How to Start a Business in Taiwan
Taiwan sits in a geographically prime location for doing business in Asia. With a well-educated Chinese speaking population, it is an ideal spot for starting a business in China or other parts of Asia. Taiwan also has a cheap and under-hired workforce, with a large amount of bilingual speakers. In addition, Taiwan contains world-class expertise in the semiconductors and silicon industries. With a strong vibrant economy, Taiwan is an ideal place for many companies to expand their business.
How do I get started?
First you should think about what kind of entity you need to fulfil your business needs. Most foreigners will go with one of four business types:
Subsidiary: Limited Company or Company Limited by Shares
What are the differences between business entities?
Limited Company or Company Limited by Shares: These are full companies that would not be attached to the home country office and would be able to go public on the Taiwan stock exchange and receive more outside investment. These types of entities also attract the most taxes.
Representative Office: A representative office would be a liaison office and would not be able to import/export or sell products to local Taiwanese people. This would be ideal for companies looking to research the Taiwan market or assist the head office overseas in overlooking Taiwan operations. A rep office does not have to pay VAT or corporate income tax, and setup is usually very fast and inexpensive. One drawback is that a rep office may have trouble hiring foreigners. Here is a nearly complete guide to rep office registration: http://www.forumosa.com/taiwan/viewtopic.php?f=88&t=43055
Branch Office: A branch office is a branch of the head company overseas, and is 100% owned by the foreign company. Other than this, a branch has the same power as a company in import/export and issuing invoices. A major advantage to a branch office is that profits sent back to the head office are much less than that of a company.
For more information on the differences between types of business entities, please follow the following links:
Now I have an entity in mind, what to do I have to do to register?
You would need to prepare the following:
Chinese name of the company and manager
Company seal: A chop or stamp with the company name in Chinese.
Bank Account: Foreigners can open bank accounts in Taiwan. A preparatory bank account is required for entities not yet formed.
Foreign capital: You would need at least 5,000,000 NT if you are hiring foreigners, otherwise sufficient funds for operation costs.
Articles of incorporation
Notarize foreign documents: This will require you to notarize things like your business license in your home country with a notary public, and then authorizing this with the Taiwan consulate or equivalent there.
Statutory filings: Register insurance with the government. How to register with the government site: http://onestop.nat.gov.tw/oss/web/Show/engWorkFlow.do
How should I hire employees?
One of the most important decisions when setting up a business is who to hire for your foreign entity. You may search Taiwan on 104 https://www.104.com.tw/ or 1111 https://www.1111.com.tw/, but this may require Chinese language skills to operate. Many people go with trusted friends. I think it would be a good idea to hire someone with bilingual skills as well as experience doing business in Taiwan. Remember, if you hire foreigners, it is important that you have 5,000,000 NT starting capital and yearly income of 10,000,000 NT. The minimum salary for foreigners is 48,000 NT and the average salary for Taiwanese would be 30,000-50,000 NT depending on the job.
How much will setting up an entity cost me?
You could go through the registration process yourself to save money, but if you don’t know Chinese and don’t have experience, you could be between a rock and a hard spot. I would recommend finding a local CPA firm or law firm to help with this. If you are looking to save money, look for a small firm. If you are looking for quality, go with a larger firm. Here is a forum discussing this very topic: http://www.forumosa.com/taiwan/viewtopic.php?f=88&t=77674
Is there another way?
Yes, say if you have a Taiwanese spouse, you could have your spouse set up a local company. You could also just sell food illegally on the street and get fined every once in a while (which we do not recommend). However these are topics for another time in a separate blog post.
For further information, please check out the following websites:
Starting Business in Taiwan blogs/websites:
How to start a business in Taiwan. They have a book
Starting a business in Taiwan (short)
If you have any questions, be sure to message us.
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We are US Expats that have extensive experience living, working, and travelling in Taiwan. In our day, we had to learn many things about Taiwan the hard way. But we have come to learn that Taiwan is one of the best places in the world for Foreigners to live. Our blog does not represent the opinions of every foreigner in Taiwan. We are just trying to help others learn more about this beautiful country.