Employer Pension Contributions

Business Money
1

Hi All,

According to BLI employers are required to pay “6% or more” into their employees pension funds.

I’m just wondering if there is a limit to how much employers can contribute?

I’m 30 and thinking more seriously about my (currently inadequate) retirement savings. When my next salary negotiation comes around I want to ask my boss to increase employer contributions to 10% instead of 6% (and I also voluntarily contribute 6%) rather than increase my take home pay.
Are employers allowed to do this or is there a limit to employer contributions too?

Bureau of Labor Insurace Website-Labor Pension-Characteristics of the New Labor Pension System This only says 6% or more so I assume they can but I’m wondeirng if anyone has experience with this?

2

In 15 years I have never heard of an employer contributing more than 6%. Also, not sure if the government-run pension plan is the right place to deposite extra funds. You are probably better off getting a raise and investing it yourself.

3

I’m sure none do it willingly :joy: I do invest money myself too :slight_smile:
I just like the idea of money being saved that I never see and never have to worry about. My self control is not great but I always pay my bills on time and don’t spend beyond my means. Pension contributions are also tax free and the returns are not too bad for Taiwan.

My finance is roughly based on ‘Barefoot investor’ with slight adjustments for Taiwan. which is a great book if you’re interested! Pension accounts are part of the overall strategy

4

Employer must contribute 6. Employee can match up to 6.

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5

I know but my question is whether there is a cap on employers contributing more than 6%

6

If there is a cap on employee contributions then there must be a cap in employer contributions.

Why cap one but not the other?

7

…. That’s why I’ve asked the question. The BLI just says ‘employers must contribute 6% and they can contribute more if they wish’ the website doesn’t mention a cap. I am being logical.
Hence asking the question.

If you’re not sure, no problem. I’m sure someone will know somewhere :slight_smile:

Logic in government is not something I expect anywhere let alone Taiwan

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8

Based on calculations I did a few weeks ago, with the annual dividends that the government pension pays out you are looking at annual return of around 4.5% over the last ten years. Pretty mediocre. If you or your employer has extra money to invest then you might be better doing so in an overseas investment that has better average returns and is safer than Taiwan’s pension scheme. Who knows what would happen to that thing in the event of a Chinese invasion. My Taiwan pension is probably the highest risk, lowest return investment I have.

9

I have done extensive research back in the day, and the TW pension system is not good, at least not good compared to my home country and not good for foreigners living here long term.
If you have access to any sort of retirement savings in your home country, and can invest independantly you might be better off doing so.

10

Only 6% maximum :slight_smile: However… your employer can choose to make it off of base salary or base+bonuses and allowances

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11

Are foreigners eligible for this? If you leave Taiwan can you withdraw the lump sum?

12

If you have an APRC or are married to a National with household registration then your employers are legally required to deposit 6% into your pension account (many don’t do it though).

You can’t withdraw a lump sum when you leave. You could claim a pension or a lump sum when you turn 60 but there are a few conditions

13

Got it. So only if you have an APRC.

But if you don’t have an APRC, can you tell your employer to contribute anyway?

14

APRC or regular ARC and married to Taiwanese

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15

If you want your employer to laugh at you I guess

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16

Good luck.

Getting employers to pay when they’re legally required to has not been an easy task for me.

Getting them to voluntarily pay would be almost impossible.

17

It’s a startup run by ABTs that’s been hounding me. Pay is 250k a month, so this would be a trivial addition for them…only blocker would be if they actually cant do it as I have a GC not an APRC.

1 Like
18

iiuc, it is the case.

Labor Pension Act
Article 7

This Act applies to the persons below as designated under the Labor Standards Act, but does not include those whose pensions are appropriated in accordance with the Private School Act:

  1. Workers holding ROC citizenship;
  2. Foreigners, people of China, Hong Kong or Macao residents who have married ROC nationals and registered a household in the Republic of China, and who have residency status and are permitted to work in Taiwan;
  3. Foreigners, people of China, Hong Kong or Macao residents in the preceding subparagraph who have divorced their spouses or whose spouses have passed away, and who are permitted in accordance with relevant laws and regulations to continue to reside and work in Taiwan.
  4. Foreigners other than those mentioned in the preceding two subparagraphs who are permitted to reside permanently in accordance with the relevant provisions of the Immigration Act and are employed in Taiwan.

ROC nationals and persons referred to in subparagraphs 2 through 4 of the preceding paragraph who satisfy any one of the following statuses may voluntarily make payments for and claim a pension in accordance with the Act:

  1. Employers who actually engage in labor work;
  2. Self-employed operators;
  3. Commissioned workers;
  4. Workers not designated under the Labor Standards Act.
2 Likes
19

Interesting. I never interpreted it that way

20

Gotcha. And there we have it.

So any self-directed savings plans you can do with an ARC? Something like a pension, where its a fixed term of contributions.