Hiring at a Glance

Taiwan is a highly advanced economy, especially in electronics, semiconductors, and information technology. It uses the New Taiwan Dollar (TWD) and has a multilingual, well-educated workforce. Employment is regulated by the Labor Standards Act, which requires written contracts and sets a maximum 40‑hour workweek. All employers must comply with labor insurance, health insurance, pension, and tax laws. For example, employers pay about 33% of gross salary in mandatory contributions (including labor and health insurance premiums and a 6% pension contribution). Employees pay roughly 27% of their salary in contributions as well. Income tax is progressive (5%–40% for residents). Navigating these obligations can be complex, so foreign companies often use an Employer of Record. An EOR in Taiwan becomes the legal employer, handling all registrations, payroll taxes, and compliance (allowing the foreign company to hire local staff without setting up a local corporation).

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Key characteristics of talent market

Taiwan’s labor market is characterized by high technical skill levels and industry expertise. The workforce includes many engineers, scientists, and IT professionals due to Taiwan’s global leadership in semiconductor fabrication and electronics manufacturing. English fluency is moderate, but many professionals in tech and business sectors speak English. Labor costs are higher than in mainland China but lower than in the US or Western Europe. Importantly, Taiwan’s business environment has familiar regulations (e.g., similar overtime limits) and modern infrastructure (e.g., English online government portals). Employers can tap into a disciplined, technically proficient workforce, especially for engineering, high-tech manufacturing, and IT roles. Employment law mandates (e.g. strict overtime pay rates) ensure worker protections that companies must observe.

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Most In-Demand Skills in 2026

Taiwan’s demand is greatest in technology, engineering, and manufacturing skills. Key roles include semiconductor/electronics engineers, software developers, data scientists, and IT infrastructure specialists. The island is a global hub for high-tech hardware, so roles in embedded systems, electrical engineering, and precision manufacturing are highly sought. Additionally, Taiwan’s healthcare and biotechnology industries are growing, so life science and medical engineering expertise is in demand. In the services sector, skills in finance, accounting, and advanced manufacturing operations are also needed, reflecting expansion of corporate R&D centers and back-office functions. In summary, top in-demand skills are semiconductor/electronics engineering, software and data analytics, automation/industrial engineering, and specialized finance/operations roles.

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Top Universities Supplying Talent

Taiwan has several top-tier universities that produce much of the local talent. National Taiwan University (Taipei) is the most prestigious and often ranks highly globally; it has strong programs in engineering, computer science, and business. Other top institutions include National Tsing Hua University (Hsinchu, engineering and science), National Chiao Tung University (Hsinchu, engineering), and National Cheng Kung University (Tainan, engineering). These schools regularly appear in international rankings and graduate large numbers of engineers and scientists. Graduates from these universities are heavily recruited in Taiwan’s tech sectors, especially around Hsinchu Science Park and Taipei’s tech industry.

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Salary Benchmarks for Roles

Salaries in Taiwan are competitive for Asia but below Silicon Valley levels. For example, Levels.fyi reports the median total compensation for a software engineer in Taiwan is about NT$1.50M per year (roughly US$50k or €45k), with the middle 50% range spanning ~NT$1.07M–2.04M (≈US$35k–66k). Data analysts and QA engineers typically earn in the same ballpark (mid 30s to mid 60s in thousands USD). Senior product managers and finance managers in international companies often see higher pay: experienced professionals frequently earn US$60k–80k (around €55k–75k) annually. Roles in multinational firms or in Taipei/Hsinchu tech hubs can reach upper ranges. In sum, expect mid-level technical roles in the ~$40k–60k range and senior/management roles in the $60k–80k range. Note that compensation is usually paid in TWD and sometimes supplemented with bonuses.

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Employer of Record vs Legal Entity Setup in Taiwan

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To legally hire employees, a company must

In Taiwan, companies must complete several registrations before hiring. First, the business entity must register with the Ministry of Economic Affairs to obtain a company registration certificate (and a tax ID from the National Taxation Bureau). The employer must also register with the Bureau of Labor Insurance for Labor Insurance (including employment insurance) and pension contributions, and with the National Health Insurance Administration for health insurance. These registrations require corporate documents, director IDs, and address proof, and must be done before hiring. Each new employee must then be reported to the Bureau of Labor Insurance within 5 days of starting and enrolled in national health insurance. Employment contracts must comply with the Labor Standards Act (specifying wages, hours, benefits, etc.). On an ongoing basis, the employer withholds income tax and the employee’s share of contributions from each paycheck, and remits these amounts (along with the employer’s share) to the respective funds (tax bureau, Labor Insurance, NHI) by the required deadlines. Compliance with these registrations and filings is mandatory for legal employment in Taiwan.

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Cost of Entity Setup

Forming a Taiwanese company (“股份有限公司” or “有限公司”) is fairly efficient and has no statutory minimum capital. In practice, founders typically declare sufficient capital (often in the range of NT$1M–3M) to cover initial expenses. Registration with MOEA can be done quickly (often in a few days to a couple of weeks) if all documents are in order. Fees are modest: government filing fees are a few thousand TWD plus notary/agency costs. Even though capital can be minimal, initial funding must be verified by an accountant. After setup, ongoing costs include accounting/bookkeeping (in Chinese), tax filings, and full payroll management (see contributions above). While corporate tax is low (20% statutory rate), maintaining an entity involves compliance costs. Many foreign companies therefore avoid forming a Taiwanese entity at all, using an EOR to handle hiring and payroll instead.

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What Hiring Through an EOR Means in Taiwan

An Employer of Record (EOR) in Taiwan becomes the legal employer registered with the Ministry of Labor, National Health Insurance Administration (NHIA), Bureau of Labor Insurance (BLI), and the National Taxation Bureau, while the employee works exclusively for your company. You manage day-to-day work and performance; the EOR carries all statutory employer responsibility.

Taiwan’s employment system is governed by:

• Labor Standards Act (LSA)
  
• Labor Insurance Act
  
• National Health Insurance Act
  
• Labor Pension Act (New Pension Scheme)
  
• Income Tax Act
  
• Labour inspection and court framework
  

Foreign companies cannot legally employ staff in Taiwan without:

• A Taiwanese employing entity
  
• Registration with labor, insurance, and tax authorities
  
• Payroll and statutory compliance
  

An EOR provides this entire employer infrastructure without requiring you to establish a Taiwan company or branch.

An EOR in Taiwan handles:

• Taiwan-law compliant employment contracts
  
• Payroll processing in TWD
  
• Income tax withholding and filing
  
• Labor Insurance contributions
  
• National Health Insurance (NHI) contributions
  
• Labor Pension (6% employer contribution)
  
• Statutory leave and public holidays
  
• Termination and labour-dispute handling
  
• Immigration and work permits
  

This model is ideal for companies that want to hire in Taiwan without managing labor insurance, NHI, pensions, and labour-court exposure directly.

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Risk Involved in Both Models

Taiwan’s labour law is employee-protective and inspection-driven.

Key characteristics:

• Written contracts required
  
• Mandatory labor insurance and NHI
  
• Strict working-hour and overtime rules
  
• Termination must meet statutory grounds
  
• Active labour inspections
  

Compliance failures can result in:

• Back payment of wages and overtime
  
• Insurance and pension penalties
  
• Inspection fines
  
• Labour-court compensation orders
  

In Taiwan, overtime miscalculation and improper termination are the biggest employer risks.

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EOR Vs. Entity: When to use What?

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Why is an EOR the Most Efficient Way to Hire in Taiwan?

Taiwan offers strong talent in semiconductors, hardware, software, R&D, and manufacturing but employment is governed by mandatory insurance systems, overtime law, and strict termination rules.

An EOR is not just payroll. It is the legal employer recognised by Taiwanese authorities, responsible for:

• Labor Standards Act compliance
  
• Insurance and pension filings
  
• Payroll execution
  
• Termination handling
  

This allows foreign companies to operate in Taiwan without inheriting labour-inspection and court exposure.

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#1. EOR Manages Labor Insurance, NHI, and Pension Risk

Employment cost in Taiwan includes:

• Labor Insurance
  
• National Health Insurance
  
• Labor Pension (6% employer contribution)

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#2. EOR Controls Working Hours and Overtime Compliance

Taiwan enforces:

• Standard working hours
  
• Daily and weekly overtime limits
  
• Overtime premium rates

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#3. EOR Controls Termination and Labour-Court Risk

Termination in Taiwan requires:

• Statutory grounds
  
• Advance notice or pay in lieu
  
• Severance (if applicable)

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#4. EOR Avoids Entity & Admin Burden

Entity setup requires:

• Company or branch registration
  
• Labor, insurance, and tax setup
  
• Payroll systems

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EOR vs. PEO in Taiwan: How to Decide the Right Hiring Model?

A PEO in Taiwan cannot legally employ workers. A Taiwanese employing entity is required.

• PEO: HR/payroll support only
  
• EOR: Legal employer

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If you don’t want to manage Taiwan’s labor insurance, NHI, and court exposure yourself, EOR is the right model.

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Payroll, Taxes, and Monthly Compliance

Monthly payroll in Taiwan involves calculating gross-to-net pay and remitting withholdings each period. Employers must withhold individual income tax on a progressive scale (5%–40% for tax residents) (plus a flat 18% for non-residents). Statutory contributions include: labor insurance (combining general and employment insurance), national health insurance, and the labor pension. On average, employer contributions total about 32.85% of gross wages (e.g. 12.5% labor insurance + 8.05% employment insurance + 5.17% health + 6% pension + 2.11% supplemental health). Employees contribute roughly 26.8% (e.g. 12.5% labor + 2.5% employment + 5.17% health + 6% pension). Employers must pay these contributions monthly (through the Bureau of Labor Insurance and NHI) and file income tax withholding to the tax bureau. Net salary payments to employees must be made by the payroll date (often by the 5th or 10th of the following month). Each pay period, the employer provides a payslip and remits the withheld taxes and contributions. Annual reconciliation (tax filing by May 31 for the prior year) is also required for employees. Noncompliance (late payments or under-reporting) can incur fines by Taiwanese authorities, so timely monthly processing and accurate records are essential.

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Salary Structure: Where Most Compliance Issues Begin

Compliance issues in Taiwan often arise around insurance and overtime. For instance, the labor insurance premium is based on each employee’s insured salary up to a cap, and employers must pay 70% of that premium (12.5%). If an employer understates an employee’s insured salary (by excluding part of the wage base), they will underpay contributions and risk fines. Similarly, the Labor Pension Act requires 6% contributions on wages (capped); failing to make these timely is a violation. Overtime work (capped by law at 48 hours/month) must be compensated at premium rates (typically 150% of base pay on overtime hours). If overtime or holiday pay is not correctly calculated, this can lead to disputes. Another common issue is mis-classifying salary components: for example, treating a regular bonus as a non-mandatory “13th month” can backfire, since under Taiwan law any promised bonus may become mandatory. In short, employers must be meticulous about including all earned wages in the insurance base and properly compensating overtime and benefits, or else face penalties under the Labor Standards Act and insurance regulations.

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What Monthly Payroll Operations Actually Involve

Monthly payroll in Taiwan is comprehensive. Employers begin by reviewing hours, bonuses, and any changes for the pay period. They calculate each employee’s total gross earnings (base salary plus allowances, bonuses, overtime). From this, they withhold income tax (using the progressive rate schedule) and calculate employee insurance contributions. Employer contributions (health, pension, labor insurance) are also calculated based on gross wages. Employers then pay net salaries (typically via bank transfer) and provide payslips (detailing gross, each deduction, and net pay). Next, the employer remits the collected taxes and contributions: income tax to the tax bureau, and insurance premiums to the Bureau of Labor Insurance and the National Health Insurance Administration. These payments and corresponding declarations are made monthly. According to Taiwanese practice, the total employer cost is about 32.85% of wages in contributions and employee cost about 26.78%, so payroll staff must ensure all amounts match these rates. Finally, employers update their accounting, comply with reporting deadlines, and prepare for the next cycle. These steps repeat each month, ensuring employees are paid on time and all statutory obligations are met.

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Step-by-Step Onboarding Process With an EOR in Taiwan

Hiring in Taiwan is a registry-driven, insurance-heavy process. A compliant onboarding flow protects you from Ministry of Labor penalties and labour-court disputes.

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1. Confirm EOR Registration

Verify the EOR is registered with:

• Ministry of Labor
  
• Bureau of Labor Insurance
  
• National Health Insurance Administration
  
• National Taxation Bureau
  

Unregistered employers cannot legally pay salaries.

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2. Identify Role Coverage Under LSA

EOR determines:

• Whether the role falls under LSA
  
• Applicable working-hour and overtime rules
  

Wrong classification leads to claims.

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3. Validate Contract Type and Working Time

EOR assesses:

• Indefinite vs fixed-term legality
  
• Working hours and shift rules
  
• Overtime eligibility
  
  

4. Structure Salary and Statutory Contributions

EOR validates:

• Gross salary in TWD
  
• Insurance contribution base
  
• Pension contribution
  
• Allowances and bonuses
  
  

5. Provide Full Cost-to-Company Breakdown

Includes:

• Gross salary
  
• Employer labor insurance
  
• Employer NHI
  
• Labor pension
  
• EOR fee
  
  

6. Draft Taiwan-Compliant Contract

Contract includes:

• Duties and title
  
• Salary and pay cycle
  
• Working hours
  
• Leave and holidays
  
• Termination and notice
  
  

7. Register Employee

EOR registers with:

• Labor Insurance
  
• National Health Insurance
  
• Tax authority
  

Late registration is illegal.

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8. Set Up Workplace Policies

EOR issues:

• Working hours and overtime
  
• Leave and attendance
  
• Health and safety
  
• Disciplinary procedures
  
  

9. Immigration Workflow (If Needed)

EOR manages:

• Work permit
  
• ARC (residence card)
  
• Start-date coordination
  
  

10. First Payroll and Filings

EOR processes:

• Salary
  
• Tax withholding
  
• Insurance and pension contributions
  
• Payslip issuance
  
  

11. Ongoing Compliance and Termination

EOR manages:

• Salary changes
  
• Inspections
  
• Contract updates
  
• Termination process
  
• Labour-court representation
  

Most Taiwan employer losses occur after termination.

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Build Your Taiwan Team with Bolto EOR

Expanding into Taiwan is not just about hiring, it is about handling labor insurance, overtime law, and termination rules correctly.

Bolto’s Employer of Record model absorbs:

• LSA complexity
  
• Insurance and pension exposure
  
• Payroll risk
  
• Termination and court exposure
  

So you can scale in Taiwan without becoming a legal employer.

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Full Legal Employer Coverage in Taiwan

Bolto becomes the legal employer before:

• Ministry of Labor
  
• Bureau of Labor Insurance
  
• National Health Insurance Administration
  
• Tax authorities
  
• Labour courts
  

Bolto manages:

• Contracts and compliance
  
• Payroll and statutory filings
  
• Leave and benefits
  
• Audit and inspection response
  
• Termination execution
  

You manage work. Bolto manages legal risk.

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Built for Fast Entry and Clean Exit

With Bolto EOR:

• Hire in weeks
  
• Avoid Taiwan company formation
  
• Skip insurance and pension registration
  
• Exit without liquidation
  
  

Transparent Cost Structure

Bolto provides:

• Salary and statutory breakdown
  
• Insurance and pension visibility
  
• Fixed EOR fees
  
  

End-to-End Employee Lifecycle Management

Bolto manages:

• Contract drafting
  
• Payroll and tax
  
• Insurance and pension
  
• Leave and benefits
  
• Discipline and termination
  
• Labour-court defense
  

You never deal directly with Taiwanese labour authorities.

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Designed for Risk-Controlled Growth in Taiwan

Taiwan penalizes:

• Missing insurance
  
• Overtime violations
  
• Invalid termination
  

Bolto enables growth without inheriting inspection and court risk.