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From Digital Nomad to Real-Life Worker

ROC taxes, overseas payment of taxes, withholding rates, general tax liability issues, and other tax-related matters
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From Digital Nomad to Real-Life Worker

Postby shrimp_crackers3 » 16 Jun 2016, 17:02

Hi All,

From 2013 to early 2015 I was doing the digital nomad thing. I was a good boy: always leaving the country before my 90 days were up, and filing taxes in my home country. But now I work at a big Taiwanese company, and a recent visit to the tax office might have me in trouble.

Here's the deal. In may I filed my taxes, and things went smoothly. In fact I have a nice sized refund on it's way.

Recently, however, I went to go get a tax certificate for my earnings in Taiwan and there were some problems. The tax office wanted me to declare my income in 2013-early 2015. I gave them some vague answers: cultural immersion, and freelancing for an overseas company. Now they say I have to come to the office with some proof of income.

1) How much income should I declare? I also have some savings, so I could say I was living off of them. Of course I don't want to lie/commit fraud but it's never a good idea to volunteer too much information to the authorities.

2) Potentially, what am I looking at for a fine?

3) Any other tips to mitigate the damage?
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Re: From Digital Nomad to Real-Life Worker

Postby randomphil » 19 Jun 2016, 17:02

If your country has a double-taxation agreement with Taiwan and you declared your taxes in your home country between 2013 and 2015, you should be able to get out of this by submitting the tax certificates from your home country.

In most cases, they just want to know you declared your income and paid taxes on it. (And even if they are looking to make $$$ from you, most double-taxation agreements will have some amount that you have to exceed before you can be taxed in the second country. Chances are you will be below that amount.)
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Re: From Digital Nomad to Real-Life Worker

Postby shrimp_crackers3 » 22 Jun 2016, 13:47

So for anyone that's in my situation it's a good idea not to listen to the guys in the tax office and make sure you have an accountant help you with this? Why? They denied that the under $1 million rule for foreign income exists, ignored any deductions, and treated it as code 50 which means salary (what about being self-employed), and hit me with a huge tax bill. They said I had an option for a 3 month deferral to which I said "OK" and left. They didn't offer to give me any official notice/letter saying what I owned and when I'd have to pay it. So... lol.
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Re: From Digital Nomad to Real-Life Worker

Postby Brendon » 22 Jun 2016, 22:46

I mean, I think they're right though, aren't they? You were living in Taiwan when you did the work, so you should have paid tax on it here. You could probably then have deducted that from tax you owed back home, depending where home is.

Freelancing for foreign companies is very easy to just not report, and thereby (illegally) evade local taxes, but now that you've told them about it ...
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Re: From Digital Nomad to Real-Life Worker

Postby shrimp_crackers3 » 23 Jun 2016, 11:00

Well the subject of if it's taxable in Taiwan is up for debate. However assuming for a moment that it is taxable then it would count as self employment, not salary, and would be subject to some big time deductions.
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Re: From Digital Nomad to Real-Life Worker

Postby cfimages » 23 Jun 2016, 11:24

Freelance doesn't really exist in the Taiwan tax code, AFAIK. To be self-employed to the tax office's standards you need to be a registered business here.
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Re: From Digital Nomad to Real-Life Worker

Postby HenHaoChi » 23 Jun 2016, 11:41

I wondered what their tone was like when they were dealing with you, shrimp_crackers. Were they suspicious and probing, or did they just lazily stick you with a bill? Did it look like they saw this situation every day?
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Re: From Digital Nomad to Real-Life Worker

Postby shrimp_crackers3 » 23 Jun 2016, 11:54

HenHaoChi wrote:I wondered what their tone was like when they were dealing with you, shrimp_crackers. Were they suspicious and probing, or did they just lazily stick you with a bill? Did it look like they saw this situation every day?


They were somewhat familiar with digital nomads/remote workers. They weren't suspicious, and they were actually quite friendly trying to work towards a solution. They didn't offer any deductions, and refused to acknowledge the 1 million overseas income rule, but they did offer a few options such as saying I took care of my parents or showing other dependents.
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Re: From Digital Nomad to Real-Life Worker

Postby HenHaoChi » 23 Jun 2016, 12:30

That's interesting. I have had the same experience with 98 percent of Taiwanese government employees. I guess you would be friendly towards someone you were about to hit with a large tax bill. But it's good to know they have seen this situation before.
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Re: From Digital Nomad to Real-Life Worker

Postby kelake » 23 Jun 2016, 13:44

Charging you income tax when your legal status is tourist. Thats new. I guess I owe the Thai government a small percentage for all those times I brought my laptop when visiting the kingdom.
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