Bonuses under NT$69,500 to be income tax exempt
The China Post news staff
January 18, 2014, 12:00 am TWN
TAIPEI, Taiwan -- The National Taxation Bureau of the Southern Area said yesterday that year-end bonuses under NT$69,500 will not be taxed.
The bureau explained that if a tax withholder, such as a company, pays out a year-end bonus below NT$69,500 to an employee who has resided in Taiwan for at least 183 days during the tax year, that bonus will not be subject to an income tax; however, the bonus must be declared to the relevant authorities.
For example, if a company gives one employee a year-end bonus of NT$50,000 and another NT$70,000 this year, the former bonus will not be taxed, while the latter will be subject to a 5-percent income tax of NT$3,500, which has to be declared in 2015.
The bureau reminded tax withholders that according to Article 14 of the Income Tax Act, a worker's income includes salaries, stipends, wages, allowances, annuities, cash awards, bonuses and all kinds of subsidies; therefore, year-end bonuses must be processed.