Tax on income generated by investment/trading in stocks for foreigners

What is the tax rate for foreigners who wants to invest in stock market and get profit out of it? Is there any link that gives the specification regarding this?

  1. no capital gains tax.
  2. if stock issues cash dividend, then 20% tax deducted from the cash dividend upfront
  3. if stock issues stock dividend, you pay tax (think 20%) on par value of NT$10 per share.

When you file income taxes in Taiwan the following year, 2) and 3) above are inputted into system.

This from personal experience.

I thought that was only for domestic company listings. And there still might be other tax implications.

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That’s why you gotta trade in NTD, homedog.

It’s also why there are ginormous corporate bond offerings denominated in NTD from the likes of Apple.

This is referring to capital gains from real estate, not equities. There is no capital gains tax on equities, domestic or foreign (dividends is a different story, as mentioned by KHHville). This is all assuming that you are a Taiwan tax resident, and that your home country has a tax agreement with Taiwan (the US does not).

There is a good thread on this a few months ago. I’ll see if I can find it.

Does the equation change for foreign student? As i don’t pay tax in taiwan because most of my savings are from scholarship.

How do you do trading in taiwan? Do you use local broker? If yes, then do they have English version. Or do you use local bank?

AFAIK, it is all based on tax residency. Your status as a student, etc., isn’t really relevant. I don’t know your specific situation, or your home country’s tax agreement with Taiwan, so you would need to look into that. Regardless, capital gains from equities is not taxed.

Interactive Brokers is a popular platform. You need to be responsible and proactive with your tax obligations (which are your responsibility to set up properly) with them. I use my home bank in Canada, but my accounts have been set up there a long time, and I am not currently a Taiwan resident.

China Trust and Cathay both have english versions.

I went to the websites of the CTBC bank (China trust) and Cathay United bank, but all of their information about investment are in chinese. I am interested in investing bond market.

The information would be in Chinese, but I believe the app is in English. You can also try Citibank.

Correct me if I am wrong. I was at a Cathay bank and the financial advisor told me all foreign investment or incomes bringing back into Taiwan are exempt of taxation if you can prove it was taxed outside of Taiwan for upto 6,700,000NTD per year and anything exceeding this amount is taxed at 20%.

Is this true?

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Hello, does the No capital gains tax also applies to ETF?

Thanks in advance!

It should.

Ok! thank you for the answer

I’m interested in the answer. Did you confirm this with the tax office?
Even if it’s true, it’s probably pointless for non-Americans. As I understand it, the W-8BEN form on IBKR and other brokers basically removes all American taxes except the withholding tax for dividends. So they are not exactly taxed outside Taiwan.

Not to mention the wording that you need to compare the regular income tax and AMT calculation, and pay the higher amount.

I dont’ know. Now reading you guy’s comment. I am even more confused now. The 6.7 million is assumed to be pre-taxed outside of Taiwan. You do pay tax. You pay the country that your 6.7million NTD was generated from. This 6.7 million NTD “rule” applies when you attempt to funnel into Taiwan’s financial system. If its below 6.7mil NTD when you wire transfer into taiwan and its provable to have been tax’ed at the country where income is generated, then no taxation in Taiwan. Anything over will be taxed.

This is what I got from the bank advisor.

Interesting. First time I heard about it. Sounds similar to Thailand rule for foreign income. Only becomes a tax issue when the money enters Thailand.