I am a free lancer doing various voice and music production work. This company insists that if they pay me over 20,000NT, that they have to take out 20% and I can claim it at the end of the year.
Well, from what I learned, after 182 days, you don’t have to pay 20%.
But, this isn’t an english teaching job, or anything, so is there something I’m missing?
I told them I have paid 10%, 6%, and 0% and those rates are all acceptable, but not 20%!!
Any info or english web sites with this information to suggest?
Thanks
Brian www.brianfunshine.com
Well, I found a number and spoke to a lady in English about this. She said that 10% tax is what they should take out. Here’s the number…
2311-3711, extension 1116
The company I work for said that the rules were that:
For the first 6 months of employment, foreign workers should be taxed at 20% - after that you are taxed at the normal rate (e.g. 6%, depending on your salary). You can then claim back any excess tax when you file your taxes at the end of the fiscal year.
This was in 2003, so the rules may have changed - and is for a salaried job (not freelance).
as stated above, just get them to pay you in full, and then you do the tax stuff yourself. very unlikely that the company that says they will pay your taxes will actually submit anything - just a cash grab.
My point is, the’re trying to force me to deduct 20%. I don’t think they consider me to be in control here, so I’m looking for specific facts that I can show them to convince them easily, instead of having to go thru a whole hassle.
Tell them to make sure they are giving you your income under the “performance” category on the tax slip – you get all sorts of great deductions (makeup (!), costumes, musical stuff, etc. etc.). I do not believe they are required to deduct taxes under a certain amount, although some of my freelance clients have told me that they have to if the payment is over $10,000 NT. (This is a major company in Taiwan and they are usually pretty good about such things). They take out 10% I believe although it’s hard for me to check the amounts these days as I’m not in Taiwan.
My understanding of the tax legislation is that the employers of the majority of foreign teachers (teachers with ARC’s) are required to make the tax deductions prior to making salary payments. Therefore, the teacher cannot really opt to take the full pay and pay tax later. Yes, the locals are paid their full pay and then need to pay their taxes later, but foreigners are treated differently. Personally, I like this system as it means that I don’t need to worry about paying the money back at the end of the year.
david - The rule that you refer still applies, but this only applies to new arrivals. Brian Funshine has been here for a while now, and therefore this 20% rule shouldn’t apply to him.
Brian - As you would be aware, employers are often not aware of what taxes to deduct and often go off half cocked in suggesting that something ‘needs to be done’ when in fact it is just what they think needs to be done.
I am not a tax lawyer, but I am pretty familiar with the legislation as I have poured over it more than once. I can’t see any basis for the company to suggest a 20% payment in your case. If I were you I would show then a copy of the clauses of the tax legislation that relate to the withholding rates for foreigners which pretty clearly states the 20% for the first six months and 6% after that. Ask them to show you where the rule they are referring to can be found. If they can’t then insist upon them only taking 6-10% tax.
If they won’t oblige then go back to the tax office for their assistance. The tax office has assisted me with problems a couple of times and I was able to get a good outcome.
You should contact the tax department. Their foreign service desk is staffed with very friendly and helpful individuals. I believe Sophia is the senior person on staff there. She often is the one at the “Information” counter for the Foreign Tax Filings.
Their group is helping one of our clients, a buxiban English teacher, with her tax filing issues and have been extremely understanding and helpful in sorting out the issues. They are sympathetic to unscrupulous employers taking advantage of foreigners.
The tax office is easy to get to from Ximen MRT or Taipei Main Station. The building is the new building next to the Taipei Bridge. It’s the only modern building there flying the ROC flag, you can’t miss it.
[quote=“Bfunshine”]I am a free lancer doing various voice and music production work. This company insists that if they pay me over 20,000NT, that they have to take out 20% and I can claim it at the end of the year.
Well, from what I learned, after 182 days, you don’t have to pay 20%.
But, this isn’t an English teaching job, or anything, so is there something I’m missing?
I told them I have paid 10%, 6%, and 0% and those rates are all acceptable, but not 20%!!
Any info or English web sites with this information to suggest?
Thanks
Brian www.brianfunshine.com[/quote]
Brian, difficult to answer this in detail without having all the facts. On what basis is your ARC issued here? This can be a factor.
Also assuming that you do not have your own local company with which to issue invoices or receipts, then the company is correct in what they are saying, they have no choice, these laws were brought in last September from memory. Anyone who is not charging 20% is technically in breach unless you are employed by them.
There is a big difference in treatment in Taiwan between those people the comapny employs and those that they wish to make payments to for services rendered.
Geez, you are all so great for putting in your time, thinking bout this.
I guess the best thing is to contact the English speaker at the tax office some more. I speak some pretty decent Chinese, till I get to tax vocabulary, and other areas. So, anyway. I’ll keep you posted on the outcome. Thanks to you all!!
:bravo: Brian
You seem like a very zany and creative guy. :bravo: If the said amount is not too much, why not have some fun with your client and sing a song stating your displeasure at being taxed too much. Bring a videotape so we can see their reaction. I would pay to see this.
