General Taxes in Taiwan
Find out about the different taxes that a person may be liable for when living in Taiwan...
General taxes, those levied on properties, vehicles and stamp duty are local, rather than national taxes. They are billed and collected by the National Tax Administration of the county or city a taxpayer lives in. For example, residents of Taipei City have their taxes collected by the Taipei National Tax Administration.
There are a variety of ways to pay:
- In person at a bank
- By telephone
- At automated teller machines (ATMs)
- In cash at some convenience stores, such as OK, Family Mart, 7-11 and Hi- Life
- By credit card
Direct tax payments can be arranged with a bank so that tax bills are automatically paid on time. Late payment of taxes results in fines, which increase over time.
Stamp duty is levied when certain documents are drawn up and signed in the country; it is not charged on transactions. The tax is generally charged at a rate of 0.1 to 0.4 percent, and there is a fixed rate for the sale or purchase of moveable properties.
The following documents are subject to stamp tax:
- Deeds or contracts for the sale or purchase of moveable properties
- Receipts for monetary payments
- Contractual agreements for specific tasks, for example, construction or printing contracts
- Contracts for the sale, partition or transfer of real estate
All documents drawn up by government agencies and monetary receipts from both private and public schools are exempt from stamp duty.
- For a full list of exemptions from stamp duty: Click here
Land Value Tax
Land tax is due every year in November and all landowners in Taiwan must pay land value tax. It is levied on the total land area owned by an individual, which has been assigned a land value by the municipality. All assigned land has a posted value, which is publicly announced by the Land Value Assessment Commission. Landowners are obliged to declare the value of their land; the declared value should be within 80 to 120 percent of the posted value. If the value is not declared then it will be valued at 80 percent of the posted value. Land of up to 300m2 in urban areas and 700m2 in rural areas which is used for residential purposes, is taxed at a flat rate of 0.2 percent.
- For more information on land value tax: Click here
Land Value Increment Tax
When land is sold in Taiwan it is not subject to income tax. However, land value increment tax must be paid. The amount owed is calculated based on the incremental increase in the value of the land since its last transfer. The rate of tax varies from 20 to 40 percent. Land which is inherited is not subject to land value increment tax.
- For more information on land value increment tax: Click here
House tax, which is due in May each year, is levied on all buildings in Taiwan, and there is a fine if it is not paid on time The rate depends on the building's classification, which is determined by the local tax office of the province or city government. Residential properties are taxed at a rate of between 1.2 and 2 percent of the assessed value.
- For more information on house tax: Click here
Vehicle Licence Tax
Vehicle licence tax is due annually in April. All users of vehicles which use either Taiwan's roads or rivers must pay vehicle licence tax. For private cars seating up to nine people and motorcycles the tax due depends on the vehicle's cylinder volume, or power. Electrical vehicles are currently exempt from the tax.
Value Added Tax
Value Added Tax (VAT) is levied at a rate of five percent on all goods and services in Taiwan. It is charged on the value added to goods and services in all stages of the production and distribution chains.