ir total annual income when they file their income tax statements in May. Under the old rules, NHI premiums paid by a wage earner and his or her family were included in the category of life insurance premiums, tax consultants at a major insurance company said. Each person was allowed a total deduction amount of NT$24,000 per person in that category, they said.
But the regulations were revised by lawmakers last year to separate the NHI premiums from the category to allow taxpayers to claim this portion of premiums as expenses, the tax consultants said.
This will be a boon in terms of extra savings in income tax for those who purchased life insurance as well as health insurance for themselves and their families.
To get the additional tax deduction, taxpayers may submit the original receipts or certificates of premiums already paid in the NHI program run by the government.
The deduction can include the NHI premiums paid for the taxpayer's spouse, children, and parents, according to the tax consultants.
People who didn't purchase policies from life insurance firms may still enjoy the deduction of NHI premiums with a ceiling of NT$24,000 each person in the same household or choose the standard annual tax deduction, although their tax breaks will not be as big as life insurance policyholders.
Consultants said a recent survey shows that as many as 61.4 percent of people in Taiwan do not know that they are allowed to deduct as much as NT$24,000 in life insurance premiums per person each year.
Taxpayers should not ignore the further deduction of the NHI premiums effective next month, they said.
All taxpayers, including citizens of the country and foreigners working in Taiwan, are required to complete filing income tax returns May 1-31.
Concerning the death payment for life insurance policyholders, consultants said, each adult beneficiary is entitled to income tax exemption on the portion under NT$30 million.
Only the portion exceeding the NT$30 million exemption limit will be subject to income tax, the consultants explained.
But a beneficiary who is a minor will have to lump his portion of the insurance payment into the amount received by the surviving parent for total calculation.
