As jlick has kindly pointed out, one of the incentives to set up a rep. office is diminished because it is now much easier and cheaper just to incorporate and get an ARC from a regular company.
Originally I set up a rep. office as a stepping stone to a full Taiwanese presence. There are no minimum financial requirements to keep renewing your ARC, which is one of the main differences between incorporating a branch or proprietary company as a foreigner. It is a nice safety net to know you can legally do business in Taiwan finding customers and signing contracts without the pressure of minimum annual sales. It’s important to note, however, that this is more or less the limit of what a representative is supposed to do.
We now have two separate legal entities in Taiwan - a rep. office and branch office. I get my ARC through the rep. office and admin staff are also hired through this entity. The ARC is renewed every 3 years without any fuss at all. We manufacture and buy goods under the branch office which means we can claim back the 5% VAT on raw materials. We are 100% export only so we then sell the finished goods on to one of our overseas companies which resells them to local customers. It all works very nicely for everyone.
It is quite possible and indeed reasonably easy to get established here on your own. Both the company and I personally have checking accounts, credit cards, credit lines and all the other jazz you need to do business. A foreigner can incorporate a company on their own with no Taiwanese partner and once the company is set up you are treated exactly like a local company.
The main question you need to ask is if there is a sufficient international aspect to your business that organizing in a low tax country would be more favorable, or are you anticipating making so much profit that you would end up in a high tax bracket here? If no on both counts then a local company is probably better. If yes on the second part, please let me know if you need more investors. [/quote]
Sorry, I missed that, I read this thread a while ago and didn’t go back, but yeah, that was good answer which covered most of what I wanted to know.
We won’t be selling anything as such, no imports or exports of goods, but I guess that makes little difference as to which type of company we set up.
I guess a rep office wouldn’t work, as it’ll be two of us here and from my understandings, the government here gets a bit funny about having too many people getting an ARC through a rep office, no?
Also, if anyone knows a good accountant that doesn’t charge an arm and a leg to help set this stuff up, please let me know, as some people seems to get ripped off doing this stuff.
I’m not sure how big it will be, but it has a lot of potential, although as always, it’ll be a lot of hard work…
I would also recommend Ann Hu. She is my accountant. When I was looking around I had some cheaper proposals for set-up but they seemed pretty clueless while Ann was very patient about sitting down and explaining everything and answering all my questions. More important is to look at the ongoing monthly costs, and Ann’s fees there are in line with other accountants.
I have some bits to add and some questions; hope someone would be kind enough to advise:
SFS offers a business address as part of a package now. I’m getting virtual office, secretary, and business registration for £267.00.
[quote]NOTARISING FOREIGN DOCUMENTS
Notaries are much less common in England and you may have shared my pain in trying to get a reasonable service. Expect one week for processing in the UK and if you are sending documents from Taiwan, ask for EMS at the Post Office. The Express Mail Service costs NT$300 per document package and is several days quicker than regular mail.
UK citizens, I recommend Small Firms Services who charged me GBP57.00 for both documents (tel. 0800 328 7494). The cheaper bound apostille notarisation is sufficient.
Once your documents are notarised, they must then be sent to your local Taiwan Representative Office (TRO in the UK, TECRO in the US) for legalisation. They require that you send two copies of this form along with your notarised documents and a copy of your passport photo page, then send back your legalised documents within two working days. Give them a call to make sure you have everything in order first - they won’t bite.[/quote]
OK, which two documents need to get notarized? Will SFS get that done before mailing them out to my company’s registered address? Can the notarized documents then be sent here to Taiwan for legislation, or must that be done in the UK? Do you have current links for the forms that need to be sent along with?
[quote] WHAT YOU WILL NEED IN TAIWAN
your legalised limited company certificate
your legalised power of attorney appointing you as representative[/quote]
How do you get the latter?
That’s all I have right now. I’m pretty new to this kind of thing, so apologies if the answers are obvious.
You write your own power of attorney letter giving yourself power of attorney for the company in Taiwan, signed by… yourself. I’m sorry, I don’t have time to write an example right now but if you use a CPA they will provide this for you anyway.
Registration through a CPA costs anywhere from NT$30k-300k. You are probably looking at around $40-50k from your average outfit. Make sure they will help you with the actual resident visa because this is the hardest part and most CPAs will only register the Taiwan rep. office for you. That’s a bit of a gip for $40-50k because there are a few single page forms that a child could fill out.
I have something to add that may be useful for those who can speak Chinese or who have a friend to help out.
If you want an English speaking CPA who targets foreigners then the minimum fee to set up a rep. office is going to be around NT$30k or around $45k for a local company.
However, if you go to a local Chinese speaking CPA the fee is more like $6,000. Of course they won’t be able to help with visa issues etc. but then neither can most of the English speaking CPAs - generally company formation is their job, visas etc. are yours. As far as I know immigration assistance requires a special license which most CPAs do not have.
I will try to report back soon with contact details for some recommended Chinese speaking CPAs who might be able to save some people here a lot of money. I’m not sure you even need them for a rep. office but a local or branch office gets much more complicated and there is potential to screw up the tax issues.
One difference between a branch and a limited company or a company limited by shares is that legally the branch and the parent company are identical. Thus, if the branch gets sued in Taiwan, the parent is liable in the view of the Taiwanese court. A foreign-invested company in Taiwan though is legally independent of its parent, who is just a shareholder in the company. This is usually not much of a concern for smaller ventures though.
I was recently told by a cpa that rep office arc’s are now good for only one year. To get it renewed, you have to show a tax return. Have you had experience with this? Heard this anywhere else?
I sent the name to you via pm…didn’t want to embarrass the company if they made an error.
I’m looking for the fastest and cheapest way to get this thing done…it seems that I need to either expect things to be slow or pay out my nose. If anyone has any suggestions of CPA’s they have used, Chinese speaking or English speaking, please let me know.
You might get a 1 year ARC if you apply for a work permit through your rep. office instead of using it for investor status. I think one or two others here did that on recommendation from their CPAs but didn’t leave much more info. As an investor you get 3 years, no health check, no police records.
PS - count on it taking about 4 months including the time it takes to ferry documents back and forth between your home country.
I got three years initially, the renewal was for two years and I sort of expect it to be one year for the next extension which is due in about a month’s time. That is work permit through rep office. No health check and I think they didn’t ask for the police record either, although I had it just in case.
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