It’s a common misconception that you need to establish a foreign entity to expand and operate in another country. Our PEO solution allows your company to enter and hire in Taiwan without setting up a foreign entity straight away. It’s the perfect solution if you’re thinking of taking your first steps into the Taiwanese market.

What is a PEO?

PEO stands for Professional Employer Organization, but what does that really mean? PEOs provide a range of services for small to medium businesses that are unable to provide for themselves. However, PEO services are not one-size-fits-all, so a company can select which services it wants to retain a PEO to handle, from payroll, benefits and tax administration to hiring and ensuring regulatory compliance.

PEOs may be used domestically or internationally. They are similar to another international business concept called EOR, or Employer of Record. When discussing an Employer of Record in Taiwan, the PEO provides similar services. However, there are some differences you should know in order to select the right service.

An EOR covers you under their insurance, whereas you need to maintain your own business insurance when working with a PEO. An EOR in Taiwan will be registered in the country, thus you can operate your business without needing an independent registration.

Why use a PEO in Taiwan?

As the seventh largest economy in Asia, Taiwan offers many attractive opportunities to Western businesses and provides an excellent gateway to access other economies in the region. Companies setting up in Taiwan can benefit from favorable tax advantages when compared to its Asian neighbors, including reduced corporate tax.

While companies can get started independently without the use of a PEO, there are many benefits to working with a PEO to expand your business in Taiwan. To open a business independently requires a company to first set up a local entity and become incorporated. This is a lengthy, time-consuming process that many businesses would prefer to avoid, if given the option.

Since a PEO is already up and running in Taiwan, it can operate all payroll and tax services on behalf of the incoming business; ensure that the business is complying with local laws; arrange for visas and work permits; handle all other immigration and labor issues; and deal with the Taiwanese government as required.

The benefits of using a PEO can last long after your business is up and running. Since a PEO is based within the region, it is better able to make headway on tasks that might otherwise be difficult to solve from overseas, such as regulatory obstacles or international business logistics. With a PEO in your corner, you can pivot your business model quickly to address any challenges that arise while taking full advantage of a dedicated local workforce.

The reality is that most companies do not need to go through the process of setting up a local office — and learning all the rules associated with doing business in Taiwan — just to enter this new market. At the end of the day, global companies want quick access points to new markets, and a Taiwanese PEO delivers just that.

To illustrate, here are some of the tasks that INS Global has taken care of as PEO for companies operating in Taiwan:

• Hired employees in record time
• Drove our clients’ growth in a new market
• Maintained compliance with employment and tax law in Taiwan
• Reduced time spent processing HR and administrative tasks
• Streamlined their global expansion

Key Points to Consider When Selecting a PEO

While a PEO may at first glance seem similar to a staffing agency, by now you should understand that a trusted PEO actually provides more comprehensive services than a staffing agency. They act as your Human Resources department by ensuring compliance with immigration, employment and labor laws. They also act as a liaison with the Taiwanese government and handle key accounting and bookkeeping functions.

You still retain the authority to hire and fire employees, just as you would at your primary location. However, a PEO is the organization that holds those work contracts with employees. You pay the PEO for their services; the PEO then pays the employees for the work they do with your company.

Armed with this background information on how a PEO operates, you should carefully consider the following when choosing a partner with which to work:

• Experience in the region: Since a PEO is acting on your behalf, it must be intimately familiar with the labor laws within the host country, in this case Taiwan. If the PEO does not comply with all laws, the Taiwanese government will issue penalties.
• Reputation and legal liabilities: Given that a PEO is representing you, it stands to reason that the PEO’s reputation — and any legal liabilities — deserve top of mind consideration. Check whether there are any lawsuits against the PEO. Lawsuits related to failure to follow local laws would be a major red flag that the company is skirting the lines of legality and should be avoided.
• Key stakeholders and controlling ownership: A PEO is comprised of individuals with values, work experience and interests. Check into the ownership of the PEO, its organizational structure and its relationship with other clients to decide if it is an entity with which you want to do business.
• Scope of services: PEOs have multiple clients, so you likely will not be their only consideration. The upside of this fact is that PEOs are able to leverage economies of scale to obtain better pricing considerations on services such as insurance or technology. So, as you compare one PEO with another and decided which PEO partner is right for you, make sure you understand the scope and the cost of their services.

Why use INS Global as your PEO in Taiwan?

• Full employment – Your employee is legally employed by INS Global in Taiwan exclusively on your behalf.
• Compliance – Your employee’s salary is processed through our payroll in Taiwan with tax deducted and paid to the relevant authorities.
• Peace of mind – We remain up to date with the latest changes to employment and tax law in Taiwan so you don’t have to.
• Ongoing support – We offer visa application support for your foreign employee as well as accompanying them through the onboarding process.
• Streamlined and transparent approach – We invoice you every month for our services including your employee’s wage, benefits and expense reimbursement.

Taiwan offers a whole host of advantages to foreign businesses looking to tap into new and emerging markets. Situated within close proximity to the capitals of the ASEAN countries, it boasts an educated workforce, sound legal environment and emphasis on intellectual property rights, making it a strong contender among other Asian nations. Whether you are looking to take your business to Taiwan or find the right staff in Taiwan our comprehensive business solutions can help your business expand easily.