Q: How should foreigners declare individual income tax when receiving income such as manuscript fees, royalties, music scores, compositions, scripts, comics, or hourly lecture fees?
A: Regardless of whether the foreigner is considered a "resident individual of the Republic of China (Taiwan)" or "non-resident individual," if the total annual income from manuscript fees, royalties, music scores, compositions, scripts, comics, or hourly lecture fees does not exceed NT$180,000 per person, the entire amount is tax-exempt.
If the income exceeds NT$180,000:
● For resident individuals, the excess amount may be deducted based on actual cost and expense certificates to determine the business income. Alternatively, 30% of the cost and expenses may be deducted, and the remaining amount reported as business income. For self-publishers, 75% of the cost and expenses may be deducted before reporting the remaining amount as business income.
● For non-resident individuals, the amount exceeding NT$180,000 is treated as business income after deducting NT$180,000.
Q: How is service compensation for foreign workers calculated?
A: The service compensation for foreign workers is calculated based on the withholding certificate, certified employment contract, or other credible income certificates for individual income tax assessment.
If none of these income proofs are provided, the following standard amounts are applied:
● In 2024: NT$27,470 per month for non-resident individuals NT$41,205 per month for resident individuals.
● In 2025: NT$28,590 per month for non-resident individuals NT$42,885 per month for resident individuals.
Q: How should foreign workers declare individual income tax if they terminate employment before the contract ends?
A: Foreign workers must declare taxes based on their income before resignation using income certificates. If unable to prove no income after resignation, the Ministry of Finance&rsquos standard income amount will be used for tax assessment.
Service Compensation for Foreign Workers (Image / Sourced from Freepik)
Q: How is individual income tax imposed on foreigners who rent out land and buildings?
A: Rental income from land and buildings for foreigners is classified as rental income and is subject to individual income tax.
For resident individuals:
● Land rental income is calculated by deducting land value tax for the year from total annual rental income.
● Building rental income is calculated by deducting necessary expenses such as depreciation, repair costs, land value tax, house tax and its surcharges, property insurance, and mortgage interest from total rental income. If no proof of expenses is provided, a standard deduction of 43% may be applied, and tax is assessed on the remaining 57%.
● If deposits or similar payments are collected, interest calculated using the one-year fixed postal savings rate (1.600% for 2024) must be included in rental income unless properly declared otherwise.
For non-resident individuals, rental income is taxed at 20% of the payment amount with no deductions allowed.
Q: How should foreigners declare income from selling land and buildings if not subject to the consolidated housing and land tax system?
A: For foreigners selling land and buildings outside the scope of the consolidated housing and land tax system:
● Land sale income is tax-exempt.
● Building sale income is considered property transaction income and is subject to individual income tax.
Property transaction income is calculated by subtracting the original purchase cost and expenses from the selling price. If the taxpayer provides valid documents proving the actual transaction price and costs, and the tax authority verifies them, the income is calculated accordingly.
