zondag 10 februari 2013

Employers levy on high salaries above € 150,000 in 2012 - included in the wage tax return for March 2013

On March 31, 2013 employers may be faced with a special levy if they employed workers in 2012 who earned a salary of more than € 150,000. This levy was introduced because politicians thought that the higher incomes should also contribute to the crisis. However, the contribution was not intended to harm the workers and the entrepreneurs themselves. Therefore the politicians opted for an employer levy. 

Employers levy on high wages

The employers levy is based on the salary from current employment for the year 2012, including all structural and incidental rewards and therefore including the addition for the company car. The employers levy has to be paid once in 2013 and amounts to 16% on the excess of the salary above € 150,000. This levy comes on top of the regular wage tax withholdings and levies which the employer has to pay to the tax authorities. 

Employers levy in practice

Suppose an employee earned an annual salary of € 180,000 in 2012. The excess above € 150,000 is taxed with 16% in 2013. The difference between € 180,000 and € 150,000 is € 30,000. On this amount the employer levy is calculated. The levy amounts to 16% of € 30,000 = € 4,800. The levy has to be paid with the wage tax return which sees on the period in which March 31 falls, so based on monthly filings, the latest on April 30. 
The employer levy is a one-off payment and will not return in 2014 (although the actual text of the regulation is not entirely clear about it). 

If the employee had several jobs in 2012, the employers will not have to pay the employers levy, provided none of the employers paid a salary higher than € 150,000 in 2012. If the employee worked within a group of companies under different contracts then the exemption is not applicable. In that case, the calculation must be based on the total salary earned within the group in 2012. The employer within the group that paid the majority of the salary in 2012 must pay the employers levy.

Anti abuse measurements

If the employee has also worked as a freelancer for the same company, the income earned as freelancer will be included in the calculation to determine whether the employer paid more than € 150,000 to the employee. The government will take additional measurements if it turns out that employers find other ways to prevent the employers levy. The goal is to collect 500 Million with this levy. 

Levy can hit all kinds of employers

Besides employers in commercial business, the levy can also affect employers in the public sector like public television, housing corporations, hospitals etc. These organisations also employ a lot of employees with a salary above € 150,000. 

The measurements also affect sport clubs, like for example football clubs. If they employ (foreign) football players with a salary above € 150,000 they will also be confronted with the tax claim which can lead to a claim of millions of Euro's for the top football clubs in the Netherlands. 

Payroll administration

Make sure that your payroll administration is done properly and that the employers levy is calculated properly. Expatax is specialized in providing payroll services, especially to foreign companies who send employees to the Netherlands but also to the Dutch companies who hire the foreign employees. These can be commercial businesses but also football clubs who rent a football player to a Dutch football club. Recently Expatax has set up a payroll on behalf of AFC Bournemouth with respect to renting out Demouge to Roda JC. 

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