Am I right that if I switch my residency to Taiwan, my foreign divided income will only be taxed at 20%. Is there anything else to consider?
I also believe since I’m a ROC citizen, as long as I don’t live in any other country over threshold for residency, Taiwan can be my tax residency even if I’m not here over 180 days. But I’m not 100% about this.
This would make things very interesting for me if I could do this.
I would not know the answer, but this is the way I understand it works for you and other citizens of residence-based taxation countries. As a US citizen, this makes me jealous.
Where did you get this info?
I think that largely depends on the other countries involved - depending on them, they might not accept your declaration of moving your residency away - especially if you stay in Taiwan less than 183 days per year.
From a Taiwan taxation point, overseas dividends could even be tax free if they are overseas income (until about 6 million NTD).
Aren’t you a U.S. citizen? If you are, the only tax advantage you get is the foreign earned income exclusion.
I still need to figure out how it works for US taxes.
I just need to find a way to be more tax efficient, the UK is just robbing me right now. It’s absolutely shocking how much they tax in the UK.
Talk to an accountant or tax lawyer in the UK.
My understanding is that you would still be primarily be a tax resident if you spend more than 183 days in the UK. Taiwan and US taxes would be in addition (to the extent you cannot claim exclusions for income taxed by the UK already).
The alternative would be to funnel your investment income into a corporation incorporated in a tax haven (ideally in a place that has double taxation agreements with the countries in which you invest).
I think the answer is it depends.
Now in my case, I am not a US citizen and not a Taiwan citizen. I have Taiwan tax residency. I invest in the US and in Ireland (Ireland domiciled ETFs) through a US broker. US broker automatically withholds 30% dividend taxes on US based stocks and ETFs and 15% on Ireland domiciled ETFs.
Taiwan does not tax any of this up to the AMT at NTD 6,700,000.
So, in your case. You just declared the foreign income from ETFs’ dividends to the tax bureau. And because the total of local income + foreign income (ETFs’ dividends) is below 6.7 mil NTD, the foreign income doesn’t get taxed. Not even under income tax. Is that right?
That’s neat. Seems they should have advertised this more if they really want to attract high-income/net worth expats.
I pay myself through dividends. My goal is to be able to not be in the office in maybe 1-2 years time. If I can just live and travel in places I want and just switch my residency to Taiwan would be great. I’m closing in on the 39% tax rate in the UK for dividends. I just pay myself a salary exactly under the threshold for my salary income to not be taxed. But 39% is still so high.
But I’ll need to figure out what that means for my US tax liabilities as well.
Yeah, I suspected this. The thread is about paying yourself through dividends/salary from your own company. Not about money you make from brokerage account.
I’m moving towards a goal where I don’t need to be. I’m hiring more staff to do all the things in the office for my e-commerce business. Most of the stuff I’m starting to integrate and consolidate to a platform where I can manage all of the things I need to on my computer.
So this is why I’m wondering how I can be more tax efficient as my business allows me to not be in the office all the time moving forward.
Do you know if Taiwan has a tax treaty with the US? I believe the credit system can work in places with a tax treaty with the US.
It doesn’t, unfortunately.
Ugh 
I’m going to need to find some specialist for people like me that want to move around instead of staying in one place.
I do not declare foreign income from ETF dividends. My total income is still below 6.7 million. By the way, I believe Singapore has a similar tax system for people who like to travel.
Edit:
Found some detail here:
In addition to the normal tax calculations, the AMT
system uses a different set of rules for determining
taxable income. If the regular income-tax amount is
greater than the AMT, no special action is required. If
AMT is greater than the tax calculated using the regular
rules, the difference between the AMT and the regular
tax is added to the regular tax amount, so the taxpayer
pays the full amount of the AMT.
Taxable Income + foreign source income (effective
from 2010 year) + insurance payout portion in excess of
TWD 30 million. + Capital gain earned from selling
shares/ beneficiary certificates not listed in stock market
- Tax deduction claimed for non-cash based donation
made + Excess of market value over par value of the
stock dividend granted to employee = Income subject
to AMT.
Please note that as per Article 12 of Income Basic Tax
Act, if combined foreign source income is less than
TWD 1 million per annum then there is no need to add
foreign source income to the formula listed above.
Thanks for the answer.
Yeah, there are a quite a few countries with territorial or pseudo-territorial taxation system. Especially in Asia. International taxation - Wikipedia But they are trying to remove it. Like the recent attempt in Malaysia. Could be related to CRS? Dunno.
I personally got the impression it’s harder to migrate to Singapore. The permanent residence and citizenship pathway are also less guaranteed.
Anyways, irrelevant to OP. He has his own company and pays himself dividends and salary, I think.
Pretty confusing wording honestly. I think the spirit of the AMT is even if you try to reduce your income tax by classifying part of your income as foreign income, it’ll only work up to the total income of 6.7 mil NTD. But I’ve seen people online using this AMT rule as some kind of worldwide income rule for Taiwanese who resides outside Taiwan. Like What are the rules about declaring foreign income into Taiwan? : taiwan or Regulation about alternative minimum tax (individual) in Taiwan -- Taiwan Business -- kaizen . Tax bureau doesn’t seem to care according to sanem48 comments on Are capital gains from securities trading taxed in Taiwan? .
Agreed, seems to be a different situation.