APRC For Entrepreneur / Freelancer

[yuj97oh0]

Hello Folks,

I currently hold a Taiwan Gold Card under the Digital - Salary category.

I am a freelancer in the digital area, offering services like programming, DevOps, etc. All of my clients are from North America and Europe. I work on certain projects for some months and get paid.

I am sorted for the next 2 years thanks to the Taiwan Gold Card, but I am not sure of the path ahead for the APRC.

I read the forum posts and the legal documents around the APRC.

If I understand correctly, after 3 years on the Gold Card, I am eligible under 2 different sections for the APRC.

1. Salary: twice the minimum wage - Even though my yearly freelance income is twice the minimum wage, this is not a salary from a Taiwan company in the strict definition, plus it’s not regular.
2. Assets of $5 million. I won’t be able to satisfy this, sadly.

The only option I can think of is to create a local, one-person Taiwan company and then get employed by my own company.

Clients will remit the amount to my company’s bank account in Taiwan, and I would get a regular salary from it.

I am not sure of the compliance overheads, but I believe I can outsource those to a paralegal/accountant. But what I am mainly worried about is if this will work for the APRC!

Can someone please help me here - Will this one-person company route cause any issues when it comes to the APRC? Or is there any path forward for entrepreneurs/freelancers who have irregular income (satisfying the yearly minimum wage) but not high enough for the $5 million assets?

[qwert_zuiop]

@yuj97oh0

Assets of $5 million. I won’t be able to satisfy this, sadly.

Do note that it’s NT$ 5 million. And it can include FCY balances at a bank in Taiwan. Not US$ 5 million like some people incorrectly assume.

@yuj97oh0

Or is there any path forward for entrepreneurs/freelancers who have irregular income (satisfying the yearly minimum wage) but not high enough for the $5 million assets?

I think there are quite some people in a similar situation as you in the Gold Card thread who successfully converted to a APRC having only freelance income ( @Andrew ?) :

The Employment Gold Card Super-Thread

From Cabinet approves bill to attract skilled foreigners - Taipei Times Cabinet approves bill to attract skilled foreigners - Taipei Times The Cabinet yesterday approved a draft bill relaxing the restrictions on foreign white-collar workers in a bid to attract skilled foreigners for the government’s “Asian Silicon Valley” initiative. The draft bill would relax the regulatory constraints on residence and work permits, taxation, internships, healthcare and retirement benefits. The bill is aim…

APRC After Gold Card - What are the rules?

If we get the APRC thru the GC route, but stay outside of Taiwan for extended periods ( say 2-4 years), do we still need to do any of these: Keep asking for permission to stay abroad every 6 months ( I read this somewhere for some category of aprc) Contribute financially towards some minimum tax, NHI, etc? Any other thing I don’t know ?

@yuj97oh0

The only option I can think of is to create a local, one-person Taiwan company and then get employed by my own company.

It should also work for an overseas company as long as it can pay you a salary. You can then declare this as salary in Taiwan (it counts as Taiwan-sourced as the work was performed in Taiwan).

Another option would be involving an EOR (Employer of record) solution - either through your own company abroad or directly through your customers. However, this could result in fees of US$300+ per month…

@yuj97oh0

Will this one-person company route cause any issues when it comes to the APRC?

I think @Marco went that route: Started a company in Taiwan and eventually converted to APRC. It’s probably the “safest” (i.e. most straightforward) way as you will have “real” local salary. See this thread for details:

Freelance income and APRC application

Hello folks, I will be eligible to apply for my APRC in late 2024, I am currently teaching English at a public elementary school and would easily meet the requirements for the APRC if I stayed in this position until then. I have, however, developed a blossoming online translation side gig which I’d like to pursue and the full time job is feeling more and more distracting from the translation. Obviously freelance translation won’t get me an ARC to fill the last year before the APRC, but I was w…

[qwert_zuiop]

@qwert_zuiop

I think there are quite some people in a similar situation as you in the Gold Card thread who successfully converted to a APRC having only freelance income

Ah, found it:

@Andrew

I just called the Taipei immigration office to check about this. The first person didn’t know and gave me the number for her supervisor.

He said that the tax codes included are 50 (Taiwan salary/wages), 5F (overseas salary/wages), 9A (professional practice income), and 9B (gaofei). (He actually wasn’t sure about 9B and needed to go check with someone else, so hopefully that’s correct!)

So you should be fine just using your freelance income.
Just make sure to use the “correct” code when filing taxes (online filing will should allow you to check this yourself - otherwise, make sure the tax bureau employees / volunteers use the right one!).

[UnderArmor]

Use and EOR and declare twice the minimum wage per year to satisfy the requirement.

[yuj97oh0]

@qwert_zuiop : Thanks for the detailed response.

@qwert_zuiop

Do note that it’s NT$ 5 million. And it can include FCY balances at a bank in Taiwan. Not US$ 5 million like some people incorrectly assume.

Its a typo .. I meant NT$ 5 Million only - which I do not have as of now (Even considering foreign assets )

@qwert_zuiop

It should also work for an overseas company as long as it can pay you a salary. You can then declare this as salary in Taiwan (it counts as Taiwan-sourced as the work was performed in Taiwan).

Unfortunately , I get paid to my personal US Bank account - This is not classified as salary. I have not incorporated a foreign company as of now

@qwert_zuiop

I think @Marco went that route: Started a company in Taiwan and eventually converted to APRC. It’s probably the “safest” (i.e. most straightforward) way as you will have “real” local salary. See this thread for details:

Thanks for this- I will check this

[yuj97oh0]

@qwert_zuiop

So you should be fine just using your freelance income.
Just make sure to use the “correct” code when filing taxes (online filing will should allow you to check this yourself - otherwise, make sure the tax bureau employees / volunteers use the right one!).

This if it works is great !

if I get this right, all i need to do is to declare all my inward remittance as freelance income during tax filing .

My only worry is , the remittance from US Bank account to Taiwan is coming as personal remittance as I am paying myself from my own US bank Account to Taiwan Bank Account . I have invoices and bill proofs though - Hope that will come handy in case Tax bureau asks for proofs ?

To clear off any confusion , my current payment flow is like this

1. I get freelance gigs from individuals
2. I send them invoice or sometimes paypal invoice - Clients from US and Europe pay to my personal US Bank Account or personal paypal account
3. I remit my money from personal US bank account to personal Taiwan Bank Account

[yuj97oh0]

@UnderArmor

Use and EOR and declare twice the minimum wage per year to satisfy the requirement.

Thanks for the response
@qwert_zuiop also mentioned the same - When I did some search for this, the compliance and efforts seems to be too much as its almost considered as a foreign subsidiary .. Am I missing something here ?

[qwert_zuiop]

@yuj97oh0

if I get this right, all i need to do is to declare all my inward remittance as freelance income during tax filing .

You would need to declare all freelance income received (no matter which bank account) with the tax-authorities. Money received for work performed in Taiwan always counts as Taiwan-Sourced. As you seem to be a US citizen, it’s a bit more complicated because you also need to file in the US - but from my understanding, many US citizens can use some kind of foreign income exemption and thus owe no taxes in the US.

Whether or not you remit the money to Taiwan shouldn’t matter. Many foreigners working remotely from Taiwan actually don’t remit their full salary - but keep some in their home country to invest etc (brokers in Taiwan lack behind especially the ones in the US - and US citizens investing in Taiwan-based funds might create a US-tax nightmare for them).

@yuj97oh0

I have invoices and bill proofs though - Hope that will come handy in case Tax bureau asks for proofs ?

The amount and type of proof requested by the tax bureaus varies a lot. Sometimes, they’re fine with bank account statements - sometimes, they even want to see invoices and contracts for freelancers. For US citizens, they even might want to see a US tax return.

@yuj97oh0

When I did some search for this, the compliance and efforts seems to be too much as its almost considered as a forigen subsidiary .. Am I missing something here ?

The EOR would act a bit like a “body-leasing” company. So it would be on the EOR to ensure compliance.