Executive summary

On 1 January 2026, Taiwan enacted amendments to the Act for the Recruitment and Employment of Foreign Professionals (New Scheme), significantly expanding pension and employment insurance obligations for foreign professionals. The amended rules took effect immediately.

Under the amendments, foreign professionals engaged in professional work in Taiwan are now required to participate in the New Scheme, regardless of permanent residence status. The changes impose mandatory employer pension contributions for a broader group of foreign employees and introduce transitional election rules for individuals previously covered by the prior rules (Old Scheme).

Companies with foreign professionals in Taiwan should review the amendments carefully to assess the impact on labor costs, payroll compliance and employee communications.

Key developments

Expanded eligibility for the New Scheme

Effective 1 January 2026, foreign professionals engaged in professional or technical (white-collar) work, as defined under Article 46.1.1 of the Employment Service Act, are required to participate in the New Scheme irrespective of permanent residence status.

Previously, participation was generally limited to foreign nationals who had obtained an Alien Permanent Residence Certificate (APRC) or were married to a Taiwan resident. As a result of the amendments, a significantly broader population of foreign professionals is now subject to mandatory pension coverage.

The amendments do not apply to mid-level technical workers or blue-collar foreign workers.

Mandatory employer pension contributions

The New Scheme requires employers to make monthly pension contributions to the employee's individual pension account of no less than 6% of the employee's insured salary. Contributions are subject to the statutory insured-salary ceiling (currently at 150,000 Taiwan dollars (TW$150,000).

Transitional arrangements

The New Scheme provides the following transitional arrangements:

• Foreign professionals who were employed prior to 1 January 2026 may elect to remain under the Old Scheme by submitting a written declaration to their employer by 30 June 2026.
• If an eligible employee does not make an election by 30 June 2026, the employee will be automatically transferred to the New Scheme.
• Once an employee has elected to remain under the Old Scheme or is transferred to the New Scheme, no subsequent change of pension regime is permitted.
• If an employee transfers from the Old Scheme to the New Scheme, prior tenure under the Old Scheme should be retained. However, pension payment related to prior tenure may be settled by mutual agreement between the employer and the employee. This settlement does not affect the employee's entitlement under the New Scheme.

Comparison of Old vs. New Scheme

Key dates

Employment insurance for permanent residents

Under the amended rules, foreign professionals who have obtained an APRC are also required to participate in employment insurance, enabling access to benefits such as unemployment compensation, subject to statutory conditions.

Practical considerations for employers

Employers should consider taking the following actions:

• Review 2026 labor cost projections to reflect mandatory pension contributions.
• Identify foreign professionals eligible for the Old Scheme election.
• Establish internal processes to manage employee elections and documentation.
• Update payroll and HR systems to ensure timely pension reporting and contributions.
• Monitor further implementation guidance from the Taiwan authorities.

Implications

The amendments represent a fundamental shift toward equalizing pension coverage between foreign and local professionals in Taiwan. Early planning and clear employee communication will be critical to managing compliance risks and cost implications.