The deduction fork in the road
When filing individual income tax (綜所稅), you pick either the standard or the itemized deduction — not both.
- Standard deduction (標準扣除): in 2024, NT$131,000 single / NT$262,000 married joint (fixed amount)
- Itemized deductions (列舉扣除): sum of actual qualifying expenses, item by item
Which one? Simple rule: whichever produces a higher amount. But many people overlook itemizable items and miss out on real tax savings.
The 5 main itemizable categories
1. Charitable donations
- To government bodies, public schools, education/cultural/charitable public-interest organizations: up to 100% deductible (with conditions)
- To private charities: capped at 20% of aggregate income
- Common examples: Red Cross, World Vision, Tzu Chi, Fo Guang Shan, NTU, NCCU, etc.
- Required: donation receipts (electronic receipts accepted)
2. Personal insurance premiums
Cap: NT$24,000 per person per year (NHI premiums are on top of this cap).
Qualifying types:
- Life insurance
- Medical insurance (expense reimbursement, hospitalization per diem)
- Accident insurance
- Annuity insurance
- Your own share of labor insurance
For married joint filers, the NT$24,000 cap applies independently to each person.
3. Medical expenses
No cap (but net of insurance reimbursement). Conditions:
- Receipts from public hospitals or NHI-contracted clinics
- Must be treatment-related (cosmetic, health checkups, optional vaccines don't count)
- Must deduct any insurance payouts received
Commonly counted:
- Out-of-pocket surgery fees
- Orthodontics, dentures (for treatment)
- Long-term medications (chronic illness)
- Out-of-pocket hospitalization charges
4. Home mortgage interest (self-occupied)
Cap: NT$300,000 per filing household per year. Conditions:
- Must be a self-occupied residence (household registration + personal residence)
- One property only (if you have two mortgages, pick one to claim)
- Net of interest income
Calculation:
Claimable amount = mortgage interest paid − bank interest income that year
Example: NT$250K in mortgage interest, NT$20K in bank interest income → claim NT$230K.
5. Rent paid
Previously itemized; as of 2024, reclassified as a special deduction (no longer competes with standard/itemized).
- Cap NT$180,000 per household (raised from NT$120,000 in 2024)
- Requires that you, your spouse, and dependents own no property
- Need rental contract and payment proof
Standard vs itemized: quick check
Pick itemized immediately if:
- You have a self-occupied mortgage (interest typically NT$100K–300K) → itemized almost always wins
- Large medical expenses this year (NT$50K+) → itemized wins
- Large donations (NT$30K+) → itemized wins
- Total household insurance premiums NT$100K+ → itemized wins
Pick standard if:
- Single, renting, no major medical or donation expenses
- Itemized totals are under NT$131,000 (single standard)
Worked examples
Case 1: Salary earner with no mortgage
- Premiums (self + spouse + 2 children): 24,000 × 4 = NT$96,000
- Donations: NT$10,000
- Medical: NT$20,000
- Total itemized: NT$126,000
Single standard NT$131,000 > itemized NT$126,000 → pick standard
Case 2: Household with mortgage
- Mortgage interest: NT$220,000
- Premiums: NT$96,000 (married joint)
- Medical: NT$15,000
- Total itemized: NT$331,000
Married standard NT$262,000 < itemized NT$331,000 → pick itemized (extra NT$70K deduction; at the 20% bracket, saves NT$14,000 in tax)
Case 3: Large donation year
- Single, donation NT$200,000 (with receipts)
- Premiums NT$24,000
- Medical NT$10,000
- Itemized: NT$234,000
Single standard NT$131,000 < itemized NT$234,000 → pick itemized (extra NT$103K deduction; at the 12% bracket, saves NT$12,400)
Filing process
When filing online:
- Fill in "dependents" and complete basic information
- Navigate to the "deductions" step
- Click "itemized deductions" to enter items line by line
- The system auto-totals and compares against standard
- Click "take the higher of the two"
Practical notes
Keep your receipts
Every itemized line item requires a receipt or proof. The tax bureau may audit:
- Donations: receipt (digital or paper)
- Medical: original receipt or hospital certificate (photocopies not accepted)
- Premiums: annual premium statement from your insurance company (request directly)
- Mortgage interest: annual interest payment certificate from your bank (request directly)
Joint filing specifics
- The NT$24,000 premium cap applies independently per person
- The NT$300,000 mortgage interest cap is shared per household
- The 20% donation cap applies to combined income
The "preschool special deduction"
As of 2024, NT$150,000 for the first child / NT$225,000 for the second and beyond. This is a special deduction — not part of the itemized/standard choice.
Disclaimer
This is a general explanation of deduction choices. Specific situations (cross-border deductions, unusual medical expense classifications) should be confirmed with a licensed accountant or the National Taxation Bureau.
Official sources
- eTax Portal (財政部稅務入口網) — deduction calculation, online filing
- Ministry of Finance (財政部) — annual deduction announcements
- Taxation Administration (財政部賦稅署) — interpretative ruling lookup