Working remotely for US company from Taiwan - issues?

Work Working in Taiwan
#1

Hi, I am looking to go to taiwan for a few months to stay with family. I currently live and work in NYC but I have been remote working since March.

My question: would my working remotely from Taiwan for my non-taiwan company pose any issues for my company? My company does not have any offices or branches or subsidiaries in Taiwan.

I am fine with paying taxes in Taiwan so thats not the issue. The issue is whether my company would have any problems with it. Would greatly appreciate if anyone has been through this and has experience to share.

#2

That‘s something only your company can really decide.

In theory with international tax law, having an employee in another country could be considered as establishing a fictitious branch office in that country. And that might come with all kinds of consequences such as the company having to pay local taxes on the income generated by that local branch office (i.e. based on the „value“ you create while residing in Taiwan).

I haven’t been able to find out though how exactly this is handled in Taiwan. Probably not much risk of getting audited though in that kind of situation, I guess.

Probably easiest if you keep paying all taxes etc. in the US - then taxes due in Taiwan should probably be close to zero as you should get credit for the US taxes paid. And I guess some people would just recommend not declaring the income at all in Taiwan - seems to be what many people are doing.

But to be on the safe side, better talk to a tax attorney or accountant in Taiwan who also specializes in US taxes.

Ah, and if you stay in Taiwan for less than 90 days, there shouldn’t be any tax liability. In that case, I probably wouldn’t worry about anything if your company is fine with your plan.

#3

Since your company doesn’t have a legal entity in Taiwan, it cannot officially have people located in Taiwan working for it.

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#4

Is that a legal or regulatory rule? I know other people in my firm who are working from other countries

#5

Some U.S. companies prohibit their employees from taking company phones and computers abroad out of concern that company data may be at risk and lost. You may also need to be prepared to use encrypted email, if that is normal work protocol.

#6

I’ve just done a few months as a remote worker in Taiwan for a Canadian company myself. I returned just a couple of months ago to Canada. Here was my experience:

On the Taiwan side there was no issue. I wasn’t technically working in the legal sense in Taiwan since I’m a Canadian employee working for a Canadian employer being paid in Canada. So I entered on a visitor visa, so there were no taxes or paperwork involved.

The Canadian side was more difficult. It certainly did matter to my employer because if I was to move there, I would be technically working there and then there would be a whole slew of legal and administrative requirements that they would need to comply with to support my employment in Taiwan.

My solution was to find out how long I could exit Canada (and my province) without losing residency status – specifically for taxation and healthcare – and visit Taiwan for a lesser period. The argument goes, “if I leave for 2 week then the company is cool and the government’s cool. What if I leave for 3 weeks, or 3 months? At what point would my status change? Let me be gone for up to that time”. My company agreed and we drafted up a memorandum of understanding that I would return to Canada before the agreed upon date (I’m grateful for my employer in humouring me on this. They consulted external legal advice and took a chance that I wasn’t taking off forever). I think it helped that my job used to have a fair bit of travel already, back when we did that kind of thing.

You wrote that you’re thinking of just a few months. So I’d recommend the same: lookup the residency requirements in New York (or rather when they would expire if you left, especially for taxation) for your situation and approach your company likewise to propose your plan and see if they have a policy in place for this already. It would go a long way if you show you did your research first and propose a guaranteed return date which would free them of some of the anxiety of HR or legal consequences of the unknown.

And don’t forget to look into healthcare options for Taiwan: paying into Taiwan’s system if you can, private insurance, or if existing coverage from your employer covers you internationally and for how long.

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#7

This is kinda funny. US and Canada are very different, and the short answer here is that they don’t expire. People have to fight tooth and nail to prove that they’ve left. Even if they spend the majority of the year in another state, people have to show they’ve cut ties with the state and have made a permanent residence elsewhere.

My wife lived in Los Angeles from 2008-2009. Literally last month she had several thousand dollars seized from her Bank of America account. When we researched we discovered it came from some court order and we could follow up with some third party. Turns out it was the California tax department claiming she was delinquent on taxes! Was a pretty easy fix thankfully cause we were able to show that she has had no connection to the state in the last decade, but yeah, these high tax jurisdictions are ruthless.

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#8

Wow, that’s quite a story! I’m glad it was an easy fix.
That’s a good point about jurisdictional differences. I’d recommend the same approach but to make sure, as projectmaximus pointed out, that the information is specific to where you are – find out what qualifies you as a New Yorker as far as employment law goes, research what it would take to change that qualification (if anything), and talk to your employer about working remotely for them in under that threshold. Of course this is just one suggestion or way to go about it.

#9

Assuming you were here for <90 days in a year? Exceeding that threshold, taxes start being due in Taiwan.

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#10

Taxes have to be filed past 90 days, but tax treaties might mean that you’re not paying out to two countries. For Canadians, this situation is covered under Section 15 of the tax treaty between Taiwan and Canada so that they only owe money to Canada (no one should take my word as legal advice for themselves and their individual situation, nor rely on an internet forum for such). I have no idea what agreements the United States have with Taiwan. This would be another point to look up that might influence going.

Thanks for sharing that link and bringing this up. That was an omission on my part.

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#11

US has no formal agreement with Taiwan. But the FEIE, FHE and FTC (tax credits) still apply so that you will in essence not be double taxed.

#12

I’m in a similar situation. I was born in Taiwan, and will be able to obtain a Taiwan passport. My parents currently live in Taiwan. I work for a US company and will be paid in USD to a US account. I want to work in Taiwan full time remotely. My US company does not have an office in Taiwan. Do I need a work permit? Do I need to file taxes in Taiwan? What effect would working remotely in Taiwan have on my US company?

Thanks.

#13

Yes

Yes, if here over 90 days in a calendar year

You should speak with your company about this