What proof should we ask for when we pay income taxes and what is the correct %?

Here in TW I’ve worked for only one non-public school. The agency charged me 22% taxes but I doubt if the taxes were ever paid to the corresponding tax office. I say that because they could never hand me any document that showed the taxes were paid. And I didn’t push the issue because that agency’s reps were at times scary when they heard things they didn’t want to hear.

  1. What does this document look like and what is it called? Back in the States the taxes paid are shown on our paycheck stub. If we had direct deposit, then we received a statement on or about the same date. Here in TW I’ve always had direct deposit. So, what does the paycheck stub look like and what’s it called?

  2. Now that I’m on the topic of taxes what is the correct tax percentage? Believe me, I’ve heard everything from 6% to 18%. I called the main tax office in TPE and they explained the system to me, especially the part about the rate for the first 6 months versus the second 6 months. However, the agency mentioned above got ticked off when they heard that I called the TPE tax office. The jerk representative had the unmittigated gall to say that the TPE tax office has no idea what it’s talking about.

Thanks!

at least once a year, you should receive a receipt/form that says how much your employer “withheld” and then you go to the tax office yourself to fill in the proper form to pay your taxes. You are actually not paying your taxes that way. The tax rate varies… it’s a sliding rate, from 6% to 20%. If you stay in the country for less than 6 months of any given calendar year, you automatically pay 20%.

If your job is legal, you should pay taxes and be able to call the tax office any time you want.

edit: and please keep in mind the difference between “withholding” and “paying” taxes.

If you are working legally AND your company accurately reports your income in accordance with the tax laws, you will receive a record of Withholding and Non-withholding from your company every year before tax time. You will use this document to file your tax return and then either pay additional taxes if owed, or receive a refund for any monies which were over withheld. It’s very similar to the infamous W-2 forms Americans receive and need to use to file their taxes.

Here’s what the form you should be receiving from your employer every year looks like. If they are not providing this to you, then they are afoul of the law!

If your company does not or has not provided this document to you, then they are NOT reporting your taxes to the government. And…if they have been withholding a certain percentage of monies from your monthly paycheck in order to satisfy tax withholding on your behalf,then they are pocketing this money themselves! Taiwanese are experts at ripping off their employees and also ripping off the government when it comes to paying taxes (avoiding paying taxes). :fume:

I think they’re fucking you, and you can’t do anything about it if you’re not prepared to go through a lot of shit. It’s up to you. Either you let them push you around, or prepare for a difficult fight.

You should have the withholding certificate for 2010 in your hands by now. You won’t receive any paperwork for 2011 until 2012. I’m assuming the school is in Taipei, and that you live in Taipei.

Bear in mind that you cannot renew your ARC if you don’t have a certificate from the Tax Office to say that you paid your taxes. Taxes are due soon, so you need the withholding certificate. Your employer should give it to you on request.

If your employer doesn’t give you the certificate, then the tax office has all the necessary information on their computers anyway. You can go to the office and give them your passport, and they will tell you what income was reported for you last year and what tax was payable. Then you can call your employer and ask about any discrepancy. They will come up with some bullshit about their internal accounts, so you need to calculate what the real tax payable was for yourself and compare that with the amount deducted.

If the reported income is different from what they really paid you then you can appeal. I have done this. You just write a one-page summary, and they go off and investigate. It took about two months before they reported back that I was correct and everything was hunky-dory.

You need to look carefully at your ARC and work permit and see who your legal employer is. Agents usually use front companies, and you are most likely working illegally. You need to supply the tax office with as much info as possible about who you’re really working for. When I did it, nobody took any notice of the legal status of the work, and immigration was not involved. Your mileage may vary.

While the appeal is in process, you can’t get the certificate of tax paid, because your taxes are not resolved. This means you won’t be able to renew your work permit or get a new one. If you complain about your agent, you will probably get fired and they will cancel your work permit. So then you get ten days to leave the country. I didn’t have quite that problem, but I was unable to renew my WP for a time, and had to go to HK for a visitor visa. The nice lady in the HK visa office had problems with finding a reason to give me a visa, but eventually came up with “but you have to go back and pay your taxes.” You may be able to get a visa at the office in Taipei, without leaving the country. (They’re lovely people too, the lady there gave me NT$2 for photocopying on my last visit.)

If you get fired because you want them to pay the proper taxes, then you have a case for unfair dismissal. You can take this to the Labor Department. You need the fifth on this page - english.dol.taipei.gov.tw/ct.asp … &mp=116002

I went through this some years ago, and met two officials from this office last week. They actually recognised my name and remembered the case. Again, they’re nice people doing a job. Actually, in my case it was an underpayment for a contract job and part of my complaint was that the employer didn’t apply for a work permit. There was no legal reason why he shouldn’t, and no benefit to me in working illegally. The immigration department were involved, and declined to take action against me. I won my case, and got paid. But it was a scary time.

In the event of a complaint to the Labor Department, the place where the work takes place is deemed to be the employer. So your school will be the first place to get investigated. They don’t want this, and when you tell them that it’s going to happen then they will panic and hate you for causing trouble. In 99.9% of cases, they will take the view that your taxes are between you and the agent and it’s wrong of you to involve them. The fines for illegally hiring a foreigner are nasty, and school principals can go to jail (in theory) if they get caught a second time. Bringing that crap down on them will never be forgiven. The agent will also get into a lot of trouble. Even suggesting that you’re speculating about the possibility of considering taking action will appall them, and you’ll get fired.

(NB If your legal employer is different from the school, then it may be in another city. The Labor Department may try and tell you to go and complain there, but you should insist that you don’t know who you really work for and that the work was actually done in Taipei.)

So, really, you’re fucked. But if you present a brave polite face to your agent, and tell them that you don’t mind being fucked, then they have to deal with the fact that you can fuck them too. If you clearly know what the procedures and options are, and appear prepared to follow through, then they will see that it’s easier and cheaper to just pay you off. They’ll probably refund you all the money, and then you go to the tax office and make a voluntary declaration of income. Of course, they won’t be nice about it.

You can let this wait until the end of the semester, as the fee for filing your taxes late is pretty small. Also, now is the busy time for them and everyone will be a bit stressed. Leave it until June, and they’ll be much more receptive. Plus you will have time to line up a new job. I would ask your agent for the withholding certificate NOW, because you need it to get a work permit for the new job you have already lined up for next semester, but hold off on any action for now if the result isn’t what you want. I assume you’re also waiting for some year-end bonus? Get that first.

Do everything by email, not by phone. Document everything that happens from now on. Build a case to show that you have tried to be reasonable and work within the law. Accept that you can’t solve this and keep your current job. Prepare an exit strategy and contingency plans. Stay calm, keep smiling. Do more research about your options. Don’t let them bully you.

Oh, and a purely personal opinion: If they say X and you say Y then only one of you can be right, and being corrected by a lowly foreigner is the worst thing that can happen to the average Taiwanese. This is not just about the money, it’s about face, and I’ve found that when you press people to admit fault in this country they go postal.