Luxoft Loyalty Program: Gift Tax Information by Location
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Luxoft Loyalty Program: gift tax information by location September 2021 Tax (PIT, Social Value limits for non- Who remits tax to the tax authorities Country contributions, other payroll Tax rate taxable gifts in local Means of tax payment Additional comments Local finance team Tax controller Employer Branding Manager (employee / employer) tax) currency (if any) 1. Report and pay tax on benefits provided to an employee that are more than $300 on Fringe Benefit Tax Return as an employer 2. Report Fringe Benefits provided to an employee FBT Payment by the that exceeds $2,000, the employee will need to Patil Kedar Olga Gorelova Thi Thu Huong Nguyen Australia Fringe Benefit Tax (FBT) 49% for FY2021 AUD 300 Employer Employer and Yearly include this amount in his/her tax return. Neither [email protected] [email protected] [email protected] lodgment the employer nor the employee pay tax on Reportable Fringe Benefit Amount, this amount affects the employee’s entitlement to certain tax rebates and social security benefits Deduction from employee Employer (deducts from employee Gross value including VAT is taxed, as VAT is non- Toncheva Gergana Evgeniya Cherkasova Iliyana Geosheva Bulgaria Personal income tax 10% No limit salaries made by salaries and remits to tax authorities) deductible for gifts [email protected] [email protected] [email protected] employer Both for CPP Contributions (an employee pays half the required Anything above $500 must be included in Park Annie contributions and an employer pays employee income. If the fair market value (FMV) of CPP Contributions and [email protected] Olga Gorelova David Oliva Canada Varies per employee CAD 500 annually the other half) and Employer for Payroll the gifts and awards given to employee is greater Income tax Stanowiec Andrea (HR) [email protected] [email protected] Income tax (deducts Income tax from than $500, the amount over $500 must be included [email protected] employees' salary and remit to the tax in the employee's income. authorities) Deduction from employee In the case of pens/notebook/clothes, they will be Employer (deducts from employee Wang Chunli Gilyana Sanginova Thi Thu Huong Nguyen China Individual income tax 20% CNY 2000 salaries made by the company's' expense, and we don’t need to pay salaries and remits to tax authorities) [email protected] [email protected] [email protected] employer PIT for it The non-taxable gift value cannot exceed 5% of the Gift value cannot social security monthly ceiling (in 2020 it is €3,428). Chuah Bee Bee, exceed 5% of the social Deduction from employee 20% for employee and Therefore, any gift valued more than [email protected] Gilyana Sanginova Iliyana Geosheva France Social tax and income tax security monthly ceiling Both, as it is considered regular salary. salaries made by about 45% for employer €3,428*5%=€171,4 will be considered as a “benefit Lee Wan Yin Adelene [email protected] [email protected] (in 2020, this is 5% of employer in kind," and will be submitted to all social taxes [email protected] €3428 = €171,4) and income tax. Personal income tax About 35% Gifts received from legal entities for a total value of Both income tax and social security are less than €44 per month are tax-and social- deducted from employee salaries and Deduction from employee Kraus Kathrin security-exempt. If an employee receives gifts Tatiana Batueva Stephani Hendrichs Germany €44 monthly sent from employers to the respective salaries made by [email protected] whose value exceeds €44 per month, the whole [email protected] [email protected] authorities along with the employer’s employer Baur Heike sum is taxable. The tax percentage depends on the contribution to social security About 21% for employee tax class of each employee. Social security contribution and 22% for employer www.luxoft.com 2 Tax (PIT, Social Value limits for non- Who remits tax to the tax authorities Country contributions, other payroll Tax rate taxable gifts in local Means of tax payment Additional comments Local finance team Tax controller Employer Branding Manager (employee / employer) tax) currency (if any) It will be count as company expenses and won't be Wang Chunli Gilyana Sanginova Thi Thu Huong Nguyen Hong Kong N/A N/A N/A N/A N/A included in salary tax. [email protected] [email protected] [email protected] Acharya Deepak Gilyana Sanginova Pragnya Nagaraj India N/A N/A N/A N/A N/A Only gifts in cash are taxable in India [email protected] [email protected] [email protected] 23% or 27% or even higher, PIT (IRPEF) depending on taxable income Gifts exceeding €258,23 are taxed both as INPS Employer includes the Employer includes the value of the gift (9,49%) and as IRPEF. According to IRPEF, each value of the gift in the pay Otilia Pomian Tatiana Batueva Iliyana Geosheva Italy € 258,23 in the pay slip and it is taxed employee pays on their pay slip. slip and it is taxed [email protected] [email protected] [email protected] automatically The value of the gift must be included in the pay automatically slip and the excess will automatically be taxed. Social security contribution 9,49% (INPS) Refer to this public ruling: http://lampiran1.hasil.gov.my/pdf/pdfam/PR_05_2 019.pdf Exempt from tax: 1. Staff benefits (e.g. backpack, mug, etc.) 2. Personal appreciation (e.g. birthday/wedding gifts etc.) 3. Paragraph 25C, schedule 6 of the ITA excellent Deduction from employee service, long service, past achievement, innovation, Rate depends on employee Employer (deducts from employee Khaw Kia Shuan Evgeniya Cherkasova Thi Thu Huong Nguyen Malaysia Personal income tax No limit salaries made by or productivity awards, limited to RM 2,000 annual income salaries and remits to tax authorities) [email protected] [email protected] [email protected] employer Subject to tax: 1. Convertible to cash, can be sold/transferred in respect of exercising employment (e.g. personal computer, iPad, phone - following market value; Scooter, bicycle). These are considered perquisites. 2. The employer is required to report in the employee statement of remuneration (Form EA and EC) and Form E for the employer for perquisites. As of now gifts received by employees are not Tello Fernanda Tatiana Batueva David Oliva Mexico N/A N/A N/A N/A N/A reported in payroll and are not subject to any tax [email protected] [email protected] [email protected] to apply PIT and social security In principle, fringe benefits, i.e. any remuneration Deduction from Personal income tax; Social contributions 37,35%-49,5% Employer (deducts from employees' in kind received by an employee from his Sjostrand Ulrika Tatiana Batueva Iliyana Geosheva Netherlands No limit employees' salary made contributions depending on taxable salary and remit to the tax authorities) employer, are valued at market value and taxable [email protected] [email protected] [email protected] by an employer income as employment income www.luxoft.com 3 Tax (PIT, Social Value limits for non- Who remits tax to the tax authorities Country contributions, other payroll Tax rate taxable gifts in local Means of tax payment Additional comments Local finance team Tax controller Employer Branding Manager (employee / employer) tax) currency (if any) As a rule, an employee is a tax payer. Gifts and taxation are Personal income tax; Social However, at LXT PL, gifts are grossed Regardless of gift value, if given to Luxoft Mikula Lukasz Olga Gorelova Malgorzata Stasiak Poland 17% No limit processed through contributions up so that employees do not feel the employee, it's subject to taxation. [email protected] [email protected] [email protected] payroll burden of taxation 1. Employee taxes: social security 25%, health security 10%, salary income Small value goods that Please note that we are currently grossing up the tax 10%, but this may be have the Luxoft logo on Employer (gross up the net amount so Gross up the net amount net amount so that the employee is not impacted Salary income tax, social reduced to nil if the them are not Danila Loredana Evgeniya Cherkasova Cristina Cotutiu Romania that the employee is not impacted by so that the employee is by this specific form of taxation. In addition to this, security employee is exempt from considered as being [email protected] [email protected] [email protected] taxation) not impacted by taxation VAT is not deducted and is recognized as an salary income tax salary assimilated expense (applicable to employees income working in IT). 2. Employer taxes : 2,25% Gifts received from legal entities for a total value of less than RUB 4,000 per year are tax exempt. If an Deduction from Employer (deducts from employee employee receives gifts for more then RUB 4,000 Nesterova Irina Evgeniya Cherkasova Kristina Zhiliaeva Russia Personal income tax 13%/30% for a non-resident RUB 4,000 per year employee salaries made salaries and remits to tax authorities) per year, the difference between the total amount [email protected] [email protected] [email protected] by employer and RUB 4,000 is taxable (13%, the rate is 30% if the employee is a non-resident) All gifts are not taxable if the value of each gift does not exceed $200. If the gift exceeds the exemption threshold, the whole value is taxable in full. Chuah Bee Bee, Based on resident tax rates Employee (an employer declares the Online or cheque For example, an employee is given a cash gift of [email protected] Gilyana Sanginova Thi Thu Huong Nguyen Singapore Personal income tax or, for non-residents, a flat SGD 200 for each gift gift in the tax return, then the payment $200 for his wedding, a birthday gift of $50, and a Lee Wan Yin Adelene [email protected] [email protected] rate of 15% employee needs to pay tax) Christmas gift of $80 in the same year.