I posted this in a separate thread but since this one seems more active I’m going to try here…
I recently set up a representative office for a US-based corporation. I had no problem setting up the rep office with MOEA. However, the Workforce Development Agency now says I need to show that the US corp has paid-in capital equivalent to at least $500,000NT to get a work permit to hire myself as manager.
Everything I’ve read says that unlike branch offices and Taiwan companies, there are no capital requirements for representative offices as far as work permits go but that you need to show performance records after the first year.
Has anybody else run into this issue? Is it a new thing?
Also, if you have run into this issue, what documents did you use to prove your paid-in capital? WDA couldn’t tell me what specific documents are acceptable so even though my corp meets the requirement the process has become a lot more uncertain.
It depends on you. Do you need it? Taiwan doesn’t care. However, if you’re paying expenses to relating to your rep office, it is more professional to pay them out of an account that is in the name of the rep office.
You can setup an business account for the rep office. The account will have the name of the company and the account holder in the case of Taiwan Bank, which, in my experience, is the easiest bank to setup this kind of account. Most private banks don’t really understand what a rep office is and will push back against opening an account even if you have a business number. Just go to Taiwan Bank.
Actually you can just run the bank transactions through your personal account if the transactions are small in amount and number. But, as I said, if you wanna be totally professional, get a separate account for the rep office. If you have reps other than yourself you can set the account up so multiple people can transact on the account under the primary account holder.
Thanks. That’s my understanding as well but I spoke with multiple people at WDA and they insisted this is the case. Any advice for how to deal with this?
I will make a call tomorrow to check this information. Hopefully, it’s the usual stupidity here where people are not really listening to what you’re saying and assuming you are talking about a branch office.
Btw…I didn’t have time to check your previous posts - what country is your LLC or corporation from and what is your nationality? I’m trying to rule out any biases that I have witnessed here regarding people who have attempted to start businesses here but weren’t from the right country.
I have gained information from competent people in that office.
As I suspected, someone gave both of you the wrong information about capital requirements for a rep office. However, even before I inquired, I thought that it makes no sense for starters, because you ABSOLUTELY CANNOT SELL ANYTHING OR COLLECT MONEY USING A REP OFFICE so no need for your rep office to have capital requirements. I think you know already but there has been some confusion about this. So, as of today, there are still no capital requirements for rep offices; HOWEVER, there will be a delay in processing apps for work permits for rep office managers, because there has been some problems with people establishing rep offices that aren’t legitimate. So, there will be further review of your rep office and application SO make damn sure your app and purpose is legit and follows all rules and regulations concerning the operation of rep offices and its employees in Taiwan.
On a tangent, I will add, make sure that your living expenses in Taiwan are well-documented and that funds flow from your foreign corp to your rep office bank account that account for your expenses. You cannot skip filing income taxes and you cannot state that your income is zero or an unreasonable amount for obvious reasons. Technically, rep office managers don’t need to be paid, but if they are not, then how do you live in Taiwan? So, be careful and keep things reasonable.
Shouldn’t this be the job of the MOEA? I mean if a rep office wasn’t legit, the MOEA shouldn’t have approved it in the first place.
I don’t plan to open a bank account for my rep office in Taiwan. I’ll withdraw fund from my Canadian bank account. I’ll definitely file my income taxes in Taiwan though.
Based on the guide, there isn’t really a minimum salary for the rep. Do you think NT30,000/month is reasonable? The first work permit for a rep office can only be one year?
Yes, you can hire employees. But if you just want to do subcontracting or offshoring, just approach a company which engages in the work you want to be performed and make a contract between your foreign corp and the Taiwanese company facilitated by your rep office. Hiring people here is messy and employing people doesn’t satisfy the performance requirements of the rep. However, a contract does.
Thanks @teacherfei. Idea is to hire some new college/grad school graduates and train them. Per your advice, will search for a local company - wonder how much data science/ML expertise exists here.
Thanks so much @teacherfei . Really nice of you to help.
In case it helps anyone else…my girlfriend made some calls. There is still no capital requirement for rep offices. It appears the person/people assigned to my application were making up their own rules and when a local got involved and started asking questions, my application was processed/approved the same day.
It’s reasonable for the Taiwan authorities to make sure people setting up businesses here are legit but frustrating that this isn’t being done by the book in all cases apparently.
If they WDA is really having issues with rep offices that aren’t legit, why isn’t this being addressed by MOEA? MOEA approves or rejects the creation of the rep offices in the first place.
And if they want to raise the bar for foreigners to employ themselves as the managers of rep offices, they should actually change the law and create an official list of documents that are needed so that business owners have certainty in the process.
If you’re setting up a rep office and run into an issue like this I recommend seeing if a local (friend/SO/spouse/etc.) can advocate on your behalf. And also try calling the WDA HQ in New Taipei City.
Another question: can you get a work permit for a manager of a rep office that lasts longer than one year? If so, how does it work after the first year? Do they contact you at the end of the first year to provide your performance records and cancel the work permit if they’re not satisfied?
