Taiwan Personal Income Tax Guide (IIT)

IIT Tax Brackets 2026 (Simplified)

Taiwan uses a progressive six-bracket system on net taxable income (total income minus deductions and allowances):

• 5% — on the first TWD 590,000 of net taxable income
• 12% — on TWD 590,001 to TWD 1,330,000
• 20% — on TWD 1,330,001 to TWD 2,660,000
• 30% — on TWD 2,660,001 to TWD 4,980,000
• 40% — on TWD 4,980,001 and above

Note: The sixth bracket (40%) was simplified from the former 5/12/20/30/40% five-bracket structure; as of 2026, the top bracket applies above approximately TWD 4.98 million. Brackets are adjusted periodically for inflation.

Standard Deduction

• Standard deduction (標準扣除額): TWD 124,000 per taxpayer for 2026 (TWD 248,000 for a married couple filing jointly). Taxpayers may choose between the standard deduction and itemising actual expenses.
• Itemised deductions: Medical expenses, donations (up to 20% of gross income), insurance premiums (up to TWD 24,000 per person), housing mortgage interest (up to TWD 300,000), and rental expenses (up to TWD 120,000). You cannot claim both mortgage interest and rental expenses.

Special Salary Deduction

• Salary deduction (薪資特別扣除額): TWD 207,000 per taxpayer for 2026. This is available to all employed individuals and is automatically applied. If actual work-related expenses exceed this amount, taxpayers may itemise under certain conditions.
• The deduction applies to wage and salary income only — not to business, professional, or rental income.

Dependent Allowances

• Personal allowance (免稅額): TWD 92,000 per taxpayer, spouse, and each dependent (2026). For taxpayers aged 70+, the allowance increases to approximately TWD 138,000.
• Eligible dependents: Children under 20 (or under 26 if in full-time education), parents/grandparents aged 60+, and other relatives who meet support criteria. Each dependent reduces taxable income by the allowance amount.
• Claiming dependents requires them not to have filed a separate tax return or to have income below the basic living allowance threshold.

Filing Requirements

• Filing period: 1 May to 31 May each year (sometimes extended to 1 June if 31 May falls on a weekend).
• Residents: File on worldwide income. Taxable globally but foreign tax credits are available for taxes paid abroad (limited to the Taiwan tax due on that income).
• Non-residents: Withholding at source — typically 18% on employment income for stays of 90 days or fewer, or 21% for those staying longer but not meeting the 183-day residency test.
• Filing methods: Online via the Ministry of Finance e-tax portal (最方便), mobile app, or paper filing. Pre-filled returns are available.

Basic Living Allowance (基本生活費)

• If the basic living allowance (for the taxpayer, spouse, and dependents) exceeds the sum of standard/itemised deductions + special salary deductions, the difference can be deducted from taxable income. This ensures subsistence-level income is not taxed.
• For 2026, the basic living allowance per person is approximately TWD 202,000 (adjusted annually for CPI).