This article provides a clear overview of Taiwan’s individual income tax system for 2025, focusing on rates, brackets, surcharges, and key features based solely on current available data. All figures are in New Taiwan Dollars (TWD), with international and resident taxpayer scenarios addressed.
Framework of Individual Income Tax in Taiwan
Taiwan operates a progressive individual income tax system assessed on total income. Tax rates increase with higher earnings, ensuring taxpayers face higher percentages as their income rises. The following sections detail these brackets, supplemented by supplementary taxes applicable in certain situations, particularly for non-resident taxpayers and those with significant foreign-sourced income.
2025 Taiwan Individual Income Tax Brackets
The progressive rates for Taiwan’s individual income tax in 2025 are outlined in the table below. Each bracket shows the relevant taxable income range and the corresponding tax rate:
| Taxable Income Range (TWD) | Taxable Income Range (USD)* | Rate (%) |
|---|---|---|
| 0 – 590,000 | $0 – $18,600 | 5% |
| 590,001 – 1,330,000 | $18,601 – $41,900 | 12% |
| 1,330,001 – 2,660,000 | $41,901 – $83,800 | 20% |
| 2,660,001 – 4,980,000 | $83,801 – $156,900 | 30% |
| 4,980,001 and above | $156,901 and above | 40% |
*USD conversions are approximate, based on an exchange rate of 1 TWD ≈ 0.0315 USD. Always confirm the latest rates for precise planning.
Surtaxes and Special Taxation Rules
In addition to regular progressive rates, Taiwan applies specific surcharges based on individual taxpayer status and income source. The following table summarizes key surtaxes currently in effect:
| Condition | Rate (%) | Description |
|---|---|---|
| Non-resident alien in Taiwan < 90 days/year | 18% | Withholding tax on salary paid from a Taiwan-registered entity |
| Non-resident alien in Taiwan > 90 but < 183 days/year | 18% | Flat tax rate on Taiwan taxable salary income |
| Resident with foreign-sourced income ≥ TWD 1,000,000 and basic income > TWD 7,500,000 | 20% | Income Basic Tax (IBT) applies to qualifying foreign-sourced income |
Income Assessment and Residency Status
Tax is assessed on income earned, irrespective of source, but residency fundamentally impacts the applicable rate and calculation method. Residents are subject to the progressive bracket system detailed above, while non-resident aliens may face flat surcharges, especially if their presence in Taiwan during a given calendar year is limited. Residency is generally determined by presence in Taiwan for at least 183 days in a year.
Key Facts and Numbers for 2025
- Progressive tax rates range from 5% to 40% for residents, depending on income level.
- Non-residents typically incur a flat 18% withholding on earned income, depending on length of stay.
- The Income Basic Tax (20%) targets high-earning residents with significant foreign-sourced income for further tax compliance.
- Income is evaluated annually based on the sum of global and Taiwan-sourced earnings, then taxed accordingly.
- Where data is unavailable (such as precise rates for certain conditions), official figures have not been disclosed by Taiwan’s authorities.
Pro Tips for Navigating Taiwan’s Individual Income Tax
- Maintain accurate records of all Taiwan and foreign-sourced income streams, as both residency and total income affect your final tax liabilities.
- Monitor your days of residency closely if you are a frequent traveler—crossing the 183-day threshold can substantially alter your tax treatment.
- High-net-worth individuals with sizable offshore income should review compliance with the Income Basic Tax each year to avoid unexpected liabilities.
- Double-check current official regulations via Taiwan’s Ministry of Finance main website (https://www.mof.gov.tw) for any updates or clarifications in 2025.
Further Resources
For more comprehensive and current policies, consult the main site of the Taiwan Ministry of Finance.
In summary, Taiwan’s individual income tax system for 2025 is structurally progressive, with brackets ranging between 5% and 40% for residents. Non-resident taxation simplifies compliance but applies higher flat rates, especially for brief stays. Residency and the nature of your income streams can significantly affect the ultimate tax burden. Reviewing your residency status, keeping meticulous records, and monitoring regulatory changes are practical safeguards to navigate the evolving tax environment in Taiwan.