Clobbered twice on income tax

Last year the company I worked for went bankrupt before issuing the official year-end tax deduction payment slip that is required for filing a tax return in Taiwan. I did have all twelve of my pay slips from last year, though, with the company’s official chops in red ink on them. I was told that even though I didn’t have the tax deduction slip, I could use the pay slips to file my tax return. I went to file my return at the beginning of April. Nice and early.

Unfortunately, the tax office employee did not agree that the pay slips were enough and said that I could have made the chops myself and forged the pay slips. At the time I thought that was a fair enough comment, but what could I do about it? Since then I have found out that the chops are officially registered and could therefore be verified if the employee had been bothered. Or she could have told me to get some form of verification. She told me she would have to check whether my company had paid my taxes and then she could complete the return. In the meantime she worked out what I would have to pay / what I would be refunded based on the pay slips and that way I would at least have evidence that I had visited the office to attempt to file a return.

I called her again at the end of May, before the tax filing deadline and she told me to come in after the deadline and talk to her personally. She was incredibly polite and helpful, but she said my former company had not been submitting tax payments to the tax office and she could not accept my tax return. I would have to pay the tax myself. She helped me out with as many deductions as possible, but I still had to pay NT$40,000, despite the fact that my former company had deducted well over NT$60,000 from my salary - just NT$2,000 or so short of what I was required to pay. Of course I paid as I did not want any interest to build up, nor did I want to render my ARC invalid. I also plan to apply for permanent residency in two years and do not want to have a black mark on my tax record.

But surely I cannot be held responsible for my employer defaulting on tax payments? Surely the pay-as-you-earn system that exists in Taiwan protects the employee, otherwise why would anyone permit their employer to deduct tax for them when the individual is held ultimately accountable? You might think, but at my new company I have asked the accountant to return all tax deducted and to stop deducting it from me in case this situation arises again. If I am ultimately responsible, I will take care of my own tax. But apparently each company is legally obliged to deduct tax on its employees’ behalf. So how is it that I and not my former employer was held responsible? Was it a case of the tax office employee deciding the correct course of action was too much trouble and therefore forcing me to solve the problem quickly by paying the tax myself? And is there any way in which I can get the money back?

Two other employees at my company had completely different experiences. One took a Taiwanese lawyer friend to the tax office and was given his receipt with little fuss. Another was told he could file just one month’s salary and pay tax on that. At least he would have a receipt. How can the application of the law be so arbitrary?

I can’t believe I am the only one that has been clobbered twice on income tax. My company was not the only one to go bankrupt last year. Does anyone know what I can do? Is there an (affordable) appeal process that I can go through? Or does anyone have an experience to share?