Taiwan Tax on Foreign Income: When Worldwide Income Is Taxed

The short version

If you are a Taiwan tax resident (183 or more days present in a calendar year), Taiwan taxes you on worldwide income in principle. In practice, however, foreign-source income is handled separately from Taiwan-source salary, through a different layer of the system called the income basic tax (often described as Taiwan’s alternative minimum tax).

The two key thresholds, as published by the National Taxation Bureau (as of August 2026):

• NT$1,000,000 — if your aggregated overseas income in a filing unit reaches this in a year, it must be included in the basic income amount.
• The basic income exemption — the income basic tax return is only filed, and basic tax only becomes payable, when the calculated basic income exceeds the exemption amount.

For most foreign employees earning only a Taiwan salary, foreign income never reaches the inclusion threshold, so no action is triggered. The people affected are residents with meaningful foreign income — overseas salary, foreign dividends, rental income abroad, capital gains in foreign accounts.

Residency comes first

The foreign-income rules apply only to residents. Taiwan decides residency for tax by physical presence:

• 183 days or more in a calendar year → tax resident
• Fewer than 183 days → non-resident, taxed by flat withholding on Taiwan-source income, with foreign income generally outside scope

Because residency resets every calendar year, a late arrival is a non-resident for that first partial year even if you stay for years afterwards. Holding an ARC does not make you a resident for tax — the day count does. Our guide to Taiwan income tax for foreigners covers the residency line and the regular salary tax in detail; this article focuses on the foreign-income layer.

The NT$1,000,000 overseas income threshold

Under the Income Basic Tax Act, a resident’s aggregated overseas income — income derived from sources outside Taiwan that is excluded from the regular consolidated income tax — must be included in the basic income return once it reaches NT$1,000,000 in a year for the filing unit.

Two points worth reading carefully:

1. It is an inclusion threshold, not a tax bill. Reaching NT$1,000,000 means the overseas income is reported in the basic income calculation. Whether any basic tax is payable depends on whether the total basic income exceeds the exemption amount.
2. The filing unit is the couple. The threshold applies to the aggregate of the husband-and-wife filing unit, so each spouse’s foreign income is counted together.

The amount includes overseas income excluded from the regular return and income exempt under the Hong Kong and Macau relations act, plus certain CFC business income.

How basic tax is calculated, and when it bites

The income basic tax is a second layer that ensures high earners pay a minimum rate even if their regular income tax is low. The mechanics, structurally:

• Basic income = regular net income + aggregated overseas income (and certain other items such as specified insurance payments and securities-transaction income)
• Basic tax = (basic income − exemption amount) × 20%
• The taxpayer pays the higher of the regular income tax and the basic tax — if regular tax is already above the basic tax, the basic tax adds nothing

The income basic tax return is only filed when basic income exceeds the exemption amount. Because the exemption is a large figure, residents with salary-only income or modest overseas income never reach it. The people who pay are high-income residents with substantial foreign assets or income — and even then, the regular tax usually already exceeds the basic tax unless significant income was otherwise exempt.

Foreign tax paid abroad can be credited against the basic tax for the same overseas income, avoiding double taxation. The claim is made in the basic income return with evidence of the foreign tax paid.

Practical checklist

For a foreign resident with any foreign income, the practical checklist:

• Total your overseas income across the filing unit. Below NT$1,000,000, it stays out of the basic income return.
• If it reaches the threshold, include it and check whether the total basic income exceeds the exemption amount — if not, no basic tax is due.
• Keep records of foreign tax paid on the same income, for the credit claim.
• Watch the source rules. Income paid from abroad for work performed while physically in Taiwan is generally Taiwan-source income, not foreign income — that distinction is a common source of mistakes.
• Gold Card holders under the foreign special professional regime have separate rules that can exclude overseas income during the qualifying period — verify the current terms if this applies to you.

Tax rules are set annually and individual facts vary widely, so verify the current thresholds and exemption amount with the National Taxation Bureau or a licensed practitioner before relying on any figure in this article.