Employer of Record in Taiwan: A Complete Guide for 2026

Introduction

Taiwan is one of Asia's most appealing places to build a team. It has a deep pool of engineering and tech talent, a stable economy, and close ties to global supply chains.

However, hiring in Taiwan isn't as simple as sending an offer letter. Employment is governed by the Labor Standards Act, and payroll runs through several layers of insurance and pension contributions.

Moreover, setting up a local entity can take weeks and a sizable amount of registered capital.

That's where an employer of record (EOR) in Taiwan comes in. An EOR acts as the legal employer for your staff, so you can hire, onboard, and pay people in Taiwan without opening your own entity.

It handles contracts, payroll, labor, and health insurance, and day-to-day compliance, while your team manages the actual work.

This guide covers what you need to know to hire in Taiwan with an EOR.

Taiwan at a glance

Estimated Population: 23 Million

Currency: New Taiwan Dollar (TWD)

Capital: Taipei

Languages: Taiwanese, Mandarin, and Hakka

GDP Per Capita: NT$ 13,231,92

Employment in Taiwan

Taiwan employment laws cover most employees and apply to all industries and occupations, with a few exceptions. Employment in Taiwan is primarily covered by the Labor Standards Act (LSA).

Workers employed by the state, including civil servants, are not covered under this act. The LSA applies differently to people with fixed-term employment contracts in Taiwan and those with indefinite-term contracts.

Foreign nationals working in Taiwan are subject to the LSA as well. The choice of law in the employment contract makes no difference. Additionally, foreign nationals need a work permit to work in Taiwan.

A person whose employment agreement in Taiwan is governed by the LSA will be governed by it even if he moves out of Taiwan. For the LSA not to apply to them, they will have to terminate their employment contracts in Taiwan.

For a business looking to expand its operations internationally and employ workers in Taiwan, it is prudent to be aware of Taiwan’s relevant employment contract law and its coverage. Partnering with a local EOR like Skuad’s Taiwan EOR solution can help make these processes more manageable.

Here are some Taiwan labor laws to be aware of when hiring in Taiwan:

Taiwan's Labor Standards Act sets specific rules around contract type, overtime tiers, leave accrual, and termination notice. Misreading any of these obligations creates downstream payroll and compliance work that's expensive to undo.

Skuad helps you stay aligned with local employment rules from the start of the relationship. Here is what Skuad helps with:

Here is what Skuad helps with:

• Employment contract generation across 160+ countries, aligned with local labor laws and statutory requirements
• Statutory contribution workflows across supported markets, covering applicable social insurance and pension obligations
• Leave tracking and accrual support in line with local entitlement rules
• Termination and offboarding support aligned with notice and severance requirements across supported markets

Book a demo to see how Skuad supports Taiwan employment compliance end-to-end

Contractors vs full-time employees

The Labor Standards Act differentiates between workers who have fixed-term contracts and indefinite-term contracts. A fixed-term employee will become an indefinite-term employee if:

• The previous contract and the new contract cover more than 90 days, and the gap between the expiration of the previous contract and the execution of the new one is less than 30 days.
• The employer does not object to the employee continuing to work even after the expiration date has passed on their fixed-term contract.

The LSA provides the same kind of benefits and rights to both kinds of workers.

However, there are a few differences. Employers do not need to send an advance notice or pay severance to fixed-term employees.

An employee who is aggrieved by being classified as a fixed-term worker or an independent one can file a claim against the employer.

Agency workers

There was a legal loophole in Taiwan’s LSA, which enabled employers to classify employees as workers of agencies rather than their employees. Standard employees were forced to sign contracts with agencies to facilitate the scam.

This was done to avoid the responsibilities and benefits that employers had to oblige under the LSA.

Taiwan has tried to plug this loophole by allowing employees who have been victims of this to file a claim with the authorities within 90 days of starting service as an employee.

Temporary workers

Workers who do not serve for more than six months may be considered temporary workers. They are entitled to the same benefits and rights as indefinite-term employees.

Scope of negotiating terms

Taiwan is one of the most economically advanced countries in the world. Its GDP per capita adjusted to PPP is the 8th highest in the world. There is no shortage of employment opportunities in Taiwan. When negotiating terms of employment in Taiwan, employers should make sure that they are clear about the terms of employment from the outset. Disputes can lead to huge costs to companies and are a nightmare from a public relations perspective. The Taiwanese take their work seriously and prefer personal interaction over emails or phone calls.

The LSA treats fixed-term and indefinite-term workers similarly on most rights, but differs on notice and severance. Layer in the agency loophole rules and the 90-day reclassification window for misclassified workers, and the cost of getting classification wrong becomes material.

Skuad supports both hiring models from a single platform:

EOR for full-time employees

• Acts as the legal employer across 160+ countries, so you can hire without setting up a local entity
• Supports employment contract generation aligned with local labor laws across supported markets
• Facilitates statutory contribution workflows covering applicable social insurance and pension obligations
• Supports payroll processing in 70+ currencies with automated tax withholding and year-end reconciliation
• Helps administer statutory benefits, paid leave, and parental entitlements in line with local requirements
• Assists with termination and offboarding, including notice and severance calculations as required locally

EOR for contractor management

• Helps onboard contractors with locally compliant agreements that reduce misclassification exposure
• Supports invoice generation, approval workflows, and payment processing in local currency
• Helps flag classification risk before it becomes a compliance issue with built-in worker classification checks
• Facilitates multi-currency payouts across 70+ currencies with no manual reconciliation
• Helps manage contractor records, contracts, and payment history from a single dashboard alongside full-time employees

Full-time or contractor, Skuad supports both. See pricing

Hiring in Taiwan

The hiring process in Taiwan varies by company and job description. Many Taiwanese companies have a referral program where existing employees can suggest candidates for hire. Companies also hire fresh graduates straight from college.

The typical hiring process involves shortlisting candidates after reviewing CVs. After shortlisting, companies often conduct aptitude and skill tests to make sure the candidates are equipped for the job.

After the management interviews and shortlisting them, there is an HR round where the department sees whether the potential employee’s values and ethics are aligned with those of the company.

Companies often hire with the help of job portal services like 104.com, Startupstadium, etc., and with the help of their employee network. Hiring is a cumbersome process and requires a lot of time and energy. There is no guarantee that the companies will find the employees who are best suited for the job. This is true especially for companies that are just venturing into Taiwan.

Being unaware of the social and cultural practices of the country is another advantage, and business practices often differ from country to country. As such, it becomes tedious and inefficient to hire employees.

There is a more straightforward way for hiring companies in Taiwan to get the best employees from the talent pool. Skuad’s EOR solution in Taiwan acts as an employee of record or a professional employee organization to take the hiring process off your plate so that you can focus on expanding your business.

Skuad supports background checks as part of the hiring workflow, covering identity verification, employment history, and education credentials, so you know exactly who you're onboarding before contracts are signed.

Probation and termination

Probation in Taiwan

Probation isn’t explicitly mentioned in the Labor Standards Act. The Act mentions a trial period instead. The requirements for such a period are not stringent in Taiwan, unlike in other countries.

Probationary period in Taiwan

There is no standard probation period in Taiwan. Instead, the Act allows employers and employees to negotiate the duration of probation. There is no upper limit to the period. However, the usual practice is that it goes on for 3 months, after which employers decide if they will retain the employee for good.

Termination of employment in Taiwan

Employers cannot fire employees at will in Taiwan. If an employer wishes to terminate a worker’s employment, they have to follow the guidelines stipulated in the Labor Standards Act. Employers have to serve notice and pay severance if they want to terminate employees. Moreover, they can do so only in the following cases:

• If the business operations cease or if there is a change in ownership
• Business loss
• If business operations are stopped for more than a month due to unforeseeable events
• Reorganization or downsizing of the business
• If the employee is incompetent

Employers can fire employees without notice and severance pay in the following situations:

• If the employee misrepresented facts at the time of signing the contract, and if such misrepresentation can cause damage to the employer.
• If the employee has committed an act of violence against the employer, his family or representatives, or any other employee.
• If the employee has violated his employment contract or the rules of the organization.
• If the employee has caused damage to the property of the employer.
• If the employee has disclosed confidential information about the employer.
• If the employee has remained absent from work for three days consecutively or more than six days in a month without intimation.

Termination in Taiwan needs a valid LSA cause, statutory notice of 10 to 30 days based on tenure, and severance calculations that compound quickly with length of service.

Discriminatory termination carries fines of TWD 300,000 to TWD 1,500,000 per violation under the Employment Service Act and the Act of Gender Equality in Employment. The cost of a single mishandled exit can wipe out months of payroll savings.

Skuad helps you to stay aligned with local labor laws, helping you to ethically manage your workforce.

Book a demo to see how Skuad supports Taiwan termination workflows end-to-end

EOR solution in Taiwan

The Taiwan Employer of Record (Taiwan EOR) solution makes it easier and faster for businesses to expand into Taiwan. The EOR way makes the employment process easy and smooth by handling all the employment responsibilities without setting up an establishment in Taiwan.

Setting up a Taiwan subsidiary takes 4 to 8 weeks, demands TWD 5 million to TWD 10 million in registered capital, and commits your legal and finance teams to ongoing entity maintenance before a single employee is onboarded.

Skuad helps remove that dependency. Skuad acts as the legal employer in Taiwan, so your company can hire, onboard, and pay employees without entity setup, local legal counsel, or in-house Taiwan payroll infrastructure.

Here is what Skuad helps with:

• Employment contract generation across 160+ countries, aligned with local labor laws and statutory requirements
• Statutory contribution workflows across supported markets, covering applicable social insurance and pension obligations
• Payroll processing in 70+ currencies with accurate tax withholding and statutory deductions
• Termination and offboarding support aligned with local labor requirements across supported markets
• Work permit and visa support for foreign nationals joining your team
• Background verification covering identity, employment history, and criminal records before onboarding

Outsourcing employment through an EOR

To expand into Taiwan, you need to decide whether you want to build an in-house team or use an EOR solution to manage all employment-related matters. Partnering with a local EOR will save precious time that would have been spent in the time-consuming hiring process.

Skuad’s Taiwan EOR provides tailor-made contracts, establishes all processes in compliance with local laws, and provides easy and convenient e-signing of documents through its high-tech Global Platform.

Types of visas

Work permit in Taiwan

As an EOR platform in Taiwan, Skuad assists with all the responsibilities and compliances related to employment. Taiwan work permits for foreigners are a necessity for hiring a workforce in Taiwan.

Being an advanced economy, Taiwan has a high standard of living, and there are many business opportunities in Taiwan. To work in Taiwan, you will need a work permit. However, Taiwan only allows highly skilled workers to work in the country. A job offer is mandatory before applying for the work permit.

Additionally, the applicant will need to have at least 5 years of experience in the field he/she is applying for. It is not possible to have a Taiwan work permit without a job offer.

Payroll and taxes in Taiwan

Employers have to withhold certain payments for obligations such as social security payments, income tax, etc. The income tax in Taiwan is progressive and ranges from 5 to 40%. Additionally, the social security payments consist of health insurance and labor insurance schemes. Employers and employees have to contribute to these schemes together.

It’s crucial to know Taiwan's employer payroll taxes. Employers often find it tough to manage payroll, especially when operating remotely. That is why we see a growing trend of payroll outsourcing in Taiwan.  

Skuad helps you make payments quickly in local currency. Moreover, it takes away any concerns about complying with the local laws and regulations, as Skuad will take care of the compliance issues. Among Employer Of Record companies in Taiwan, Skuad is the most efficient and effective.

Taiwan payroll tax rates

Employer taxation

Employee taxation

Use Skuad's employee cost calculator to model gross-to-net payroll in Taiwan, including employer contributions, statutory benefits, and applicable tax bands. It runs on the same data Skuad uses to process live payroll, so the estimate matches what you'd actually pay.

Calculate the cost of your next Taiwan hire

Bonuses

Bonuses are commonly paid before Chinese New Year, with the 13th and 14th months of salary offered, but this isn’t a compulsion. Employers may also distribute a portion of net profits to employees if they wish, with all the terms and conditions documented.

Up to NTD 3,000 could be excluded from the employee’s income for tax purposes if they are providing a meal allowance as an additional benefit.

Incorporation: How to set up a subsidiary in Taiwan

Doing business in Taiwan opens up a lot of doors for companies. However, setting up a subsidiary company in another country is not an easy task. It’s advisable to take due diligence and be aware of the business practices of Taiwan to know if Taiwan is the right fit for you.

Language is another factor to be considered. The most common language of Taiwan is Mandarin. Other than that, people also speak Hokkien and Hakka. It is advisable to hire a translator if you don’t know these languages.

The first step in incorporation is to obtain a Foreign Investment Approval (FIA) from the Investment Commission (IC) set up under the Ministry of Economic Affairs (MEA). The relevant subsidiary laws will differ based on the type of company being formed, a limited or unlimited company, limited by shares, or an unlimited company with limited liability. When incorporating a company limited by shares, there are restrictions on the amount of capital, investments, loans, and guarantees.

Foreign Investment Approval from the Investment Commission, capital restrictions for share-limited companies, and entity-type-specific subsidiary laws make subsidiary setup in Taiwan a multi-month exercise. For teams hiring fewer than 15 to 20 people, the cost rarely pays back.

Professional Employer Organization (PEO) Taiwan

A professional employer organization can make life easier for companies to hire employees in Taiwan. A PEO is an outsourcing organization that takes care of compliance, payroll management, HR services, payroll taxes, health benefits, and all the other things that go with employing workers.

They differ from Employers Of Record (EOR) companies in that, with a PEO, employees are contracted to the employer rather than the EOR.

Organizations planning to expand into new territories are better suited with a global EOR, which becomes the legal employer on behalf of the organization. Instead of associating with a PEO, a co-employment partner, organizations have more to gain by utilizing the services of an EOR solution.

The EOR solution safeguards organizations from unexpected policy changes, loss of control, and potential risks as the EOR bears every legal liability for the organization. In addition to these, the EOR handles payroll, tax, and employment law compliance.

Employer of Record in Taiwan: Hire without an entity

The right EOR partner can make all the difference. Skuad supports the operational complexity of hiring in Taiwan, Labor Standards Act compliance, labor insurance and NHI contributions, payroll in 70+ currencies, statutory benefits, work permits, and termination workflows so your team can focus on the work, not the paperwork.

Companies across SaaS, fintech, hardware, and technology services use Skuad to support their entry into the Taiwanese market, stay aligned with regulations as they change, and scale their Taiwan workforce without building local HR infrastructure from scratch.

Book a demo to see how Skuad gets your first Taiwan hire onboarded in weeks, instead of months

FAQs

1. What is an employer of record in Taiwan?

An employer of record (EOR) in Taiwan is a local entity that legally employs workers on behalf of a foreign company, while the foreign company directs day-to-day work while the EOR handles statutory filings and tax obligations.

2. How much does an employer of record in Taiwan cost?

EOR service fees in Taiwan typically range between USD 199 and USD 700 per employee per month, depending on provider and scope. On top of the service fee, employers contribute around 18 to 22 percent of gross salary toward labor insurance, National Health Insurance, and the 6 percent labor pension.

3. Can a foreign company hire in Taiwan without setting up a local entity?

A foreign company can hire in Taiwan without a local entity by partnering with an employer of record. The EOR holds the registered Taiwan entity and acts as the legal employer for compliance, while the client company manages the worker's day-to-day responsibilities.

4. What are the penalties for misclassifying workers in Taiwan?

Misclassifying employees as contractors in Taiwan can lead to back payment of labor insurance and pension contributions, plus late fees from the local labor bureau. For unlawful or discriminatory termination, fines under the Employment Service Act and Gender Equality in Employment Act range from TWD 300,000 to TWD 1,500,000 per violation.

5. How quickly can an EOR onboard an employee in Taiwan?

An EOR can typically onboard a Taiwan-based employee within 1 to 7 working days once the offer is accepted and documentation is in order. The timeline covers contract generation aligned with the Labor Standards Act, labor insurance, National Health Insurance enrollment, and pension setup.

6. What is the difference between an EOR and a PEO?

An EOR acts as a legal employer, taking full responsibility for hiring and compliance. Whereas PEO operates under a co-employment model, sharing legal responsibilities with the client company.