Summary

Taiwan has a limited social insurance scheme which is focussed in Pensions, Health and Industrial injury. Non Taiwanese are excluded from the pension system and the unemployment insurance scheme.

Details

Contributions

There are compulsory social security programs that require contributions from employers and employees based on monthly insured salary, which is capped at various amounts. Taiwan social security programs include the Labour Insurance Program (LIP), National Health Insurance Program (NHIP), and Labour Pension Program (LPP). However, foreign individuals are not eligible for participating in the LPP. In addition, only Taiwanese are eligible for Employment insurance.

Contributions to the difference schemes are capped at different income levels, but the maximum employer contribution to the NHI is $4,200 per year and to the LIP $1,500 per year. Maximum employee contributions are $1,320 and $415 respectively.

Treaties

Taiwan has no reciprocal social security agreements with other counties. Most inbound expatriates are therefore liable to LIP and NHIP contributions, and potentially home country contributions too.

Exemptions

Income paid to a non-Taiwanese national and borne by an offshore company is, if the stay in Taiwan is for less than 90 days in a tax year, not subject to Taiwanese contributions. Short term assignees and business visitors are therefore generally exempt from contributions.

Because of the comparatively low cost of Taiwanese social security, there is no strong trend of assignment planning to reduce contributions.

Administration

Contributions to all the elements of social security are dealt with through payroll and all payments are made to the Bureau of Labor Insurance within the Ministry of Labor.

Benefits

Individuals who sustain an illness or injury while working are covered by Labour Insurance. During the first two years of medical treatment the cover provides first 70 percent, then 50 percent of a worker's employees insured wage, which is not the same as their full wage. . The NHI scheme pays a significant portion of the costs of medical care and medicines; it does not provide total cover for medical expenses.

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