Hire employees in Taiwan
What a foreign company needs to know before employing people in Taiwan: whether you need a Taiwan company, what an employee costs once Labor Insurance, National Health Insurance, the 6% pension and a year-end bonus are added, how the minimum wage and the new 16-day holiday calendar work, why every dismissal needs a listed ground, and how the work permit rules shape foreign hires. Written for CHROs, CFOs, General Counsel and founders.
Quick answers
The questions leadership teams ask first.
Do I need a Taiwan company to hire?
Not for Taiwan nationals or Gold Card holders. There are three routes:
- Employer of Record. Dryft Global employs the person through a compliant Taiwan entity under a dispatch arrangement, enrolls them in Labor Insurance, National Health Insurance and the Labor Pension, withholds tax and manages leave, notice and severance. You direct the work.
- Direct Taiwan company. Needs approval from the MOEA Department of Investment Review, company registration and BLI and NHIA registration before first payroll. It is the usual route for foreign professionals who need a sponsored work permit.
- Independent contractor. Lawful only for a genuinely independent business delivering a result. If the person works like an employee, a Taiwan court will treat them as one.
When should I use an EOR instead of setting up a Taiwan company?
Use an EOR for your first Taiwan national hires and Gold Card holders, and wherever investment approval and insurance registration would hold up the hire. Your own company earns its keep for a large team, for foreign professionals who need a sponsored work permit, or for a business selling to Taiwan customers.
What does an employee actually cost beyond salary?
About 15% to 17% in statutory costs on a typical professional salary: Labor Insurance and Employment Insurance, Occupational Accident Insurance, the employer's NHI share and a 6% pension contribution. Near the TWD 45,800 Labor Insurance cap the figure is about 20%, and above TWD 150,000 a month it falls below 13%. On top of that, a year-end bonus of 1 to 2 months is customary.
How difficult is termination in Taiwan?
There is no at-will dismissal. An employer must rely on a ground listed in Labor Standards Act Article 11, give notice of 10 to 30 days by length of service, and pay severance of 0.5 month per year, capped at 6 months, under the new pension system. Summary dismissal without severance is limited to Article 12 causes and must be used within 30 days of learning the facts. Mutual termination agreements are the common clean exit.
Can Dryft Global legally employ my team in Taiwan?
Yes, for Taiwan nationals and Gold Card holders. Dryft Global employs them as dispatched workers under the Labor Standards Act, holds the Labor Insurance, NHI and pension registrations, withholds tax and manages leave, notice and severance. The client shares liability for unpaid wages and occupational accidents, and we structure the engagement with Article 17-1 in mind. Because Employment Service Act Article 57 restricts hiring a foreigner to work for another party, foreign professionals without a Gold Card are usually hired through your own Taiwan entity.
Hiring routes compared
Speed, foreign hire options and liability differ by route.
| Factor | Direct Taiwan company | Dryft Global EOR | Independent contractor |
|---|---|---|---|
| Time to first payroll | Several weeks after investment approval | Days to 2 weeks | Days |
| Labor Insurance, NHI and pension | Your registrations | Handled by Dryft Global | Contractor arranges own |
| Foreign professionals | Sponsor work permits on your entity | Gold Card holders | Not available |
| Dispatch rules | Not applicable | Joint liability; structured for Article 17-1 | Not applicable |
| Severance liability | Yours | Managed by Dryft Global | High if reclassified |
| Best fit | Large team, sponsored foreign hires | First national hires, engineering and support | Short independent projects |
What an employee costs in Taiwan
Taiwan's statutory burden is moderate and falls as salaries rise, because Labor Insurance stops at TWD 45,800 a month and the pension at TWD 150,000. The customary year-end bonus is the largest discretionary line. The model below is a Taipei software engineer on TWD 100,000 a month in 2026.
| Component | Employer share | Notes |
|---|---|---|
| Labor Insurance and Employment Insurance | 70% of 12.5% | On insured salary up to TWD 45,800; about TWD 4,008 a month |
| Occupational Accident Insurance | ~0.21% | Employer only, industry rate, up to TWD 72,800 |
| National Health Insurance | 5.17% x 60% x 1.56 | Insured amount up to TWD 313,000 |
| Labor Pension | 6% minimum | Wage grade up to TWD 150,000 |
| Arrear Wage Payment Fund | 0.025% | Employer only |
| Statutory subtotal | ~15.1% | On the model salary; ~20% near the Labor Insurance cap |
| Year-end bonus | ~8.3% per month paid | 1 to 2 months, customary not statutory |
| Supplementary NHI | 2.11% | On payroll above insured amounts, including bonuses |
| Total with a 1-month bonus | ~23.6% | Above base salary |
On the model salary, annual employer cost is about TWD 1,381,600 (USD 42,500) before any bonus, and about TWD 1,483,400 (USD 45,700) with a one-month year-end bonus, at TWD 32.478 to the dollar on 30 October 2026, before the EOR fee. Ask us for a cost model for your salary band and bonus policy.
Payroll and tax
Monthly pay in TWD is standard for salaried staff, with an itemized wage statement and wage records kept for 5 years. Employees are enrolled in Labor Insurance, NHI and the Labor Pension on their first day. Salary withholding is deposited by the 10th of the following month, and BLI and NHIA bill premiums monthly. Annual withholding statements and the supplementary NHI report are due by 31 January, and employees file individual returns in May.
Progressive tax with fixed allowances
Residents pay 5% to 40%. For tax year 2026 the bands are 5% to TWD 610,000, 12% to TWD 1,380,000 and 20% to TWD 2,770,000, then 30% and a top band of 40%. Allowances include a TWD 101,000 personal exemption, a TWD 136,000 standard deduction and a TWD 227,000 salary special deduction. Non-residents pay 18%, or 6% where monthly salary is no more than 1.5 times the minimum wage. Qualifying foreign special professionals can exclude 50% of salary above TWD 3 million for 5 years.
Minimum wage
The Minimum Wage Act sets a national rate reviewed each autumn. For 2026 it is TWD 29,500 a month and TWD 196 an hour, and TWD 30,900 and TWD 205 have been announced for 2027. It rarely binds professional hires, but it sets the lowest Labor Insurance and NHI grade. Foreign professionals in specialized work need at least TWD 47,971 a month.
Pension for foreign professionals
From 1 January 2026 foreign professionals in white-collar work are covered by the new Labor Pension system without permanent residence, so the 6% employer contribution applies to them too.
Leave and mandatory benefits
- Annual leave. 3 days after 6 months, 7 after 1 year, 10 after 2, 14 after 3, 15 after 5, then one more day a year up to 30. Unused leave is paid out at year end or on termination unless carried forward by agreement.
- Public holidays. 16 paid national holidays a year since the 2025 holiday law, up from 12, including five Lunar New Year days. Holiday work is paid double.
- Sick leave. Up to 30 days a year at half pay without hospitalization.
- Maternity. 8 weeks, on full pay after 6 months' service, plus 7 days of paid prenatal checkup leave.
- Paternity. 7 days of paid leave for childbirth and prenatal accompaniment.
- Parental leave. Unpaid by the employer until the child is 3, with an Employment Insurance allowance of up to 80% of insured salary for 6 months per parent. From 2026 up to 30 days can be taken in single days.
- Working time. 8 hours a day and 40 a week, two days off in seven. Overtime is paid at 1.34 then 1.67 times and capped at 46 hours a month.
- Year-end bonus. Not statutory, but 1 to 2 months is customary, and a regular bonus counts as wages for severance.
Termination and notice periods
There is no statutory probation, and probation does not change the dismissal rules: every employer termination needs a ground listed in Article 11, with notice and severance, or a misconduct cause in Article 12.
| Length of service | Notice |
|---|---|
| Under 3 months | None |
| 3 months to 1 year | 10 days |
| 1 to 3 years | 20 days |
| Over 3 years | 30 days |
- Severance under the new pension system. 0.5 month of average wage per year of service, capped at 6 months, payable within 30 days. Service retained under the old scheme earns 1 month per year.
- Listed grounds only. Closure, losses, force majeure, a change in the business with no alternative role, or a worker clearly unable to do the job. Courts treat dismissal as a last resort.
- Summary dismissal. No notice or severance for listed misconduct, including 3 consecutive days of unexcused absence, but the employer must act within 30 days.
- Job-search leave. Up to 2 days a week of paid leave during notice.
- Mass redundancy. Above the thresholds, 60 days' written notice to the authorities, unions and employees, and negotiation within 10 days.
Can I use independent contractors?
Only where the person delivers a result as a genuinely independent business: their own clients, their own schedule, their own tools and their own business risk. Taiwan courts weigh personal, economic and organizational subordination, and Constitutional Court Interpretation No. 740 confirmed that the contract label is not decisive. A full-time contractor embedded in your team is an employee whatever the paperwork says. Reclassification brings back Labor Insurance, NHI and 6% pension arrears with surcharges and fines, plus overtime, leave and severance claims. Dispatch arrangements have their own rules: the dispatch contract must be indefinite term, the user entity is jointly liable for unpaid wages and occupational accidents, and a user entity that selects a specific worker before dispatch can face a request for direct employment under Article 17-1. For anyone who works like an employee, a properly structured EOR or your own entity is the compliant route.
The legal framework in brief
Taiwan is a civil law jurisdiction with a national labour code and a national minimum wage. The instruments you will hear most:
- Labor Standards Act. Contracts, hours, overtime, leave, wages, notice, dispatch work and the Article 11 and 12 dismissal grounds. Last amended in July 2024.
- Minimum Wage Act. In force since January 2024, with an annual review committee.
- Labor Pension Act. Minimum 6% employer contribution and the 0.5-month severance formula, extended to foreign professionals from 2026.
- Labor Insurance, Employment Insurance and Occupational Accident Insurance. Administered by the Bureau of Labor Insurance.
- National Health Insurance Act. 5.17% premium plus the 2.11% supplementary premium.
- Employment Service Act and Foreign Professionals Act. Work permits, the TWD 47,971 salary floor, the Employment Gold Card and the Article 57 restriction on deploying foreigners to work for another party.
- Personal Data Protection Act. Amended in 2023 and 2025, with a Personal Data Protection Commission in preparation and cross-border transfers permitted unless restricted.
- Authorities. Ministry of Labor, Bureau of Labor Insurance, National Health Insurance Administration, Ministry of Finance, Workforce Development Agency and National Immigration Agency.
Where the talent is
About 23.2 million people and a labour force of about 12.45 million, with unemployment of 3.36% in September 2026, so experienced engineers are in demand and retention matters. Taiwan hosts the world's largest contract chipmaker and much of the global semiconductor, IC design and server supply chain, which keeps engineering pay above the national median. Mandarin is the working language; English is usable in technology and multinational employers, so test it for client-facing roles. Taiwan runs on UTC+8 with no daylight saving.
| Region | Talent and industry concentration |
|---|---|
| Taipei and New Taipei | Headquarters, finance, software, regional offices and shared services |
| Hsinchu | Semiconductors and IC design around the Hsinchu Science Park |
| Taichung | Precision machinery, fabs and the Central Science Park |
| Tainan | Advanced semiconductor manufacturing and the Southern Science Park |
| Kaohsiung | Heavy industry, the port and new fab investment |
Taiwan Implementation Kit
This page tells you the rules. The kit tells you what to do, in what order, and what goes wrong when you skip a step.
- Step-by-step checklist, from route selection to first payroll
- Bilingual contract checklist with bonus and non-compete terms
- Labor Insurance, NHI, pension and withholding calendar
- 2026 insurance grades and cost caps at a glance
- Notice and severance calculator by length of service
- Foreign hire routes: Gold Card, work permits and Article 57
- Every official Taiwan authority with direct links
This guide is general information, not legal, tax or immigration advice. The minimum wage, insurance grades, holiday rules and data protection commencement dates change, and several were revised in 2025 and 2026. Confirm current figures with a qualified adviser or with Dryft. Last reviewed November 2026.
Ready to hire in Taiwan?
Tell us who you want to hire and where they sit. You will get a cost model and a compliant route within a day, from a person who has done this before.