Paying taxes and being paid on the Gold Card

Legal Taxes
1

I apologise if this has already been covered in one of the numerous Gold Card threads. I’m also finding it surprisingly difficult to Google a straight answer. I don’t think a dedicated thread to this topic would hurt.

If I work remotely for a UK company while living in Taiwan on the Gold Card visa, would I need to set up a Taiwanese bank account to be paid in to and pay my taxes to Taiwan, or would I continue to be paid in to my UK bank account and pay my taxes to the UK? If it’s the former, would I still be entitled to Taiwanese healthcare and other benefits? Does it make a difference if I spend some of the year in Taiwan and some of the year in the UK?

2

no

yes

depends, but probably only in a minimal way

Potentially a big difference. It depends on how many days where.

See: Tax | Taiwan Gold Card - Taiwan Foreign Talent Community

3

Also could be vastly different if Taiwan and UK have a double taxation agreement or not. Some countries do (Germany, for example) while others don’t (US). Not sure about the UK, though.

4

Thanks for the replies! Yes, the UK has a double-taxation agreement with Taiwan. So does that mean I simply pay my taxes to Taiwan for the months I’m in Taiwan at the end of the financial year and not worry about the UK and it would be on me to tell the UK tax office that I’ll be out of the country?

5

No, that means that the double taxation agreement should include rules about which country you should be paying taxes. The 183+ day rule might be one option, but some double taxation agreements might define some other rules exceptions from that rule you can or have to follow (for example, if your „center of live“ is in one country, the 183+ day rule might not even apply and you still need to pay taxes in another country even when being there less than half of the year).

In the other hand, if you have a job in the UK and are paying your taxes there, the double taxation agreement might save you from filing taxes in Taiwan - even if you stay there longer. But that really depends on the content of the agreement.

But those of things mostly require a tax lawyer with understanding of international tax law unfortunately…

6

Just took a look out of curiosity:

Article 4: Residence

For the purposes of this Agreement, the term “resident of a territory” means any person who, under the laws of that territory, is liable to tax therein by reason of his domicile, residence, place of management, place of incorporation or any other criterion of a similar nature.
[…]
Where by reason of the provisions of paragraph (1) of this Article an individual is a resident of both territories, then his status shall be determined in accordance with the following rules:
(a) he shall be deemed to be a resident only of the territory in which he has a permanent home available to him; if he has a permanent home available to him in both territories, he shall be deemed to be a resident only of the territory with which his personal and economic relations are closer (centre of vital interests);
(b) if the territory in which he has his centre of vital interests cannot be determined, or if he does not have a permanent home available to him in either territory, he shall be deemed to be a resident only of the territory in which he has an habitual abode;
(c) if the individual has an habitual abode in both territories or in neither of them, the competent authorities of the territories shall settle the question by mutual agreement.

and further:

Article 15

Dependent personal services
(1) Subject to the provisions of Articles 16, 18 and 19 of this Agreement, salaries, wages and other similar remuneration derived by a resident of a territory in respect of an employment shall be taxable only in that territory unless the employment is exercised in the other territory. If the employment is so exercised, such remuneration as is derived therefrom may be taxed in that other territory.
(2) Notwithstanding the provisions of paragraph (1) of this Article, remuneration derived by a resident of a territory in respect of an employment exercised in the other territory shall be taxable only in the first-mentioned territory if:
(a) the recipient is present in the other territory for a period or periods not exceeding in the aggregate 183 days in any twelve month period commencing or ending in the fiscal year concerned; and
(b) the remuneration is paid by, or on behalf of, an employer who is not a resident of the other territory; and
(c) the remuneration is not borne by a permanent establishment or a fixed base which the employer has in the other territory.

Quite difficult to understand, I think, without legal assistance, unfortunately…

For example, the agreement seems to have a more complex 183 day rule:

for a period or periods not exceeding in the aggregate 183 days in any twelve month period commencing or ending in the fiscal year concerned

And also, you might still be a tax resident in the UK (in terms of the agreement) if your „centre of vital interests“ is still in the UK.

So the UK tax authorities might not simply let you out of taxation in the UK just because you’re out of the country for some parts of the year. Especially if you have some financial resources still in the UK (or your employer is UK based).

So TLDR: It’s mostly UK taxes you should worry about. So more a UK questions then a Taiwan question, I would say as the „Taiwan part“ is probably the easier one.

7

This is a misconception so many people have. Just because you spend 6 months +1 day somewhere else you are no longer a tax resident. Every country has a ‘meaningful ties’ or ‘center of gravity’ test.

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8

I’m too knackered to write a detailed tailored answer but I’m in a similar situation to you (slight difference may be that I’m a freelancer for the UK company, rather than a remote employee - not sure about you). Here’s a recent relevant thread of mine:

Briefly, you don’t need to set up a Taiwanese bank account but you should pay taxes to Taiwan not the UK, assuming you’re tax resident here (no idea how it would work getting out of PAYE in the UK if you are an overseas employee). You might want to open a local bank account anyway, but it’s not essential (or really relevant to your tax liability).

You would still be eligible for NHI, assuming the new rules (no six-month waiting period) have come into effect - see here, for example:

Yes, it could, but that would depend on the specifics.

9

This website Taiwan Employment Gold Card FAQ 臺灣就業金卡常見問題 - Foreigners in Taiwan - 外國人在臺灣 says:

Q: What benefits does Taiwan’s employment gold card have?
A: The benefits associated with the employment gold card or special professional work permit are as follows:

  • A tax benefit of only being taxed on 50% of annual income above 3 million NT, for the first three years in which the foreigner is a tax resident (stays in Taiwan over 183 days).
  • Exemption from tax on overseas income (alternative minimum tax, or AMT) for the first three years in which the foreigner is a tax resident (stays in Taiwan over 183 days).
  • For individuals that apply for the gold card, they are free to change work or employers freely without application from the labor bureau for the duration of the gold card (3 years).
  • Allows foreign teachers with specialist skills to teach in cram schools (buxibans).
  • Allows work permits to be issued to freelance artists that qualify.
  • Those that meet requirements for a gold card to do not have to meet the 5 million NT paid in capital requirement (or annual 10 million NT turnover) for a company to sponsor a work permit.
  • The same law that created the gold card (Act for the Recruitment of Foreign Professionals) also stipulated that all foreign white collar professionals (with or without a gold card) have other immigration benefits for family dependents, such as no wait for health insurance, extended work permit times, easing permanent residency rules, etc.

Doesn’t the second point says that foreign income is exempted from tax for the first 3 years in you spend more than 183 days a year? I wrote in to Taiwan Tax Authority to clarify on this exemption but have not received a reply yet.

10

No - I’m guessing the sentence is just badly written, but it’s clearly referring to AMT rather than all income coming from abroad. (If you don’t know what that is, you can find decent explanations online.)

11

Agreed. Income from salaried work or services performed when physically in Taiwan for more than 90 days is considered Taiwan sourced income, not foreign income.

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12

Thanks all for the replies. I believe you are right, that statement about the tax exemption is just referring to AMT.

My background is rather similar to thread starter except that I am from Singapore. I have just received the gold card. Intend to work remotely from Taiwan but still checking my tax obligations.

DTA between Singapore and Taiwan reads similar to the UK’s. It can be found at https://www.iras.gov.sg/IRASHome/uploadedFiles/IRASHome/Quick_Links/singaporetaiwandta.pdf.

Articles of interest are:

ARTICLE 4 - FISCAL DOMICILE

1. For the purposes of this Agreement, the term “resident of a territory” means any person who is a resident in accordance with the tax laws in that territory.

2. Where by reason of the provisions of paragraph 1 an individual is a resident of both territories, then his case shall be determined in accordance with the following rules:

(a) he shall be deemed to be a resident of the territory in which he has a
permanent home available to him. If he has a permanent home available to
him in both territories, he shall be deemed to be a resident of the territory with
which his personal and economic relations are closer (centre of vital
interests);

(b) if the territory in which he has his centre of vital interests cannot be
determined, or if he has not a permanent home available to him in either
territory, he shall be deemed to be a resident of the territory in which he has
an habitual abode;

(c) if he has an habitual abode in both territories or in neither of them, the
competent authorities of the territories shall settle the question by mutual
agreement.

3. Where by reason of the provisions of paragraph 1 a person other than an individual is a resident of both territories, then it shall be deemed to be a resident of the territory in which the control and management of its business is exercised.

ARTICLE 12 - PERSONAL SERVICES

1. Subject to the provisions of Articles 13, 14, 15 and 16, salaries, wages and other similar remuneration or income for personal (including professional) services derived by a resident of a territory shall be taxable only in that territory, unless the services are performed in the other territory. If the services are so performed, such remuneration or income as is derived therefrom may be taxed in that other territory.

2. Notwithstanding the provisions of paragraph 1, remuneration or income derived by a resident of a territory for personal (including professional) services performed in the other territory shall be exempt from tax of that other territory if

(a) the recipient is present in the other territory for a period or periods not
exceeding in the aggregate 183 days in the calendar year concerned; and

(b) the remuneration or income is paid by or on behalf of, a person who is a
resident of the first-mentioned territory; and

(c) the remuneration or income is not borne by a permanent establishment which that person has in the other territory.

3. A resident of a territory shall be exempt from tax in the other territory on remuneration for services performed on ships or aircraft in international traffic.

From article 4, I should be deemed to be a resident of Singapore.

From article 12 point 1, since I am performing services as a resident of Singapore for my company based in Singapore but services are performed in the other territory (Taiwan), I may be taxed in the other territory (Taiwan). But from point 2, I should be exempted from tax in the other territory (Taiwan) if I spend less than 183 calendar days a year in Taiwan and paid by my company based in Singapore.

If my understanding is correct, then it means that I should spend less than 183 calendar days a year in Taiwan if I want to avoid double taxation. But doing so means that I would not be fulfilling the minimum 183 calendar days a year needed for permanent residency. If I hope to get permanent residency in Taiwan, I should still spend at least 183 calendar days a year in Taiwan and pay tax in both countries. :slight_smile:

13

One important thing is that taxes in Taiwan seem to be based on the percentage of days you are in Taiwan (if less than 300 (?) days but more than 183 days (?)).

So if you stay in Taiwan for 190 days per year, you only need to pay about 50% of the taxes that you would normally have to pay.

Also, with Singapore, it seems to be common among Taiwanese to only receive dividend income from there which would count as Overseas income and wouldn’t be taxed in Taiwan. YMMV.

14

Reading this thread prompted a question that I was planning to care for next year, but since it’s related I will just shoot it in case someone has been through it before.

  1. A Gold Card holder residing in Taiwan most of the year and performing remote work for overseas companies paying him/her into an overseas bank account. Which documents need to be provided to the Tax Authorities as a proof of income? The payment slips (in English)? Statements from the overseas bank? A copy of the collaboration/remote employment contract? Anything else? :thinking:

I found this on the NAT website, but I don’t understand what they mean by “notarised by the tax authorities”, “notarised by a CPA” or “if the taxpayer fails to submit […] according to the standard amounts”.

B. Income paid by an employer outside the territory of the R.O.C. must also be reported by the taxpayer. The taxpayer will be required to submit a certificate of earnings notarized by the tax authorities concerned from the employer(s) outside the territory of the R.O.C. If a certificate from the tax authorities is not available, a notarized certificate issued by a notary public or certified public accountant (CPA) is acceptable. In the case where such a certificate is to be used, a photocopy of the license of the CPA who issued the certificate must also be submitted. If the taxpayer fails to submit a certificate of earnings issued by the tax authority or certified by a notary public or CPA, the tax office will assess the amount payable according to the standard amounts. Any income received in foreign currency should be exchanged into New Taiwan Dollars (NT$) on the basis of the official foreign exchange rates or prevailing transfer rates at the time the income is actually or constructively received.

Anyone has experience with this scenario?

  1. A Gold Card holder residing in Taiwan most of the year and receiving dividends from overseas. From the information available, this source of income does not imply work performed in Taiwan, is not subject to AMT if below 6,700,000 NTD, but needs to be declared if above 1,000,000 NTD. Same question as for the previous case: which documents need to be provided as evidence?
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15

See my recent thread here - same one as I posted above:

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16

Thanks for all the replies!

To get complete clarification, I called up the tax office in Taiwan and they told me that anybody in Taiwan for more than 90 days must pay their taxes to Taiwan (confirming several of the responses here). I believe that there’s a double-taxation treaty with the UK which means I wouldn’t also have to pay taxes to the UK. However, I don’t know how I would go about stopping tax payments to the UK or how exactly it works. I’ve been advised to speak to a financial advisor about this, but finding a financial advisor with experience in this kind of thing isn’t easy!

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17

You can’t just stop paying taxes in the UK if you happen to spend over 6 months away. You need to get approval from the Inland Revenue that you are no longer tax resident there.

There are a complicated set of rules which vary depending you your exact situation. Things like numbers of days you can be present in a year, whether you were resident in previous years, how many “ties” you have etc.

And once you’ve left the UK, you have to be really careful about numbers of days you spend there in each year, or you can accidentally become tax resident again.

This is a summary of the rules from a UK accountancy firm:

18

Thanks! Sounds like working remotely in Taiwan with the Gold Card Visa isn’t nearly as straightforward as I’d anticipated.