Newsletter
PREFERENTIAL TAX TREATMENT FOR FOREIGN SPECIALISTS
As a part of the efforts to make up the shortage of specialists, gain new technologies, enhance the development of Taiwan enterprises, and elevate Taiwan's competitiveness in the international markets, the Executive Yuan approved at its 27 June 2007 meeting the Measures to Attract Foreign Specialists to Work in Taiwan proposed by the Council for Economic Planning and Development. On 8 January 2008, the Ministry of Finance (MOF) issued tax rulings on the scope of preferential tax treatment for foreign specialists pursuant to the Measures with the following main points:
‧The term "foreign specialists" does not include ROC citizens with dual nationalities.
‧Payments made by an employer to a foreign specialist pursuant to an employment contract, including (i) round-trip travel expense for the foreign specialist and his or her family members to relocate to Taiwan, (ii) travel expense for the foreign specialist and his or her family members to return to their home country for vacation after working for a contractually agreed period of time, (iii) relocation expense, (iv) utility, telephone and cleaner's charges, (v) rental and cost of repairs to rented accommodation, and (vi) tuition for his or her child/children's schooling, can be declared by the employer as its operating expenses, and not as taxable income of the foreign specialist. The employer should duly record each payment of such expenditures on its books and obtain and retain receipts and documents for such payments.
‧A qualified foreign individual under the Measures is one who is a (1) lawyer, (2) technicians, (3) veterinarian, or (4) chef of a catering enterprises, or a specialist in the field of (5) construction or architectural technology, (6) transportation, (7) fiscal, taxation and financial services, (8) real estate brokerage services, (9) immigration services, (10) healthcare, (11) environmental protection, (12) cultural, sports and leisure services, (13) academic research, (14) manufacturing, (15) logistics services, (16) management of enterprise invested in or establish with government approval by any overseas Chinese (Taiwan citizen living or returned from abroad) or foreign national, (17) management, design, planning, or consultancy for a specialized, scientific, or technical service enterprise, or (18) any other field designated by the Council of Labor Affairs in consultation with the central competent authorities.
A qualified foreign specialist must reside in Taiwan for at least 183 days within a tax year, and has a minimum monthly taxable (in Taiwan) salary of NT$100,000, unless otherwise allowed by the MOF under special circumstances.