuesday Chinese New Year
14 Feb 2024 Wednesday Chinese New Year
28 Feb 2024 Wednesday Peace Memorial Day
4 Apr 2024 Thursday Tomb Sweeping Day
5 Apr 2024 Friday Tomb Sweeping Day Holiday
1 May 2024 Wednesday Labor Day
10 Jun 2024 Monday Dragon Boat Festival
17 Sep 2024 Tuesday Mid-Autumn Festival
10 Oct 2024 Thursday National Day

Sick Days

There are two types of sick leave in Taiwan. For employees who are sick but do not require hospitalization, sick leave entitlement is 30 days per year paid at 50.00% of the regular salary rate. When an employee’s sickness is covered by labor insurance and there’s a difference in the amount due and the regular salary rate of pay, the employer must pay the difference.
Sick leave entitlement increases to twelve months when the employee is hospitalized.

Taiwan’s government will stop covering the COVID-19-related medical expenses of foreign nationals without National Health Insurance (NHI) cards from 2024.

Maternity Leave

Employees are entitled to eight weeks of paid maternity leave at 100.00% of the regular salary rate of pay for employees with a minimum of six months of employment. If the employee has not been employed for the minimum period, maternity pay reduces to 50.00%.
In addition, pregnant employees are entitled to five days’ leave prior to birth for medical check-ups.

Paternity Leave

Employees are entitled to seven days of paid paternity leave at the rate of 100% of the regular pay.

Parental Leave

Employees may apply for parental leave after being in service for six months. The period of this leave is until their children reach the age of three years old but may not exceed two years. When employees are raising over two children at the same time, the period of their parental leave shall be computed aggregately and the maximum period shall be limited to two years received by the youngest child. The parental leave allowance shall be 60% of the insured person’s average monthly insurance salary six months prior to the month the person went on parental leave. For each child, the parent may, on an aggregated basis, receive a maximum of six months’ allowance. This allowance is covered by the Bureau of Labor Insurance. To request this leave the worker should file an application in writing 10 days in advance.

Other Leave

Bereavement Leave – In the event of the death of an immediate family member (parent, foster-parent, step-parent, spouse) a worker shall be entitled to 8 days of funeral leave with pay. On the death of grand-parent, son or daughter, parent of spouse, foster-parent or step-parent of spouse, a worker shall be entitled to 6 days of funeral leave with pay. On the death of great-grandparent, brother or sister, grand-parent of spouse, a worker shall be entitled to 3 days of funeral leave with pay.

Marriage Leave – A worker is entitled to 8 days of wedding leave with pay.

National Service –  is official leave with pay granted to an employee who is required for education or duty of national service.

Leave for Personal Matters – Workers may take up to  14 days of unpaid leave annually to deal with personal matters.

Vacation Days
Public Holidays
Highest
Lowest

PAID MATERNITY LEAVE (DAYS)

Highest
Lowest

Termination

Termination Process

It is common to use a mutual term agreement to end the employment relationship. The terms of this agreement vary case by case.

An employer can terminate an employment contract with notice (or with pay in lieu of
notice) and with severance pay only in one of the following circumstances:
● Stoppage of business or a transfer of ownership.
● Business losses or curtailment of business operations.
● Suspension of operations for more than one month due to a force majeure event.
● Alteration of the business nature, forcing a reduction in the number of employees
where those employees cannot be reassigned to other suitable positions.
● The employee is incapable of performing the tasks assigned.The employer must
give the former employee proof of termination of the employment contract and
documentation regarding the last day of work. The employee and employer
should both sign these documents.
An employer can terminate an employment contract without advance notice or severance
pay only in one of the following circumstances:
● Misrepresentation of the facts by the employee at the time the labour contract
was signed which leads, or may lead, to the employer suffering damage.
● Acts of violence by the employee against the employer, the employer’s family or
representative, or other employees.

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Taiwan
● Serious breaches by the employee of the employment contract or work rules.
● The employee has been sentenced to temporary imprisonment in a final
judgment, which cannot be suspended or commuted to a fine.
● Purposeful damage or abuse to the employer’s property by the employee.
● Intentional disclosure by the employee of the employer’s technological or
business secrets.
● The employee’s absence from work for three consecutive days, or for six days in a
month, without justifiable reason.
The minimum period of notice required for an employer to terminate an employee:
● Employed for more than 3 months, but less than 1 year: 10 days’ notice.
● Employed for more than 1 year, but less than 3 years: 20 days’ notice.
● Employed for more than 3 years: 30 days’ notice.

Notice Period

The minimum period of notice required for an employer to terminate an employee:
● Employed for more than 3 months, but less than 1 year: 10 days’ notice.
● Employed for more than 1 year, but less than 3 years: 20 days’ notice.
● Employed for more than 3 years: 30 days’ notice.
Once an employee has received notice, the worker may ask for leave during work hours
(not more than 2 days a week), for the purpose of finding a new job. During this time the
employee must still receive their wages.
If an employer dismisses an employee without providing the requisite notice period, the
employer must pay wages for the whole notice period.

Severance Pay

Generally, severance is 50% of the average monthly pay per year of service, up to a maximum of six months’ pay. For foreigners and local employees that are still under the LSA pension system, severance is one month’s average pay for each year of service.

Probation Period

In Taiwan, there isn’t a predetermined probation period. The Act gives the flexibility to employers and employees to decide the length of the probation period. There isn’t a maximum limit for this duration. However, typically, the probation period is set for 3 months.

Common Benefits

  • Leaving service benefits (LSB)
  • Life, accident, and business travel insurance
  • Housing allowances – Mainly provided to expatriates and some senior-level executives and are included in taxation. Most multinational companies provide these enhanced benefits to attract and retain local talent.
  • Meal Allowance – No legally mandated amount of meal allowance, employers can decide on their own policy.  Non-taxable within TWD 3,000 per month.
  • Medical benefits – Optional, supplemental medical plans extended to employees’ spouses and dependent children.

VISA

VISA

Work permits are issued by the Council of Labor Affairs (CLA) upon request from a Taiwanese employer.
Work permits are valid for up to three years, although an employer can apply for an extension on behalf of an employee, which the employer should submit within four months of the expiration date. When an employee changes employers after arriving in Taiwan, the new employer must apply for a new work permit. In addition, the previous employer must apply to have the original work permit canceled with the Council of Labor Affairs.
When the permit is issued in a foreign country, it must be verified by a representative from a local Taipei Economic and Cultural Office or Taiwan representative office in the country which issued it.
There is an approved list of employment for foreign nationals in Taiwan, including school or foreign-language teachers, specialized or technical experts, a director, executive, or manager of a business set up by or invested in by a foreigner.

Remote Work

The Government of Taiwan passed a work from home regulation requiring employers to provide remote employees with the necessary tools and equipment to perform the job which should include the use of ergonomically sound work equipment and up to date software on electronic devices.
Employers are required to pay for any maintenance of such tools and equipment as needed and provide education and training on mental and physical health to ensure the wellbeing of their remote employees.

VAT

General

5% standard rate.

Stay up to date on payroll & employment law changes

Version History

February 4, 2024
Income tax Brackets have been updated
February 4, 2024
The minimum wage in Taiwan has been updated and is now TWD 27,470.
July 5, 2023
Employer contributions have been updated.
May 3, 2022
Payroll contributions and personal income tax rates have been updated.
January 11, 2022
Minimum wage increased to 25,250 TWD a month and 168 TWD per hour.
Payroll contributions and personal income tax rates have been updated.
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Questions & Answers

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Russell
Russell
3 years ago

Is it legal to hire “temporary workers” for short term jobs or do contracts have to be open-ended?

Alex Margolin
Editor
Alex Margolin
3 years ago
Reply to  Russell

Yes, it is legal to hire people for fixed-term contracts for short term employment, seasonal work, or any type of short terms tasks. However, it is always a good idea to consult with an expert about local laws on employee classification to avoid misclassification error.

Jeet
Jeet
2 years ago

Hey, is it Mandatory to pay first salary to the new hire employee in same month or can we pay in following month.

Erez Greenberg
Erez Greenberg
2 years ago
Reply to  Jeet

Hi, it depends on what has been agreed upon by both parties and what is in the labor contract but generally, salaries are paid the same month an employee starts. For example, the contract would state the day of the month salaries are paid, then as an employer, you would need to meet that obligation.

Lia
Lia
2 years ago

Bonus payment to TW employees, can we pay amount with decimals? or need to round up to nearest dollar?

Alex Margolin
Editor
Alex Margolin
2 years ago
Reply to  Lia

Hi Lia, it is a common practice to give employees in Taiwan a bonus as a “13th salary” before the Lunar New Year. But it is not mandated by law unless it is part of the employee’s contract. Therefore, how you choose to award the bonus is up to you, unless specified within the contract.

Swapnil
Swapnil
2 years ago

As per my employment contract, I am eligible for 5 days leave after completion of 6 months. I have completed 6 months but my employment contract is ended and not renewed. Am I eligible for the payment for 5 days of annual leaves?

Alex Margolin
Editor
Alex Margolin
2 years ago
Reply to  Swapnil

In general, when an employee has unused leave at the time of termination, it is paid to the employee. In specific cases, the contract might stipulate the obligations of the employer.

Wesley
Wesley
2 years ago

Hello I would like to know if I worked at a company with a contract that says I work on an average of 9/9.5 hours and after 4 months and 7 days, they terminated my contract. They are only paying me 4 extra days but in accordance to the labor standards, isnt it 10 working days? They are also paying it by hours so if you don’t work, you don’t get paid. I would like to know as from the time I worked here, they have NEVER calculated the salary correctly as they first used a outsourcer from Ukraine and then used a PHP office for the payroll.

Emily Kuhnert
Emily Kuhnert
2 years ago
Reply to  Wesley

Hi Wesley, thank you for your question. Can you please provide more information? How many days a week do you work? The 4 extra days- can you please clarify? Is this meant to be severance or payout for notice?

Janet
Janet
2 years ago

Which holidays in Taiwan should be paid double?

Erez Greenberg
Erez Greenberg
2 years ago
Reply to  Janet

According to the Ministry of Labor “Article 37 of the Labor Standards Act and Article 23 of the Enforcement Rules of the Labor Standards Act, employers are required to allow their employees to take paid time off on annual commemorative holidays, the Labor Day, and other holidays prescribed by the central competent authority (national holidays, such as the Chinese New Year (the 1st, 2nd and 3rd of the first month of the lunar calendar), the Peace Memorial Day, the Tomb Sweeping Day, and so forth). Employers who acquire the consent of workers to work on any of such holidays are required to pay double wages.”

jess
jess
1 year ago

for the severance pay is it on the law of taiwan that employer must pay his or her employee once finished contract?

Erez Greenberg
Erez Greenberg
1 year ago
Reply to  jess

Are you referring to the ending of a fixed-term contract? If yes, then typically an employer does not need to pay severance if it ends at its agreed time. If it ends at an earlier date than agreed, a severance payment might be required.

Larry
Larry
1 year ago

Just want to ask,do i receive benefits from labor insurance?because i had accident during work.it happens on march 1 and im hospitalized for 1 week because they need operation on my wrist and elbow.now im undergoing for my scheduled checkup.

Erez Greenberg
Erez Greenberg
1 year ago
Reply to  Larry

It depends on if you are covered. You can check here to see https://www.bli.gov.tw/en/0011965.html. If you are covered, you can check the following link to see what type of benefits you are entitled to. https://www.bli.gov.tw/en/0007459.html

Larry
Larry
1 year ago
Reply to  Erez Greenberg

Sir,yes im covered because i am factory worker in company. Do you have idea if how much will i receive?Because now i was not able to go work for three months.as per doctor advice for my healing process.(they installed three iron plates to my broken bones)

thankyou
thankyou
1 year ago

The minimum wage that is 25,250 every month with 30 days and what about the month has a 31 days?

Erez Greenberg
Erez Greenberg
1 year ago
Reply to  thankyou

The minimum wage is the same for months with 30 or 31 days.

John
John
1 year ago

The minimum wage 25,250NT is base in Gross monthly income or Net monthly income? What if an employee is receiving lower than minimum wage based on her Net monthly income, is this acceptable or considered illegal?

Emily Kuhnert
Emily Kuhnert
1 year ago
Reply to  John

Hi John, thank you for your question. The monthly minimum wage is the gross amount, so as long as what the employee is receiving is equal to or more than this amount before taxes are deducted, this is perfectly legal.

Ana
Ana
1 year ago

is it ok to change Saturday overtime to fixed holiday and Sunday overtime change to rest day overtime?

Erez Greenberg
Erez Greenberg
1 year ago
Reply to  Ana

Depending on the job of the worker, for example, whether they are a manager, supervisor, etc., they may have more flexibility in setting their working hours. Employees in other job types cannot work more than eight hours a day (not including overtime) and no more than 40 hours a week. They must have at least two rest days every seven days, with one mandatory day off and one flexible rest day. A mandatory rest day cannot be worked by an employee. It is possible for the employee to work on the flexible rest day, but overtime rates will be higher. In the employment contract, shifts/days and weekends should be agreed upon.  

Sze
Sze
1 year ago

Is income tax deducted monthly from your salary ? Even when you stay more than the 183 days ?

Erez Greenberg
Erez Greenberg
1 year ago
Reply to  Sze

Yes, in Taiwan, if you stay in the country for more than 183 days in a tax year, you are considered a resident for tax purposes and are subject to Taiwan’s income tax laws. This means that your employer is required to deduct income tax from your salary on a monthly basis, regardless of how long you stay in the country.

The amount of tax you owe will depend on several factors, including your salary, deductions, and exemptions, as well as any applicable tax treaty provisions between Taiwan and your home country. It’s recommended to consult with a tax professional or the Taiwan National Tax Administration for more information on the specifics of your tax situation.

Tina
Tina
10 months ago

Payment on the 15th of each month. Is this payment for the month prior or for the current month?

Enny Shmurin
Admin
Enny Shmurin
9 months ago
Reply to  Tina

It is likely for the prior month. Common to pay between the 25th – 31st of the month or by the 5th of the following month.

Howard
Howard
10 months ago

Is it legal for an employer to conduct or schedule trainings outside of working hours and not let the employees file it as Overtime?
What section/article of the Taiwan’s Labour Standard is this under?

Enny Shmurin
Admin
Enny Shmurin
9 months ago
Reply to  Howard

Generally, if the training is related to the position of the worker and it is mandatory, it likely that the worker would be compensated for such training. However if this an optional or not related training then it may not be considered as part of their work.

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Payroll and Benefits Guide
in Taiwan

What’s covered in this guide:

  • Employer/employee contributions
  • Minimum wage
  • Working hours
  • Visa requirements

And more...

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Public Holidays Calendar

Taiwan
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ICS
Date Day Holiday Notes
1 Jan 2024 Monday Founding Day of the Republic of China
8 Feb 2024 Thursday Chinese New Year
9 Feb 2024 Friday Chinese New Year
10 Feb 2024 Saturday Chinese New Year
11 Feb 2024 Sunday Chinese New Year
12 Feb 2024 Monday Chinese New Year
13 Feb 2024 Tuesday Chinese New Year
14 Feb 2024 Wednesday Chinese New Year
28 Feb 2024 Wednesday Peace Memorial Day
4 Apr 2024 Thursday Tomb Sweeping Day
5 Apr 2024 Friday Tomb Sweeping Day Holiday
1 May 2024 Wednesday Labor Day
10 Jun 2024 Monday Dragon Boat Festival
17 Sep 2024 Tuesday Mid-Autumn Festival
10 Oct 2024 Thursday National Day