Taiwan

Social security contributions

There are compulsory social security programs that require contributions from employers and employees based on monthly insured salary, which is capped at various amounts. Taiwan social security programs include the Labour Insurance Program (LIP), National Health Insurance Program (NHIP), and Labour Pension Program (LPP). However, foreign individuals are not eligible for participating in the LPP.

Starting from 1 January 2021, under the Second Generation National Health Insurance Program, a supplementary premium of 2.11% is applicable on bonus or incentive payments exceeding the monthly insured salary by four times (capped at TWD 10 million) on an accumulated annual basis for the employee. In addition, Taiwan local employers are required to contribute a supplementary premium of 2.11% on the difference between total monthly taxable salaries and employees’ monthly total insured salaries.

Business tax

All sales of goods and services in Taiwan, as well as the importation of goods into Taiwan, are subject to business tax. There are two types of business tax systems: value-added tax (VAT) and gross business receipts tax (GBRT).

See the Other taxes section in the Corporate summary for more information.

Value-added tax (VAT)

The standard VAT rate is 5%.

Gross business receipts tax (GBRT)

GBRT is applicable to specified industries (e.g. financial institutions, small businesses) at rates ranging from 2% to 5%.

Net wealth/worth taxes

There are no net wealth/worth taxes in Taiwan.

Estate tax

The net estate, after exclusions, applicable deductions, and exemptions, is subject to the following progressive tax rate:

Prior to 12 May 2017, the tax rate was 10%. 

An exemption amount is set at TWD 13.33 million for each decedent. Deductions include the following:

• TWD 4,930,000 for surviving spouse.
• TWD 500,000 for each lineal descendant and an additional deduction of TWD 500,000 for each year starting from the current age of each lineal descendant up to the age of 20. 
• TWD 1,230,000 for each surviving parent.
• An additional TWD 6,180,000 for each qualified handicapped or mental patient heir.
• TWD 500,000 for each of the dependent brothers, sisters, and grandparents of the decedent and an additional deduction of TWD 500,000 for each dependent brother and sister for each year starting from the current age of each such brother and sister up to the age of 20.
• TWD 1,230,000 for funeral expenses.

Gift tax

An annual exemption amount is set at TWD 2.44 million per donor. The net gift, after exclusions and exemptions, is subject to the following progressive tax rate:

Prior to 12 May 2017, the tax rate was 10%.

Property tax

A tax is levied on land and buildings annually. The land tax rate ranges from 1% to 5.5% of the assessed land value. The building tax rate for commercial properties is 3% to 5% of the assessed value, and the rate for non-commercial properties is 1.2% to 3.6% of the assessed value.

Luxury tax

Selective goods and services tax (also known as luxury tax) of 10% applies on various luxury products, such as upscale automobiles, yachts, private jets, helicopters, fur, ivory, high-end furniture, and membership rights.