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[Income Taxes] 183 day Rule

ROC taxes, overseas payment of taxes, withholding rates, general tax liability issues, and other tax-related matters
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Re: [Income Taxes] 183 day Rule

Postby Abacus » 11 Aug 2013, 15:52

The last 3 questions (Michal, mukashi and purple hoodie) all relate to the same confusing part of the taxes. Your school will still withhold 18% of your paycheck for the first 6 months every year that you are in Taiwan. It doesn't matter if you have been here for 3 years. Every year it resets because it's impossible to know if someone will go home during the first six months. It sucks but you get the money back (over 1 year later...). There might be some buxibans that don't do this but they are liable for any unpaid taxes if their employee leaves the country w/o paying (this happens).

There might be an exception to the 18% for APRC or JFRV holders.
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Re: [Income Taxes] 183 day Rule

Postby ralf1970 » 16 Oct 2013, 14:50

After I have stay longer than 183 Days in TW then the Tax will go down from 18 %. Right ??

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Re: [Income Taxes] 183 day Rule

Postby mukashi » 16 Oct 2013, 16:17

ralf1970 wrote:After I have stay longer than 183 Days in TW then the Tax will go down from 18 %. Right ??

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Ralf, from what I am understanding after working in here for over 3 years and having paid taxes for two already... my answer is yes and no.

In a way "yes" because every year for first 6 months companies can deduct 18%. Then second part of the year it goes down to the usual % (5 or 6 I think).

But "no", because in the end you will need to pay only the 5 or 6 % per whole year, and the money that was deducted extra (difference between 18 and 5-6%) will be returned (so for this year, it would be returned around July 2014).

Also "no", because some companies (like mine) don't deduct tax from my salary at all, so I just have to pay normal 5-6% from the whole year when the time comes (May 2014 for this year).
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Re: [Income Taxes] 183 day Rule

Postby Abacus » 16 Oct 2013, 23:53

ralf1970 wrote:After I have stay longer than 183 Days in TW then the Tax will go down from 18 %. Right ??

Greetings
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It should (if the school is deducting correctly) but the 183 day rule restarts each tax year so expect 18% taken out of your January paycheck again.
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Re: [Income Taxes] 183 day Rule

Postby Taipei123 » 09 Apr 2014, 17:27

My question is so I need to pay taxes after 183 days. What if I am working for a US based company and I am not making any income in Taiwan? Does that mean my US income still gets taxed 20%?

My line of work is more commission based, so for any tax experts out there, is there away I could classify this commission in order to make it tax-exempt? I have heard that titling commission instead to business development will make it tax-exempt.
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Re: [Income Taxes] 183 day Rule

Postby icinterac » 16 Oct 2014, 17:38

Hi,
I hope you can help and provide me some orientation with this question I have:

I am working for a Taiwanese company that has offices in Europe as well. This year I worked at one of their European offices (I went to Europe during 8 months) and during this period I received my salary as if I were in Taiwan, when I came back and they told me that I will have to pay the 18% of taxes because of the 183 days rule, which gives a crazy high amount of money. However I will be leaving Taiwan for good in two months.

-Is there any way to avoid or negotiate to reduce this 18% tax? Last year I made my tax declaration, and stayed over 183 days... does this help?
-What is the procedure before or after I leave to pay these taxes? Will I have to pay them before leaving Taiwan, or with the e-filling next may 2015?
-What are the risks of not paying this? (I will not come back to Taiwan)

-Any advice??

Thanks!
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Re: [Income Taxes] 183 day Rule

Postby Abacus » 16 Oct 2014, 18:00

the risk is that your company will have to pay the tax.

You can go to the tax office with a plane ticket and file taxes early (my understanding at least).
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Re: [Income Taxes] 183 day Rule

Postby jlick » 16 Oct 2014, 19:46

You may not wish to pursue this as the alternative is to be considered a European resident during the time in which case you'd pay European tax rates on the income which may well end up being higher. Technically you should not owe any tax in Taiwan on income for work performed abroad, but since you were paid as if it was performed locally the only way out would be to prove you'd been resident and paid taxes on the income already in a foreign country. Your company should have already been withholding 18% of your income towards the tax. If not, they would be on the hook for the difference if you leave without filing a return and paying it yourself.
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Re: [Income Taxes] 183 day Rule

Postby taiwangirl » 30 Jun 2016, 11:42

would like to know if on 31st Dec you are not in Taiwan , does your tax exemption would be calculated based on days stay in taiwan ?
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Re: [Income Taxes] 183 day Rule

Postby jlick » 30 Jun 2016, 14:31

taiwangirl wrote:would like to know if on 31st Dec you are not in Taiwan , does your tax exemption would be calculated based on days stay in taiwan ?


It doesn't matter if you are in Taiwan on Dec 31 or not. It just matters how many days you were present in Taiwan total in one calendar year.
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