My University didn’t withhold any taxes last year, and I had to devote my whole paycheck to pay it off. I have been with them full-time for a year now, and previously was part time. Now they figured out their mistake, but they started deducting 18% and said “it’s Taiwan Law”
I’ve been in Taiwan working for 5 years straight, with minimal amounts of time abroad. Last year (2014) I was in the country 350 days but since the school just began withholding taxes, the automatically set it at 18%.
This is killing me financially. I need help. Where is the specific law in Chinese, so I can show them they are wrong. Or am I wrong.
Does the 183 rule apply if I was here 365 days the previous year?
From what I can recall, a few years ago (as in five or six), they made that the new policy - so yes, schools are technically supposed to (or allowed to? suggested to?) withhold 18% for the first six months of every year. My university did that for one year, and I assumed it would be that way forever more, but then the next year it went back to the usual 5 or 6% withholding. I have no idea why. I’ve been operating on the assumption that many employers decided not to bother with the law (not exactly an unusual reaction to laws in this country!), but that’s just my guess.
My interpretation of it all: they’re within their rights to withhold 18% for the first six months - but not after that. Do you know what’s happening with your July pay yet?
They’re entitled to withhold 18% for the first 6 months as if you up and leave Taiwan that’s the liability. After six months it should be at the standard rate, or less. You can work out the tax liability for the whole year at standard rate, subtract what you’ve already paid @18% and then divide the remaining liability by 6 months, if the company is willing to play ball. Other option is to take it as enforced saving and wait for the tax rebate next year.