If My Job Falls Through Before APRC, Is Starting a Company a Good Idea?

[kaanayp]

Dear Company Owners and Freelancers of Forumosa, I’m at a crossroads lately and could really use some guidance on how to go about obtaining my APRC.

My Situation: I have one more year of work before I become eligible to apply for the APRC. However, the future of my current job hasn’t been looking very bright lately (due to circumstances outside of my control). Finding a new job in my field of video production/motion design could prove quite challenging — especially one that would satisfy the APRC income requirements.

So, I’ve been thinking about doing freelance work to have an extra source of income to support my APRC application. As you know, freelance work needs to be done under an ARC in order to be taxed and counted toward the APRC.

Fortunately, I’d be able to put together around US$15K from my savings overseas to set up a company in Taiwan, which would allow me to take on freelance projects (at least as far as I understand). However, this would mean I’d have to survive for a while on what I can save up here (which won’t be that much tbh).

On top of the required capital, there would also be additional expenses such as monthly rent for a virtual office address, accounting services, etc. All of this is making me reconsider taking this route, since it’ll probably take some time before I generate anything substantial from freelance projects as well.

Instead of going down this costly path, I could use that money to cover my living expenses while looking for another job (in case of unemployment in the near future). But, on the other hand, freelance income could be a lifesaver in the future when I apply for the APRC.

So enlighten me, Forumosa! What might I be overlooking in this plan? Or what am I making too big of a deal? Feel free to ask me to clarify anything related.

Of course, I’ll discuss all of this with a CPA at some point and won’t rely on here for financial advice… but I could really use some insights right now to clear things up. Tysm!

[ilikecoffee]

It seems there is a complex challenge here.

1. Will you have a job? If your company lets you go, you will get severance. You’ll also get time to look for a new job (that shouldn’t impede your APRC, I think).
2. Will any job in your field satisfy the APRC salary requirements? Which are currently? I’m out of the loop on that number.
3. Are there alternative things they could take into account in lieu of salary? Property? Assets? Money in banks? Higher level of education?

It seems that you are indeed at a crossroads. Are we talking more than a year or less than a year before you hit the mark?

Honestly, …

…you could work for your own subsidiary by opening a rep office here for your company in HK. Establishing a company isn’t going to be cheap, esp. if it’s your current field. If you have a client list, then obviously you can reduce the startup risks… but don’t expect to make much that first year or so.

Essentially, you need to choose EITHER to set up a company OR to find a better job (do the groundwork now). It may be frustrating but the goal is to qualify for APRC first time around… if you set up a company, and run it… do it for that reason because, though you may have a company, it’s unlikely you’ll make much money in your first few years in business. The APRC will come in time. But have you looked at the investment gold card?

[irish91]

@kaanayp

Finding a new job in my field of video production/motion design

@kaanayp

I’ve been thinking about doing freelance work to have an extra source of income to support my APRC application

My understanding is there is a work-permit for freelancing where an employer wouldn’t be needed that could be looked into:

Foreign art workers do not have to apply through an employer, but can rather apply directly to the Ministry of Labor for a permit to engage in one of the following categories of art related work:

1.Performing and visual arts category: This refers to individuals engaged in creative work, research, surveys, production, performance, promotion, workshops, seminars, review (commentary) or competitions, relating to music (other than popular music), dance, fine arts, drama/theater, environmental art, photography etc.

2.Publishing industry category: This refers to individuals engaged in art and cultural graphics and text creation, commentary, copyright management, editing, translation, curation or research, relating to newspapers, magazines, book publishing etc.

3.Cinema, radio, television and popular music category: This refers to individuals engaged in art and cultural creation, production, performance, promotion, workshops, seminars, review (commentary), competitions, management, management operations, technical aspects, relating to cinema, radio, television and popular music.

4.Handicraft art category: This refers to individuals who engage in creative or teaching work relating to the fields of leather, ceramics, stone, glass, fiber (dyeing, weaving), wood, bamboo, paper, metal, paint or mixed media.

5.Other categories of work approved by the Ministry of Culture.
https://ezworktaiwan.wda.gov.tw/en/cp.aspx?n=A3A039AE2797E97F

Also have you checked the qualifications for the Gold Card? for freelancing it would make things easier.

Qualifications

[kaanayp]

Hello!

@ilikecoffee

Are we talking more than a year or less than a year before you hit the mark?

Less than a year before I hit the mark (just had my 2nd anniversary at work this month).

@ilikecoffee

…you could work for your own subsidiary by opening a rep office here for your company in HK.

Sorry, I’m a bit confused about the “HK” part?.. If you mean Hong Kong, I have nothing to do with there

@ilikecoffee

But have you looked at the investment gold card?

I have looked into it, but I doubt that I could qualify for it — the monthly salary threshold is way above my wage.

So yeah, you might be right. It’s probably a bit risky to start setting up my company now. I still have my job, so I’ll probably focus on it and save up some money for the time being and reconsider my options when unemployed. Thanks for the reply!

[kaanayp]

Hi! I’ve seen this too, but I immediately brushed it off as my work is much more commercial than it is artistic… However, maybe the Ministry of Labor thinks differently. I’ll contact them and inquire more. Thanks!

@irish91

Also have you checked the qualifications for the Gold Card? for freelancing it would make things easier.

I checked the qualifications, and although it’s perfect for freelancing, I’m way below the salary requirements to be qualified.

[ilikecoffee]

Search for “Representative Office” and setting up a company that only trades overseas (not HK domestic)… it’s a bit tricky to explain. I think you can find answers in the Business Threads.

Complete Guide to Opening a Rep Office 2011 Update

Preamble Although this was written a few years ago, it has undergone periodic updates and should still be accurate. Please let me know if you learn otherwise. First, thanks to fellow board member Llary, without whom none of this would have been possible for me, as well as my friend Vlad who helped me a lot during the process, and the other active posters here on Forumosa, most notably LostSwede. Basically you can register a rep office all by yourself, in 3 easy steps. But first some explana…

[SNcbz3]

Is there any way the company can keep you on for a few more months? For your final 6 months you can use the “6-month looking for a job” extension, which counts toward your APRC time.

As someone who’s gone the start-a-company route (in 3 easy steps, no less), I can say it’s not the easiest way! If you have less than a year to go I would say there are surely easier ways.

Last but not least you will need to pay tax on at least the min. foreigner salary (48-49k/month) in your final year of the 5 years in order to qualify for the APRC. Something to keep in mind.

[kaanayp]

After doing research and hearing similar things, I’ll definitely ride my current job as long as they keep me For now, I’m just trying think how I can set up safety nets for the worst case scenario.

@SNcbz3

As someone who’s gone the start-a-company route (in 3 easy steps, no less), I can say it’s not the easiest way!

Would you mind sharing what the bottlenecks have been in your experience? Are the costs higher than expected, or is it more about the paperwork and application process?

Because some comments make it sound it’s super easy (usually those who are selling services related to setting up a company), others say it’s not at all. So I’d really like to get insights from foreigners who are actually going through that route.

@SNcbz3

Last but not least you will need to pay tax on at least the min. foreigner salary (48-49k/month) in your final year of the 5 years in order to qualify for the APRC. Something to keep in mind.

I’ve read that they check if your salary in the final year was twice the minimum wage (so around 60k instead of 48k per month). Not sure if that’s a newer regulation.

Even if it’s 48k, wouldn’t it still be an issue if I had no income in the last 6 months before applying? That’s why I was considering starting a company to do freelance projects and make up for that amount in case I’m unemployed before my application.

[SNcbz3]

@kaanayp

Would you mind sharing what the bottlenecks have been

It’s just a lot of steps and things to get organized for something you only need for less than a year, or less than half a year even. You’ll need an office, which most likely means renting (probably for 12 months) because usually landlords do not want you to register at their place for legal reasons. You’ll need an accountant to sign off on your company set up. You’ll need stamps and have to submit bimonthly tax statements. And finally you’ll have to un-set-up the whole thing in a few months which isn’t a whole lot easier.

@kaanayp

twice the minimum wage

The 48k is (was?) twice the min wage. It’s probably a bit higher at this point. When I applied for my APRC all they checked was how much tax you paid in that year. If it’s more than 12x the 2x min monthly wage amount then you pass. So you can earn all the month in the first 6 months, and then zero for 6 months. AFAIK no one will care.

Good luck!