If you’re expanding your business into Taiwan for the first time, there are important legal requirements to be aware of. These norms and laws influence hiring practices in Taiwan and many aspects of the employer-employee relationship, including compensation and benefits.
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Here are six things to know about hiring in Taiwan.
1. Languages in Taiwan
Taiwanese Mandarin is the main language used in government, business, and education. Mandarin, Taiwanese Hokkien, Hakka, and the indigenous languages are all considered national languages under the Development of National Languages Act.
Taiwan’s bilingual 2030 policy wants to increase the talent pool’s global competitiveness by improving English proficiency. Taiwanese Hokkien is the most widely spoken language after Mandarin and is often used in daily life. Hakka is spoken by the Hakka ethnic group.
3. Working hours and time off in Taiwan
Standard working hours are 40 hours per week, with a maximum of eight hours per day. Employees get two rest days per week: one mandatory regular day off and one flexible rest day. The flexible rest day can be worked with employee consent and overtime pay. Employees can’t work more than six days without a rest day. Total working hours, including overtime, can’t exceed 12 hours in a single day. Overtime is capped at 46 hours per month. A labor-management agreement can increase overtime to 54 hours per month.
Employees get a 30-minute break after every four hours of work. For shift workers, there has to be at least 11 hours of rest between shifts. This can be reduced to eight hours with union or labor-management approval.
Paid annual leave is based on tenure:
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Six months to one year: three days
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One to two years: seven days
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Two to three years: 10 days
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Three to five years: 14 days
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Five to 10 years: 15 days
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More than 10 years: one extra day per year, capped at 30 days after 25 years of service
Mothers get eight weeks (56 days) of paid maternity leave. If employed for more than six months, they get full pay; if less, they get half pay. Fathers get seven days of paid paternity leave. Employers can apply for a government subsidy for the sixth and seventh days.
Sick leave (non-hospitalized) is up to 30 days per year. This is paid at 50% of the wage. Hospitalized sick leave can be up to one year within a two-year period. The first 30 days are paid at 50%. The remainder is unpaid unless covered by labor insurance. The combined total of ordinary and hospitalized sick leave can’t exceed one year in any two-year period.
Taiwan has 12 national holidays. If a national holiday falls on a rest day, a substitute day off or compensation has to be provided.
Employers have to keep detailed attendance records (including arrival and departure times to the minute) for at least five years.
4. Employment contracts in Taiwan
The Labor Standards Act (LSA) regulates employment relationships in Taiwan. If a Taiwan employee is assigned abroad but the employment relationship is maintained with a Taiwan-based employer, the LSA can still apply.
There are two main types of employment contracts:
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Indefinite-term: This is the default and required for any continuous work, including all part-time and full-time permanent roles.
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Fixed-term: This is only for noncontinuous work, such as temporary, short-term, seasonal, or project work. Using fixed-term contracts for ongoing roles isn’t allowed.
The LSA doesn’t need all employment contracts to be in writing but it’s strongly recommended and is best practice. For global employees, written contracts are mandatory. All contracts have to comply with the minimum standards of the LSA. A comprehensive written contract includes:
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Employee’s role and job description
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Expected duties
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Pay expectations and calculation method
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Start date (and end date for fixed-term contracts)
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Vacation and leave entitlements
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Rules of conduct and disciplinary measures
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Termination conditions and severance
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Any other critical information relevant to the employment relationship
5. Compensation and benefits in Taiwan
Under the Labor Standards Act, wages have to be paid at least twice per month unless both parties agree in writing to a monthly or other schedule. As of 2025, the minimum wage in Taiwan is NTD 28,590 per month and NTD 190 per hour.
The cost of NHI is split between the employer (60%), the employee (30%), and the government (10%). The premium rate is 5.17%. Employers have to enroll employees in the NHI on their first day of work.
Labor insurance is mandatory for all employees. Employers pay 70% of the premium, the employee 20%, and the government 10%. Labor insurance covers occupational accidents, disability, death, and maternity benefits.
Employment insurance is mandatory for most employees aged 15–65, with some exceptions. The premium is 1% and split as follows: employer 70%, employee 20%, and government 10%. It provides unemployment, parental leave, and job training benefits.
Employers have to contribute at least 6% of each employee’s monthly wage into an individual pension account under the Labor Pension Act. Employees can make voluntary contributions of up to 6% of their wage.
6. Taxes in Taiwan
Anyone who stays in Taiwan for 183+ days in a calendar year is considered a tax resident. Residents are taxed on their worldwide income. Nonresidents are taxed only on Taiwan-sourced income.
Taiwan uses a progressive income tax system, with rates from 5–40%. For 2025, the brackets are:
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5%: up to NTD 590,000
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12%: NTD 590,001–1,330,000
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20%: NTD 1,330,001–2,660,000
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30%: NTD 2,660,001–4,980,000
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40%: over NTD 4,980,000
The income basic tax (IBT) is an alternative minimum tax and applies only if certain thresholds are met (for example, if a taxpayer has large income from sources such as stock gains, insurance payouts, or international income that is otherwise tax-exempt or taxed at a lower rate). Most ordinary salary earners don’t pay IBT. If the IBT calculation exceeds the regular income tax, the taxpayer pays the higher amount. The IBT rate is 20%.
Employers withhold income tax from employee salaries and remit it to the tax authorities monthly. They have to provide annual withholding statements to both employees and the tax office.