Case Scenario
Ms. Lin is the person in charge of a small and medium-sized enterprise with a total of 10 employees. While preparing payroll, she found that in addition to the labor and health insurance for employees, she also needed to pay extra health insurance premiums for employees according to the regulations of "Taiwan Second-Generation National Health Insurance". She has several questions:
- What is the employees' supplementary premium? How should it be calculated?
- What is the employer's supplementary premium? How should it be calculated?
- Who is responsible for withholding these supplementary premiums, and how should they be declared and paid?
- When an employer receives distributed profits from their operating business, how should the supplementary premium be calculated?
Case Explanation and Second-Generation NHI Analysis
After the implementation of Taiwan's Second-Generation National Health Insurance (NHI), in addition to the general premiums withheld monthly based on salary, a "Supplementary Insurance Premium" (Supplementary Premium) system has been implemented for six specific categories of "high-amount" or "non-frequent" income. This premium is paid by individual employees and employers respectively, according to different standards. Currently, the supplementary premium rate for both individual employees and employers is 2.11%.
1. Standards and Payment Regulations for Employee (Individual) Supplementary Premiums
The purpose of the supplementary premium is to collect contributions from those with "non-wage" or "high-amount non-frequent" income.
The following table:
|
Supplementary Premium Category |
Applicable Subject and Items |
Withholding Standard (Threshold) |
|
High-amount Bonuses |
The portion that cumulatively exceeds 4 times the monthly insured amount. (Usually year-end bonuses, performance bonuses, profit-sharing, etc.) |
Cumulatively exceeding 4 times the insured amount |
|
Part-time Wages |
Part-time income from a non-insured unit (a company other than the main employer). |
Single payment amount exceeding NT$28,590 (2025 standard) |
|
Other Types of Income (Professional practice income, dividends, interest, rent, etc., paid to the public) |
Single payment amount exceeding NT$20,000 |
|
Explanation of Bonus Supplementary Premium Calculation
On February 5, 2025, Employee A was given a year-end bonus of NT$100,000 for the first time. The monthly insured amount for that month was NT$30,300, and the bonus did not yet exceed 4 times the insured amount. On September 5 of the same year, Employee A was given a Mid-Autumn Festival bonus of NT$100,000 for the second time, with a cumulative bonus payment of NT$200,000. Therefore, the supplementary premium of NT$1,663 for the bonus should be withheld upon the second bonus payment.
Calculation: (1) The first bonus payment of NT$100,000< NT$121,200 (NT$30,300×4), so no withholding is required. (2) The second bonus payment is NT$100,000, cumulative total is NT$200,000> NT$121,200. ($200,000 - $121,200) × 2.11% =1,633.
Payment Method:
- The payment unit (such as the employer, company distributing dividends, etc.) directly withholds the supplementary premium when disbursing the funds.
- The payment unit prepares the supplementary premium payment slip and makes the payment before the end of the month following the payment date. By January 31 of each year, the detailed statement of withholdings for the previous year must be declared to the National Health Insurance Administration (NHIA).
2. Standards and Declaration Methods for Employer (Company) Supplementary Premiums
The supplementary premium payable by the employer is irrelevant to the individual income of the employee. It is calculated based on the difference between the company's monthly taxable "total salary" (Income Format Codes 50, 79A, and 79B, such as taxable wages, part-time wages, or other incentive or subsidy income) and the total monthly insured amount of the unit's employees. This is called the "Employer's Supplementary Premium Burden". Furthermore, because certain items are not included in the salary income calculated under Income Format Code 50, such as the portion of retirement contributions voluntarily allocated by the worker within 6% of the monthly wage, meal allowances, and overtime pay within a certain monthly limit (46 hours), these parts will not be subject to supplementary premiums.
For example, in Ms. Lin's company, the total salary paid in October 2025 was NT$600,000 (including employee wages, taxable overtime pay, bonuses paid that month, etc.). The total insured amount of the employees that month was NT$450,000. The company should pay a supplementary insurance premium of NT$3,165 to the NHIA before the end of November 2025.
Calculation: The total salary paid in October 2025 the total insured amount of employees. The unit should pay the supplementary insurance premium of NT$3,165 before the end of the following month. ($600,000 - $450,000) ×2.11% =3,165 . Basis for Calculation: The intent of the employer's supplementary premium is to ensure that all taxable salaries issued by the company (regardless of whether they are included in the employees' general premium insured salary) are incorporated into the basis for calculating health insurance premiums.
Declaration and Payment Methods:
- Payment: The employer must fill out the "Supplementary Insurance Premium Payment Slip" before the end of the month following the payment date. They then declare and pay this difference in supplementary premium to the NHIA, without needing to declare again to the NHIA.
- Annual Declaration: By January 31 of each year, the payment unit (withholding agent) must declare the details of the supplementary premiums withheld from insured persons (such as employees or external lecturers, consultants, etc.) in the previous year to the NHIA.
3. How should the supplementary insurance premium be calculated for dividend income obtained by the employer from their insured unit?
The employer should use the business income (including dividend income) as the insured amount to calculate the general insurance premium. To avoid double deduction, when the company distributes employer dividends, it can first deduct the total insured amount of the employer for the months of their enrollment in the company's insurance, and then calculate the dividend supplementary insurance premium. For example, Ms. Lin is enrolled in her own company's insurance as the person in charge (employer), with a monthly insured amount of NT$182,000. In August 2025, the company distributed 2024 earnings, issuing a dividend of NT$6,000,000 to Ms. Lin. The company should withhold a supplementary insurance premium of NT$80,518 for Ms. Lin's dividend income. Calculation: Ms. Lin's dividend is NT$6,000,000. The total insured amount of the person in charge for 2024, NT$2,184,000 (182,000 ×12), can be deducted. The company should withhold a supplementary insurance premium of NT$80,518. ($6,000,000 - $2,184,000) × 2.11%=80,518 .
