Howdy,
If my Taiwan employer wanted to hire an independent contractor in the US or other foreign country, how complicated would it be? Documentation that would have to be filed on the Taiwan side and the US side, and money that’d have to be withheld for taxes for either side, and anything else I haven’t thought of.
Seems like it’s not very common here, so there must be some obstacles to this practice.
I work as an independent contractor for a certain government agency in the ROC. I’m not aware that there is any paperwork at all governing the whole thing. They mail me tax receipts once a year and I sign them. At this point, they are no longer withholding tax (a welcome change after more than 5 years at 20% without any opportunity to get it back).
I don’t think it’s any different from purchasing anything from a foreign entity. I don’t provide anything on my company letterhead, so they are treating me as an individual. The tax law used to say that “certain” foreign professionals were not subject to the 20% withholding (architects, lawyers, doctors, stuff like that, if I recall correctly) but translators were not considered to be “professionals” for tax purposes at that time. Since they are no longer withholding tax, something must have changed in that regard.
This is all assuming that the foreign contractor is not resident in Taiwan.
[quote=“ironlady”]I work as an independent contractor for a certain government agency in the ROC. I’m not aware that there is any paperwork at all governing the whole thing. They mail me tax receipts once a year and I sign them. At this point, they are no longer withholding tax (a welcome change after more than 5 years at 20% without any opportunity to get it back).
I don’t think it’s any different from purchasing anything from a foreign entity. I don’t provide anything on my company letterhead, so they are treating me as an individual. The tax law used to say that “certain” foreign professionals were not subject to the 20% withholding (architects, lawyers, doctors, stuff like that, if I recall correctly) but translators were not considered to be “professionals” for tax purposes at that time. Since they are no longer withholding tax, something must have changed in that regard.
This is all assuming that the foreign contractor is not resident in Taiwan.[/quote]
I would appreciate any more details on this if you find out, as I have the same issue with editing work that I am doing (20% tax with no way to get it back).
I checked my e-mail archives, but I can’t find an e-mail from them changing their policy on my withholding. They may have included it as a note on the hard-copy tax forms they mail me each year to sign. Sorry.
I would just call the tax office if I were you – they were very helpful in getting (at least Chinese versions of) the tax law for me when I asked them.
Thanks for checking–will ask my wife to call as she’s back for a visit.