🇹🇼 Hiring in Taiwan

💡 Everything you need to know to hire and manage employees in Taiwan through Toku. Toku handles payroll processing, tax withholding, social contributions, and statutory compliance. This guide covers what you need to plan costs and manage your team.

At a Glance

Onboarding a New Hire

Plan for 7-10 business days between submitting a new hire and their start date. Your new hire needs to provide their national ID or Alien Resident Certificate (ARC), and Toku enrolls them in National Health Insurance and Labor Insurance before their start date.

Submit your new hire through the Toku platform and we take it from there: local employment agreement, statutory registrations, and payroll setup. See Onboard Contributors as a Client Admin in Toku for the step-by-step process, and the Country Readiness Live Tracker for lead times across all countries.

Employer Costs

On top of gross salary, employers in Taiwan pay:

As a rule of thumb, total cost of employment is roughly 117-119% of gross salary, and because several contributions are capped, the effective percentage drops for higher earners. There is no statutory 13th month salary, though many companies budget a year-end bonus as market practice.

Employees pay their own share too: about 2.3% labor insurance, 0.2% employment insurance, and 1.55% National Health Insurance, plus progressive income tax (5-40% for residents). These are withheld from gross salary, not charged on top. Toku calculates and remits all of the above.

Compensation & Payroll

Toku runs one payroll per month in Taiwan, and employees receive a payslip each cycle. The minimum wage from January 1, 2026 is NT$29,500 per month (NT$196 per hour), reviewed annually by the government. All wages are paid in TWD.

Employment Contracts & Probation

• Toku issues a compliant local employment agreement for every hire.
• Indefinite-term contracts are the default for continuing work. Fixed-term contracts are only permitted for temporary, short-term, seasonal, or project-specific work, and a fixed-term contract covering continuing work is treated as indefinite by law.
• Probation is set in the employment agreement. Taiwanese law does not explicitly regulate probation, and a 3-month period is standard practice.

Working Hours

The standard schedule is 8 hours per day and 40 hours per week, with two days off every seven days: one flexible rest day and one mandatory day off. Overtime requires employee consent and is capped at 46 hours per month (extendable to 54 by labor-management agreement). Weekday overtime is paid at 1.34x for the first 2 hours and 1.67x beyond that, with higher rates for rest-day work; the mandatory day off can only be worked in emergencies, at double pay plus a make-up day off.

Leave Entitlements

Unused annual leave must be paid out in wages at year-end unless you and the employee agree to carry it over to the following year. Parental leave allowances are funded by the government through employment insurance, not by you.

Public Holidays (2026)

Taiwan observes 14 nationwide public holidays in 2026. When a holiday falls on a Saturday, the preceding Friday is typically observed as the day off; holidays falling on rest days can result in a replacement holiday on the next working day.

Benefits: Required vs. Common Extras

Statutory (included in employer costs above): labor insurance (covering injury, disability, maternity, death, and old-age benefits), National Health Insurance (Taiwan's comprehensive single-payer healthcare), a 6% employer-funded labor pension paid into each employee's individual account, and employment insurance covering unemployment benefits and parental leave allowances.

Through Toku you can add supplemental health coverage via Remote Health, a private group health insurance plan that tops up the public system for your team.

Other common extras include group life and medical insurance, annual health checkups, meal and transportation allowances, performance bonuses, and equity plans, which are especially common in the technology sector. Toku can advise on the cost impact of any of these.

Ending Employment

Employers in Taiwan may only terminate for reasons specified in the Labor Standards Act (such as business contraction, role redundancy, or inability to perform duties), and pregnant employees, employees on parental leave, and employees recovering from occupational injuries are protected, so involve Toku early if you are considering ending an employment relationship. For the process, see How to Terminate an Employee or Contractor.

During the notice period employees may take up to 2 paid days per week for job hunting. Statutory severance under the current pension system is half a month's average salary per year of service, capped at 6 months' salary, and must be paid within 30 days of termination. Termination for serious misconduct requires neither notice nor severance.

Hiring Someone from Overseas?

Foreign professionals need a work permit from the Ministry of Labor before starting work in Taiwan. The main routes are the standard employer-sponsored work permit (processing typically 2-4 weeks) and the Employment Gold Card, an open work permit for professionals earning at least NT$160,000 per month or with outstanding achievements in designated fields. Talk to Toku before extending an offer to a candidate who needs sponsorship.

---

Last verified July 2026. This guide is for general information and doesn't constitute legal or tax advice. Your Toku account manager can confirm specifics for your situation.