My employer withheld 20% tax from my pay. I found out that they didn’t report my taxes or withholding to the tax office. So they took my money and didn’t report it. I have asked for a monthly statement every month but didn’t receive one. I do have my salary directly deposited so I have that record. However the amount deposited is the amount after the 20% withholding.
My gf called the tax office asking how I could file early and informed them that my employer hasn’t given me a tax statement. The tax office called my boss and my boss admitted to not reporting my taxes. Am I going to be able to recover my money? I don’t know what step to take next if my boss is dumb enough to falsify my salary or with holdings.
Is there some way I can prove that my employer withheld 20%?
I would really like to find a new school for my ARC but it seems like switching to a new school for the ARC would be difficult. I am sure that the boss may try to terminate me but I have been a good employee and the students/parents like me. There have just been too many things wrong with this school and I want to switch to a different school without having to get a new visa and go through the whole ARC process again. If the boss does terminate me wrongfully is there anything I can do about it? How long would I have to find a new job before having to do a Visa run?
Well, I’m no expert on this, but offhand, my advice would be to first ask the tax office whether they will be forcing the boss to remit that 20% to them. If so, then you’re ok, as a portion of that will be refunded to you when you file your taxes (or rather, by August 11 or so when the refunds are processed. If not, ask the tax office what they recommend doing next; but presumably the boss will have to remit it and file to avoid getting in big trouble with them.
Do you have a signed contract with him for the full amount of payment? If so, the withholding is evident from the difference in the bank deposits and the contract amount.
Go for it. Do it early so you don’t run out of time. There are threads about how to do this, I believe – have a look.
The small hassle will be worth it in the long run. As you say, this isn’t the only thing wrong with this school.
For changing to another school, you are now legally able to add a second teaching job to your ARC. Do that, and then once the 2nd job is on there, you can hand in your notice at the first one and extend your hours at the second one. That way the transfer will be done before your current boss can make trouble for you.
It might also be worth giving the CLA a call so at least something is on record should you need it later.
Be prepared for your boss to expect you to collude with him in filing a false declaration of your income. For example, he’ll want to understate your earnings by about half so that he can get off paying less taxes to the government. But that ends up taking away from your refund since he already stole 20% of “withholding” from your monthly pay. The only way you can make your boss report truthfully is if you inform the tax department what your total earnings were and exactly how much was withheld from your taxes for the entire year. Did you work every month in 2008? Did your employer withhold 20% for taxes for the first 6 months and then only withhold 10% for the remaining 6? Or did he just conveniently withhold 20% for the entire January through December time frame? If you allow him to falsely declare your income and his withholding of your income, you would only be stealing from yourself. Watch out! He will try to justify this by saying something like, "Hey, I gave you such a high hourly rate because we weren’t going to claim taxes on you, if I had known you wanted to file taxes I would have paid you a lesser hourly rate of pay.
You see. Taiwanese people expect you to pay for their taxes. If you want a tax form for employment you will get paid less. If you want a proper receipt for the purchase of a good, say a TV, then you will pay a little more to cover the tax burden for the seller. If you want to claim your rent payments on your apartment come tax time, your landlord will make your monthly rent higher, because no Taiwanese ever wants to pay taxes on any of their income and especially any income derived from renting one of their apartments and they’ll do anything to avoid it. They do not call this tax evasion here and they don’t consider it a criminal act. They sanitize it by calling it, “Saving tax money”!:fume:
Lastly, when it comes time to apply for permanent residency and your income statements and your tax withholdings do not match. You will be denied!
Here are some true life first hand tax issues I’ve dealt with since coming to Taiwan. There are so many, so I just picked my favorite ones.
The first two months I worked for a buxiban before my ARC came through, I was still withheld at 20% and come tax time, that 20% from the first two months of my employment weren’t added into my earnings statement. The employer tried to pocket that money. When I brought it up, I got the money back, but it was, “Just an honest mistake”. Yeah, right.
Before I bought my own house, all of my landlord’s wouldn’t give me a tax document so I could claim my rent payments to lesson my tax burden. They all said that they would give me the form and I could claim the rent payments for the year, but first I would need to give them $2000 per month extra for the last 12 months ($24,000) to cover their tax burden for declaring my rent payments to them as taxable income.
I opened a coffee shop. The owner would not give me the documents necessary to obtain a business license for her premisis because she didn’t want to pay income taxes on it. I had to declare a portion of my home as a business so that I could get a business license and pay taxes on my coffee shop business. Although I paid my taxes and declared all of my income on the coffee shop, it was still all illegal because the coffee shop wasn’t in my living room.
A woman came to my school looking for 1 on 1 lessons. She wanted me to give her in invoice in the name of a woman that worked for her husband’s company and falsely declare that Ms. X was taking English lessons at my school instead of her. Her husband’s company would pay for Ms. X’s English lessons (actually the owner’s wife), and the company could take a tax break. I declined to do this and the woman was really pissed off about it. When she asked me why I wouldn’t do it, I told her it was tax evasion and illegal. She insisted that it wasn’t in anyway illegal and that it was just a way to “Save tax money”. I told her ok…so then if I report to the tax bureau and let them know this arrangement they will be ok with it, right? She scowled at me, said something under her breath about “Lousy foreigners” and walked out.
[quote=“Okami”]Talk to the tax office and the CLA, two organizations that get things done efficiently and fast.
His big problem guys is he can;t get another ARC without a tax statement. If he has quit his first job, he’s what we called “screwed”[/quote]
Thanks for pointing this out Okami. I haven’t quit my job yet keyword being yet.
I only worked 6 months in 2008 so they withheld 20% for those 6 months. I have been in the country for more than 183 days though. So I should be getting 14% back from the 20%. The tax woman told my girlfriend that we should tell them if the amount isn’t right but I don’t know if they are taking the 20% into consideration.
[quote=“Dragonbones”]Do you have a signed contract with him for the full amount of payment? If so, the withholding is evident from the difference in the bank deposits and the contract amount.
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I have a contract with my hourly pay amount in Chinese also my hours submitted to CLA with the schedule. The English contract is just a list of rules. They didn’t give me an English translation of the Chinese contract. I asked, never received and forgot about it until now. I had my gf look over the Chinese contract before I signed it. I figured I could use that as some additional ammo if I had problems with them in the future.
In addition to this the boss also falsified my labor insurance in order to “save money.” So when I had to take medical leave I didn’t get the half salary pay I was supposed to get. The boss gave some money but not the full amount he was supposed to. I have up to two years to report that little nugget. I was going to wait until the end of my contract for that. I was only going to report that if I had additional problems because it is a hassle and everything is in Chinese. My gf says labor insurance fines are steeper than the tax office. My gf wants to take my boss to the cleaners.
The English rules say they won’t pay a months salary if I don’t give 30 days notice. I have heard that it is 10 days notice for under a years employment but haven’t found this on the CLA site. I would love to just quit on payday but I don’t want to get blacklisted and not be able to get a new work permit. Payday is on the 10th of every month so I need to consider that if I can give them a 10 day notice since I am sure they will try to keep my pay.
I had to take a medical leave last year and I was wondering if labor insurance is something that is standard for people working in Taiwan or if it is something “extra.”
Just make sure that you itemize and report everything very clearly to the tax bureau. Say for example that during those six months in question you earned $500,000. You would want to make sure the tax bureau knows that your gross earnings for that period was $500,000, but your net take home was only $400,000 because the employer withheld $100,000 (20%) for taxes. Also, make sure you that you have lots of evidence to back this up.
Original contract
Bank book deposit records (should clearly add up to $400,000 net income based on my simple example)
Copies of the teaching schedule
Copies of the grade reports
Whatever can prove you teaching in the classroom for the hours specified.
After all,the total money withheld from your net pay is YOUR money minus your tax obligation to the R.O.C. So, if $100,000 was actually withheld and paid to the government for your tax obligation and your gross earnings for the period was $500,000, you would fall into the 6% taxable income bracket. You would need to pay only $30,000 to the government and the remaining $70,000 of the withheld $100,000 would be your refund. Your employer has no right to any of this money, so don’t allow him to rip you off by under reporting after he’s already withheld the money.