Easily manage employment in Taiwan

Payroll services in Taiwan

Taiwan is a dynamic economy driven by advanced manufacturing, technology, and international trade. Its regulatory environment includes detailed labor laws, social insurance obligations, and progressive income tax requirements. To manage payroll correctly, employers need a clear understanding of minimum wages, working hours, social contributions, and tax withholding. That ensures legal compliance, smooth payroll operations, and avoids penalties.

Payroll breakdown in Taiwan

Employers in Taiwan must follow national payroll regulations concerning minimum wage, working hours, overtime, taxes, and social contributions. Here’s a streamlined overview:

Minimum wage and working hours

• Minimum wage: As of 1 January 2025, the monthly basic wage is NTD 28,590, and the hourly rate is NTD 190.
• Payroll frequency: Salaries are typically paid monthly, often by the 15th of the month.
• Working hours: Standard workweek is 8 hours per day and 40 hours per week. Overtime rules cap combined daily hours at 12 and monthly overtime at 46 hours (with a 138‑hour limit across three months). 

Overtime pay

• First 2 hours of overtime on a regular workday: 1.33× regular hourly wage.
• Following hours same day: 1.66 –1.67× regular rate.
• Flexible rest‑day work: 1.33× for first 2 hours; 1.66–1.67× next hours.
• Fixed rest day or national holiday: 2.66× the regular hourly rate.

Taxation and social security contributions

Individual income tax (withholding by employers):

• Residents taxed progressively between 5%–40%, with top brackets up to 45%. 
• Non-residents face a flat 18% tax on Taiwan‑sourced income.

Employer contributions include:

• Labor Insurance: total ~11.5% of insured salary; ~8.05% employer share; ~2.3% employee; rest by government. Caps apply (e.g., NTD 45,800). 
  
• National Health Insurance: total ~5.17%; ~4.84% employer; ~1.55% employee; plus government subsidy.
  
• Employment Insurance: employer ~0.7%; employee ~0.2%. 
  
• Labor Pension (Individual Pension Account): employer contributes minimum 6%, capped at NTD 150,000 monthly; employees may contribute voluntarily up to 6%. 

Payroll compliance and record-keeping

• Employers must register with relevant authorities (Ministry of Economic Affairs, National Taxation Bureau, Bureau of Labor Insurance, National Health Insurance Administration) before hiring.
  
• Employment contracts should be written, especially for foreign workers, supervisory staff, or flexible arrangements, and detail salary, working hours, benefits, overtime, termination terms, and dispute resolution.
• Payroll records, payslips, tax filings, and social contributions must be retained (typically for at least five years). 
  
• Social insurance salary bases (for labor insurance, health, pension) must be reviewed and adjusted at least twice a year, based on the 3‑month average salary. 
  
• Employee payslips must include breakdowns of taxable income, social insurance, unused leave payments, employer and employee details.

Quick facts: Important considerations for employers

• Payroll cycle: Monthly, typically paid by the 15th.
• Currency: New Taiwan Dollar (NTD).
• Minimum wage: NTD 28,590/month; NTD 190/hour (as of Jan 1, 2025).
• Working hours: 8h/day, 40h/week; overtime limits apply.
• Overtime pay: Ranges from 1.33× to 2.66× depending on timing.
• Taxation: Progressive for residents (5%–40/45%); flat 18% for non-residents.
• Social contributions: Employer pays for labor insurance, health insurance, employment insurance, pension; employees also contribute.
• Record‑keeping: Payroll records must be accurate and retained; social insurance bases must be updated twice yearly.
• Contracts: Written agreements required for many roles and must align with the Labor Standards Act.

Run payroll in Taiwan with Remote

Managing payroll in Taiwan means navigating detailed labor law, social insurance obligations, and tax requirements. You must stay compliant with working hours, minimum wage, contribution rates, and contractual best practices.

Remote supports compliant hiring in Taiwan with tools, localized expertise, and the ability to pay your team accurately and on time, no matter where they are. Discover how smooth payroll can be with Remote: book a demo today.