Hi all, I am married to a Taiwanese citizen and planning to move to Taiwan on a joining family visa, and getting an ARC. I work in a consulting role with a foreign company (not a direct employee, but a hired consultant). The company has no business, nor will have any business in Taiwan, I will just be carrying out my work from Taiwan remotely on contracts in other parts of the world.
How can I go about legalizing my situation in Taiwan in terms of getting paid and paying taxes? Ideally, I would like to be able to have a Taiwanese bank account, receive funds in US$ and convert to TWD. I also would obviously want to ensure I am compliant from a tax perspective and have a way to pay tax. Is it a potential option for me to set up a company in Taiwan or would this complicate things?
Has anyone done anything similar to this or know how it would work?
Open a branch office in Taiwan should get you the necessary living privileges here. You’ll need a CPA to get started.
Here is the CPA I recommend. He speaks English.
He doesn’t need to do that as he is coming on a JFRV. He has open work rights.
If he wants to be tax compliant he can just declare his overseas earnings with the tax authorities. No need to set-up any company or rep office.
Thanks, is it just as simple as that? Will I be able to open a bank account in Taiwan using my foreign contract to show my earnings?
You don’t need proof of income to open an account. It’s free as well.
Once you get your ARC and an address it’s a piece of cake. Even without an ARC it’s possible but I would just wait till you get your ARC so you can register it with your ARC number and of course your passport number and address etc.
It’s probably easier to open an account with your wife’s help or as a co-signer on the US$ account.
Consider setting up a company, you can (legally) reduce your tax bill and even get VAT refunds on your business expenses (payments from foreign companies to your company are 0% VAT). You just need to hire an accountant to do the VAT returns (typical rate NT$2,000/month).
Setting up a company and doing all that stuff is a bit painful. Some local governments will hassle you if you aren’t actively trading. Taichung used to do that to me. You also need to register a business address with the company .
Some might just decide to declare some portion of income and that is that. Or they declare all of it. If is up to them to follow any legal obligations .
Its not like Taiwan authorities are actually even checking any of this stuff, they will be impressed you even declare anything .
You can also do a joint tax declaration with the wife and get tax deductions if you include her side of the family or if you have parents over (I think 70>), over a certain age.
You need to figure out your own NIH premiums and also you could think about contributing to the labour insurance scheme if planning to stay long-term.
Since OP is working from Taiwan it will be considered local earning. Rather than that, there is a freelance status, just keep records, report income yourself for tax, or get an accountant to do it.
Yes exactly, I set up a company previously because I billed Taiwan clients also , he doesn’t need to do that. He is a freelancer with income coming from outside Taiwan.
If you are receiving income every month for consulting, then this would count as active trading. Business address is easily solved if you or a family member owns a property it can be registered at.
Accounts are a bit of a hassle for foreign sourced payments to companies. You have to provide proof that the payment came from abroad etc.
The advantage is that it’s entirely legal and you can refund VAT on business expenses.
If you don’t set up a company, you can just declare your foreign income each year when you file your tax returns. The tax office might be quite surprised at your honesty, because most people don’t declare foreign sourced income from working in Taiwan (wrongly) believing that this is not liable for income tax. In reality, the tax office don’t seem to care and no one is checking.
Yes but then their property tax also changes. I have experience of this it’s a bit of mafan…There’s no good reason for him to setup a company and there are quite a few costs involved.
And yes as I mentioned already the tax office doesn’t seem to care too much as long as you are not sourcing the income from working in Taiwan from Taiwan itself .
Some people prefer to do everything 100% legally, in which case a company might make sense, especially if you are on a high income. However, it’s true that tax evasion is rampant here (and much less of a social stigma than in the West). Most Taiwanese don’t even declare domestically sourced income if they can get away with it. The tax office doesn’t seem to check or care.
The property tax is not affected by registering a company at the address any more. I registered my company at my in-laws house and their property tax was not affected.
Thanks for all the tips everyone, glad to hear that it is probably more straightforward than I had imagined!
When it comes to taxes, Taiwan is very straightforward. Just be aware the huge difference between how they treat income earned from Taiwan versus outside Taiwan, and you are good. And even then well there is a lot of tax evasion here, which is illegal, but that is a fact.
Especially as you are married and on a JFRV, they really won’t hassle you much. It’s up to you to be tax compliant we cannot advocate breaking the law here.