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Our staff are experts in fields ranging from operations, payroll, accounting, and more. Learn what you need to expand your business and hire staff in Taiwan.
Taiwan, is an island in East Asia in the Western Pacific Ocean covering a total area of 36,193 square kilometers. Taiwan is also known for its friendly locals and for being a city that is culturally diverse and open-minded.
Employees can be majorly divided into two categories – Contractors and Employees and defining relation with the employee is very important to avoid risks associated with misclassification.
The courts in India have applied the control and integration test to determine whether a person can be classified as an employee or independent contractor. The prima facie test is the control test to determine whether an employer-employee relationship exists and it is not merely to direct the nature of work that has to be carried out but also to control the manner in which it is done.
Another difference between an employer and contractors is an employer is required to withhold tax at the time of payment of salary to employees. The salary paid to an employee may include benefits and allowances that the employee is entitled to, which is beneficial to the employee from a tax perspective. However, with respect to independent contractors, the employer must withhold the applicable taxes; however, the amount paid may not be in the form of salary, but as professional fees for services performed. In both these cases, the employee and independent contractor/s will be required to file their income tax returns as prescribed under law.
The payroll cycle in Taiwan is generally monthly, and payments are usually paid on the 15th of each month.
As you outline a Taiwan benefit management plan, you must include the statutory minimums concerning time off, maternity and paternity leave, health insurance, and similar facets. Taiwan has nine public holidays during which employees receive the day off. All employees also receive paid annual leave based on their number of years of service with the company.
An employer is required to deduct and withhold income tax from employees. The employer is liable to administer the payment to the tax office for taxes withheld from employees before the 10th day of the following month.
Individual income tax (IIT) is levied on Taiwan-sourced income of both resident and non-resident individuals, unless exempt under the provisions of the Income Tax Act and other laws.
The LSA is Taiwan’s primary source of employment law, as such it gives both parties rights and provides guidelines on how the parties are to conduct themselves in the employment relationship.
An employer may not dismiss an employee without good cause. Whether the employer is required to give advance notice when terminating the employment relationship will depend on what reason the employer gives. The employee’s service years will determine the required advance notice period.
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