COVID 19

Impact on Global Payroll: Update

Governments and institutions throughout the world, in the face of Corona Virus crisis, are announcing measures for the working community. We have compiled a list of these updates that will impact the Payroll of the respective countries.

We are working towards making these modifications, including payroll tax calculations and other legislative adjustments, reflect on Ramco HR & Payroll. If you are an existing customer and are looking to discuss this further, please reach out to the support team.

COUNTRY PAYROLL RELATED CHANGES



I. Stimulus measure “JobKeeper Payment” to keep employee at work and leaves during COVID-19

A. Update

Businesses significantly impacted by COVID-19 will receive payment of $1,500 per fortnight for each eligible employee (as at Mar. 01, 2020) as a wage subsidy from Mar. 30, 2020 to Sep. 27, 2020. Employers will be eligible for the subsidy if they suffered a decline in turnover of >50% (if turnover > S1 billion) or >30% (if turnover < $1 billion). To be eligible, an employee must be at least 16 year’s old, an Australian citizen, the holder of a permanent visa, a Protected Special Category Visa Holder, a non-protected Special Category Visa Holder who has been residing continually in Australia for 10 years or more, or a Special Category (Subclass 444) Visa Holder.

Application process

Employer to register (Expression of interest) through the ATO website and notify eligible employees and obtain confirmation through employee declaration statement before enrolling through either of the three methods (ATO Business Portal, Online services for agents, Online services for Individuals) from Monday, Apr. 20, 2020 till Apr. 30, 2020 and provide details about eligible employee’s and other information.

Reporting

Data needs to be reported to the ATO on a payment basis and also complete a monthly declaration online. The reporting can happen based on either of the 3 methods – Online (less than 200 employees, STP, File upload). In STP, Top up amount under Other allowances (JOBKEEPER-TOPUP description and YTD amount) and One time Start fortnight period (JOBKEEPER-START-FNxx) and last fortnight period if before 27th September 2020 (JOBKEEPER-FINISH-FNxx) needs to be reported for eligible employees.

JobKeeper related Leaves

This is available only for National system employer who qualify for the JobKeeper scheme and to eligible employees. The Employer will be able to temporarily, stand down an employee (including by reducing their hours or days of work), change an employee’s usual duty, change an employee’s location of work, and make an arrangement with employee. The payment shall be either the JobKeeper payment or their usual pay for any hours that the employee does work – whichever is more. The employee’s hourly base pay rate can’t be reduced. Further, the qualifying employer may request an employee in writing to take paid annual leave at half their usual pay for twice the length of time (keeping minimum balance of 2 weeks). Employees still accrue their usual leave entitlements for the period the agreement applies (as if the agreement hadn't been made). Service is considered continuous for the purposes of redundancy and pay in lieu of notice (i.e. it counts as time worked).

Other leave impact

The Fair Work Commission made determinations to 99 awards. The determinations inserted a temporary new schedule into these awards. The employees are eligible for 2 weeks of unpaid pandemic leave and ability to take twice as much annual leave at half their normal pay, if employer agrees.

The schedule in each award applies from an employee’s first full pay period on or after 8 April 2020 until 30 June 2020. This end date can be extended by application to the Commission.

B. Statutory Compliance Release Date: April 08, 2020

C. Effective Date: March 30, 2020


II. Job-keeper 2.0

A. Update

The Government is extending the JobKeeper Payment by a further six months to March 28, 2021.

Employer Obligation
  • From 28 September 2020, businesses and not-for-profits will be required to reassess their eligibility with reference to their actual GST turnover in the June and September quarters 2020. They will need to demonstrate that they have met the relevant decline in turnover test in both of those quarters to be eligible for the JobKeeper Payment from 28 September 2020 to 3 January 2021.
  • From 4 January 2021, businesses and not-for-profits will need to further reassess their turnover to be eligible for the JobKeeper Payment. They will need to demonstrate that they have met the relevant decline in turnover test with reference to their actual GST turnover in each of the June, September and December quarters of 2020 to remain eligible for the JobKeeper Payment from January 01, 2021 to March 28, 2021.
  • To be eligible for JobKeeper Payments under the extension, businesses and not-for-profits will still need to demonstrate that they have experienced a decline in turnover of:
    • 50 per cent for those with an aggregated turnover of more than $1 billion;
    • 30 per cent for those with an aggregated turnover of $1 billion or less; or
    • 15 per cent for Australian Charities and Not for profits Commission-registered charities (excluding schools and universities).

If a business or not-for-profit does not meet the additional turnover tests for the extension period, this does not affect their eligibility prior to 28 September 2020.

Job-keeper Payment Rates

From 28 September 2020 to 3 January 2021, the JobKeeper Payment rates will be:

  • $1,200 per fortnight for all eligible employees who, in the four weeks of pay periods before 1 March 2020, were working in the business or not-for-profit for 20 hours or more a week on average, and for eligible business participants who were actively engaged in the business for 20 hours or more per week on average in the month of February 2020; and
  • $750 per fortnight for other eligible employees and business participants.

From 4 January 2021 to 28 March 2021, the JobKeeper Payment rates will be:

  • $1,000 per fortnight for all eligible employees who, in the four weeks of pay periods before 1 March 2020, were working in the business or not-for-profit for 20 hours or more a week on average and for business participants who were actively engaged in the business for 20 hours or more per week on average in the month of February 2020; and
  • $650 per fortnight for other eligible employees and business participants.

Businesses and not-for-profits will be required to nominate which payment rate they are claiming for each of their eligible employees (or business participants).

Employee Eligibility

The eligibility rules for employees remain unchanged.

Reporting through STP

We are yet to receive confirmation on the reporting changes for the extension from the ATO.

B. Statutory Compliance Release Date: July 21, 2020

C. Effective Date: September 28, 2020

Deferment of TAP and SCP for six months from April, 2020

A. Update

The Ministry of Finance and Economy (MoFE) Brunei has announced the approval of interim measures to support certain private sectors in addressing the challenges arising from the spread of COVID-19 in the country.

A six-month deferment on Tabung Amanah Pekeraj (TAP) and Supplemental Contributory Pension (SCP) contributions is provided to private sector employees earning BND 1,500 and below in all sectors of the Micro, Small and Medium Enterprises (MSMEs) category with employees fewer than 100.

The interim measures will commence from April 01, 2020 and continue for six months.

B. Statutory Compliance Release Date: March 22, 2020

C. Effective Date: April 01, 2020

I. Tax exemptions and deductions for preventing and controlling current novel coronavirus outbreak

A. Update

In order to support the prevention and control of the current novel coronavirus (2019-nCoV) outbreak, the Ministry of Finance, General Administration of Customs and the State Taxation Administration have issued several circulars to grant tax exemptions.

The relevant circulars are as under:
  • Non-cash grants of medicine, medical products and preventive utensils provided by employers are not included in taxable income in computing individual income tax
  • Donations by individuals, through non-profit social organizations or people's governments, in cash or in kind for fighting the 2019-nCoV are fully deductible in computing individual income tax Circular [2020] No. 9 and No. 10 apply from Jan. 01, 2020 to an undefined date.

B. Statutory Compliance Release Date: February 06, 2020

C. Effective Date: January 01, 2020


II. Reduction in Social Security Contributions due to Corona Virus' adverse effects

A. Update

At a meeting of the State Council, it was announced that the government had decided to exempt enterprises from, or reduce on their behalf, three social security contributions, namely:

  • Old-age pension insurance,
  • Unemployment insurance and
  • Work-related injury insurance.

These measures are intended to mitigate the adverse effects of the outbreak of Coronavirus.

This unified reduction and exemption policies for all regions will be implemented from February. Also, the social security premiums collected in February can be refunded or offset against future contributions.

The exemption to contribute to the all the social security contributions by employers are as under:

  • For Hubei Province, 100% exemption is granted to all the enterprises from February to June 2020 for Pension, Unemployment Insurance, and Injury. While for medical Insurance, 50% exemption is given to all the enterprises from Feb to June 2020 but such exemption does not include maternity insurance.
  • For Shanghai Province/City, Medical Insurance changes from 9.50% to 9% from February to December 2020, while Maternity Insurance rate remains at 1%.
  • For all other Provinces (other than Hubei and Shanghai):
    • For Pension, Unemployment Insurance and Injury Insurance: 100% exemption is given to SMEs from
    • February to June 2020 and 50% exemption is given to other enterprises from February to April 2020;
    • For Medical Insurance: 50% exemption is given to all the enterprises from Feb. to June 2020 c. For Maternity Insurance: No change.

The above exemption shall be available from February 2020 to June 2020.

B. Statutory Compliance Release Date: February 18, 2020

C. Effective Date: February 1, 2020


III. Extension of exemption in Unemployment Insurance and Injury insurance contribution in Hubei Province

A. Update

For Hubei Province, 100% exemption for Unemployment Insurance and Injury insurance has got extended till April 2021 . Earlier, 100% exemption was granted to all the enterprises from February to June 2020 for Unemployment and Injury Insurance.

B. Statutory Compliance Release Date: May 12, 2020

C. Effective Date: July 01, 2020 till April 30, 2021


IV. Extension of the implementation period of the enterprise social insurance premium reduction policy

A. Update

The Ministry of Human Resource and Social Security has extended the period of exemption and reduction of employers' contributions for three social security insurances, i.e. employer's contribution to old-age pension insurance, unemployment insurance and work-related injury insurance, for all the provinces other than Hubei.

Under Public Notice [2020] No. 49 , the period of exemption of social security contributions for small and medium-sized enterprises will be extended to the end of December 2020 and the period of 50% reduction of social security contributions for large enterprises will be extended to the end of June 2020.

Also, many provinces can continue to implement the lower limit of the individual insurance payment base of 2019 as the lower limit in 2020. The upper limit of the individual insurance payment base will be adjusted normally according to the regulations.

B. Statutory Compliance Release Date: June 22, 2020

C. Effective Date: May 01, 2020 till December 31, 2020

I. Reduced GHS contributions for the months of April and June 2020

A. Update

As a result of the Covid-19 pandemic, the Cyprus Government decided on March 15, 2020, to apply the reduced GHS contributions for the months of April and May 2020.

However, following the vote by the House of Representatives on Mar. 27, 2020 of the Financial Support Program in response to the financial impact of the Coronation, it has been decided not to pay the increased contribution to the GSEY for a period of three months i.e., April to June 2020.

Contributor’s Category Up to 29th February 2020 For March 2020 1st April – 30th June 2020 1st July 2020 onwards
% % % %
Employees 1.7 2.65 1.7 2.65
Employers 1.85 2.9 1.85 2.9

Please find the below table which specifies the period of application of the relevant contribution rates:

B. Statutory Compliance Release Date: March 30, 2020

C. Effective Date: April 01, 2020


II. Special leave for Child Care

A. Update

Parents working in the private sector will be granted “Special Leave” to remain at home to care for children up to 15 years of age. Special Leave can last up to four weeks for a salary of up to €2,500:

  • 60% of the salary will be paid for the first €1,000 of the parent’s salary, and
  • For the next € 1,000 of the salary, a 40% allowance will be paid.

Special Leave is granted to one of the two parents, not both. For single-parent families, the rate of payment of the allowance is set at 70% and 50%, respectively.

B. Statutory Compliance Release Date: March 16, 2020

C. Effective Date: April 01, 2020

I. PM CARES Fund

A. Update

To provide relief to the Covid-19 affected, a public charitable trust in the name of ‘Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund’ (PM CARES Fund) has been set up. Donations to this fund will be exempted from the income tax under section 80G.

B. Statutory Compliance Release Date: March 28, 2020

C. Effective Date: April 01, 2019


II. Change in contribution to Statutory Provident Fund (EPF)

A. Update

Finance Minister announced additional relief measures to support Indian Economy’s fight against COVID-19. In order to provide more take home salary to employees and also to give relief to employers in payment of Provident Fund dues, statutory PF (EPF) contribution of both employer and employee will be reduced to 10% each from existing 12% each for all establishments covered by EPFO for next 3 months, i.e. June to August 2020.

Further to the above Press Release, a Notification has been released on May 18, 2020. As per this, the reduced rate of 10% of monthly pay (instead of 12% of monthly pay) applies for employer’s and employee’s EPF contribution in respect of wages payable for the months of May, June and July 2020.

The reduced rate for provident fund contributions will be applicable for International Workers also.

This notification is not applicable to:

  • Central Public Sector Enterprises, State Public Sector Enterprises and other establishments owned by or under the control of the Central Government or the State Government;
  • Establishments eligible for relief under the Pradhan Mantri Garib Kalyan Yojana (PMGKY) i.e. establishments with up to 100 employees with 90% or more of such employees earning monthly wages less than INR 15,000 – where both employer’s and employee’s share of Provident Fund contribution is payable by the Central Government.

B. Statutory Compliance Release Date: May 18, 2020

C. Effective Date: May 01, 2020


III. Extension of ESIC coverage pan-India

A. Update

Till now, ESI Scheme was notified in 566 Districts in 34 States and Union Territories, which include some fully notified while some partially notified districts. After Aatmanirbhar Bharat Abhiyaan Press Release-Part 2 , it has been provided that ESIC shall cover all districts and all establishments employing 10 or more employees in India. Extension of ESIC coverage to employees working in establishments with less than 10 employees shall be on voluntary basis.

B. Statutory Compliance Release Date: May 14, 2020

C. Effective Date: : May 14, 2020

I. Incentive on Article 21 of the Income Tax in response to Covid-19 pandemic

A. Update

The Indonesia Government via Regulation No 23/ PMK.03/ 2020 has announced an incentive of Article 21 on income tax, starting from April 2020 onwards. wherein the employer needs to payback the taxes withheld from the employee’s gross regular income. Employees who are entitled to receive this incentive should fulfil the following criteria:

  • Employees whose gross regular income for a year is not more than 200 million;
  • Employees who are working for companies in business of processing industry (Category C), the list can be found on page 16-25 of the regulation;
  • Employees who are working for companies which have been designated as KITE (Ease of imports for Export purposes);
  • Employees who are working for companies which have been designated as KITE (Ease of imports for Export purposes);
  • The incentive is only applicable for employees who have Tax ID number (NPWP).

The incentive of Article 21 is to be paid by the employer to the employee together with the tax home pay. The Article 21 income tax borne by the Govt. is not considered as taxable income for the employee. This incentive will be valid for 6 months.

This incentive will be applicable only for certain industries such as Chemicals and chemical goods industry, Motor vehicle, trailer, and semi-trailer industry, Food industry, Rubber, rubber goods, and plastic industry, Pharmaceutical, chemical and traditional medicine industry, Other transportation device industry, Non-metal excavated goods industry, Basic metal industry, Paper and paper goods industry, Electrical device industry, Ready-to-use clothing industry, Metal goods, non-machine and equipment industry, Textile industry, Beverage industry, Machine and equipment industry that is YTDL (Yang tidak dapat diklasifikasikan di tempat lain/”cannot be classified into other segment”), Computer, electronic devices, and optic industry, Printing and recording reproduction industry, Leather, leather goods, and footwear industry and Furniture industry etc.

B. Statutory Compliance Release Date: March 23, 2020

C. Effective Date: April 01, 2020 to September 30, 2020

II. Regulation 44/ PMK.03/ 2020 replaces Regulation 23/ PMK. 03/ 2020

A. Update

Considering the COVID–19 situation, on April 27, 2020 the Ministry of Finance (MoF) has decided to expand the tax incentive to other business sectors as well, including small and medium enterprises (SMEs). Accordingly, the MoF issued Regulation 44/ PMK. 03/ 2020 which replaced Regulation 23/ PMK.03/ 2020.

The new regulation brought the additional points provided below:

  • Extended the incentive from 440 business classification code (KLUs) to 1064.
  • Companies that have bonded zone (Kawasan Berikat) license can also apply for the incentive.
  • The realization report now needs to be submitted by the employers on monthly basis by 20th of the following month as compared to reporting required to be done every 3 months under Reg 23/ 2020.
  • Format of realization report has been amended to capture monthly data.

B. Statutory Compliance Release Date: April 27, 2020

C. Effective Date: April 01, 2020 to September 30, 2020


II. Regulation 86/ PMK.03/ 2020 replaces Regulation 44/ PMK. 03/ 2020

A. Update

The Indonesian Govt has replaced the Regulation 44/ PMK.03/2020 with regulation 86/ PMK. 03/ 2020 . The highlights of Regulation 86/ PMK. 03/ 2020 are as under:

  • The list of industries which can apply for the fiscal incentives is expanded from previously 1,062 business classification code (KLU) to 1,189 KLUs. Refer to the attached regulation page 26-50 for the list
  • The Government borne ‘Article 21 income tax’ was extended up to period December 2020
  • In the event that the Headquarter is included in the list KLU who can utilize the incentive Article 21, the realization report (both of Headquarter and Branch) will be reported only by the Headquarter
  • The realization report for Article 21 has undergone changes. A new section has been incorporated in the report to capture Kode billing and Jumlah.

B. Statutory Compliance Release Date: July 16, 2020

C. Effective Date: April 01, 2020 to December 31, 2020

I. Reduced Pension contributions for the period extending from March to May 2020

A. Update

As a result of the COVID-19 pandemic, the Jordan Government has provided an option for employers to apply the reduced pension contributions rates for the months from March to May 2020.

Please find the below table which specifies the period of application of the relevant contribution rates:

Contributor’s Category Up to 29th February 2020 01st Mar 2020 to 1st June 2020 onwards
31st May 2020
% % %
Employees 7.5 1 7.5
Employers 14.25 4.25 14.25

Please note that it is optional for companies to apply reduced rates on all or certain employees.

B. Statutory Compliance Release Date: March 19, 2020

C. Effective Date: March 01, 2020


II. Protection Scheme for Private entities in Tourism and Transport Sector

A. Update

The Prime Minister, Jordan has recently issued Defense Order No. 14. The order is the protection scheme targeting private entities in the tourism and transport sectors who have been affected by the COVID-19. In order to avail the protection scheme, private entities need to apply to the social security corporation and obtain their approval.

The contribution to be made by the employer as per the applicable limit is 21.75% i.e. (7.5% as of the employee contribution and 14.25% as employer contribution).

As per the instructions issued in new Defense order, employer will not stop the applicable Social security deduction during the benefit of the defense order. However, a new program “Economic Empowerment 1“ has been issued in this regard, and accordingly the private entity may apply to the Social Security Corporation to reduce contributions rates to be as follows (Total contribution of 13.5%: 4.25% as of the employee share, 9.25% as of the employer share).

In addition to above, the scheme provides to allocate 50% (20% as employer share and 30% as social security office share) of ‘subject salary’ for their registered employee covered in the month of June 2020. The maximum and minimum contribution shall be 400 JOD and 220 JOD respectively.

B. Statutory Compliance Release Date: July 02, 2020

C. Effective Date: June 01, 2020 to December 31, 2020


III. Protection Scheme for Private entities

A. Update

The Prime Minister, Jordan has recently issued Defense Order No. 14. The order is the protection scheme targeting private entities in the tourism and transport sectors and other entities designated as highly affected by the COVID-19 crisis (determined by the social security) who have been affected by the COVID-19. In order to avail the protection scheme, private entities need to apply to the social security corporation and obtain their approval.

The contribution to be made by the employer as per the applicable limit is 21.75% i.e. (7.5% as of the employee contribution and 14.25% as employer contribution).

As per the instructions issued in new Defense order, employer will not stop the applicable Social security deduction during the benefit of the defense order. However, a new program “Economic Empowerment 1“ has been issued in this regard, and accordingly the private entity may apply to the Social Security Corporation to reduce contributions rates to be as follows (Total contribution of 13.5%: 4.25% as of the employee share, 9.25% as of the employer share).

In addition to above, the scheme provides to allocate 50% (20% as employer share and 30% as social security office share) of ‘subject salary’ for their registered employee covered in the month of June 2020. The maximum and minimum contribution shall be 400 JOD and 220 JOD respectively.

B. Statutory Compliance Release Date: July 02, 2020

C. Effective Date: June 01, 2020 to December 31, 2020

Minimum Calculation Index (MCI)

A. Update

From April 01, 2020; the minimum calculation index (MCI) in Kazakhstan for 2020 is increased to KZT 2,778. MCI for January 01, 2020 to March 31, 2020 was KZT 2,651).

The increase of MCI will impact the calculation of the maximum thresholds for tax deductions and exemptions, which are based on MCI. The caps of payroll taxes and social payments (i.e. PIT, OPFC, OPPFC, OSMI payments, OSMI contributions, Social tax and Social contributions) are not MCI-based. Hence, the maximum limits of payroll taxes and social payments are not changed.

B. Statutory Compliance Release Date: N.A

C. Effective Date: April 01, 2020


Impact of Correction co-efficient on Social tax and social security contributions and payments

A. Update

On April 21, 2020, the Government of Kazakhstan unveiled response package to limit the impact of COVID-19 pandemic on the economy. The details are summarized below:

  • The correction coefficient “0” is established to the rates of the following social security contributions / payments:
    • Social tax, Obligatory pension fund contributions, Obligatory professional pension fund contributions, Social insurance contributions, Obligatory social medical insurance payments and contributions, except for the ones paid by sole proprietors for themselves.
  • The above correction coefficient is applicable to the following entities and within the period specified below:
    • Individuals engaged into private practice and subjects of micro, small and medium enterprises, which carry out activities, as prescribed, for the above-mentioned contributions / payment deadline falling in the period April 01, 2020 - October 01, 2020.
    • Subjects of large enterprises, which carry out activities, as prescribed, for the above-mentioned contributions / payment deadline falling in the period April 01, 2020 - July 01, 2020.
  • Whereas large enterprises with specified types of activities are not liable to pay for the above-mentioned contributions / payment deadline for the period April 01, 2020 to July 01, 2020.

B. Statutory Compliance Release Date: April 21, 2020

C. Effective Date: April 01, 2020 to September 30, 2020

Postponement of National Social Security Contribution

A. Update

The Ministry of labor has extended the deadlines for submitting the National Social Security Fund (NSSF) contributions related to the first half of the year 2020 for six months (i.e. For January whose deadline is in February has been extended till July 2020) in addition to extending the deadline for the annual NSSF declaration of the year 2019 till September 30, 2020.

Further please find below some details for better clarity:

  • The deferral of NSSF contribution is related to only remittance and declaration (reporting).
  • There is no impact on calculation and deduction of NSSF contribution from salary of the employee. Also, there is no impact on calculation of Income Tax.
  • The due dates for remittance and reporting has been changed to the end of sixth month. For instance, end of July for Jan contribution, end of Aug for Feb contribution, end of Sep for March contribution and likewise for other months.
  • There is no change in reports of NSSF. The reporting is as usual with the change in due dates for remittance and filing.

B. Statutory Compliance Release Date: April 08, 2020

C. Effective Date: January 01, 2020

I. Exemption from Human Resources Development Fund levy

A. Update

On 26 March 2020, in order to ease the financial burden faced by employers due to the effects of Coronavirus (COVID-19), the Honorable Human Resources Minister of Malaysia announced that employers categorized within all 63 sub-sectors, stipulated under the sectors of Manufacturing, Services Sector and Mining and Quarrying Sector, affected by the Coronavirus (COVID-19) pandemic will be exempted from paying the human resources development levy for a period of 6 months effective from April 2020 to September 2020 .

Accordingly, Employers are exempted from paying levy for the months of March 2020 to August 2020

B. Statutory Compliance Release Date: March 26, 2020

C. Effective Date: April 01, 2020


II. EPF contribution rate change from April 01, 2020 to Dec. 31, 2020

A. Update

Further to earlier update in the last release on reduction of EPF contribution rate change, the Inland Revenue Board has now notified the revised EPF contribution rate table.

B. Statutory Compliance Release Date: Mar. 30, 2020

C. Effective Date: FY 2020


III. Short term recovery plan announced

A. Update

In light of the ongoing Covid 19 pandemic, the Malaysian Government has announced fourth economic relief package named ‘PENJANA’ to reopen the economy.

  • Employees who received benefits-in-kind in the form of mobile phones, laptop or tablet from the employer for the purpose of working from home will be entitled to an income tax exemption of up to MYR 5,000
  • Special individual income tax relief of up to RM2,500 on the purchase of handphone, notebook & tablet
  • Individuals who incur childcare expenses will be entitled to a personal relief of MYR 3,000.
  • The domestic tourism relief of MYR 1,000 will be extended to year of assessment 2021 i.e. from March 1, 2020 till Dec 31, 2021

The above amendments are still in proposal stage. We shall analyse further details once the same is passed in a Gazette.

B. Statutory Compliance Release Date: June 5, 2020

C. Effective Date:

  • Tax exemptions for BIK: July 1, 2020
  • Special individual income tax relief: June 1, 2020
  • Domestic tourism: March 1, 2020

I. No SSF Contribution

A. Update

As per a recent notice by the Ministry of Finance, the entire contribution of 31% to SSF to be made by employees as well as employer for the month of Chaitra 2076 (Mar. 14, 2020 to Apr. 12, 2020) will be deposited by Government of Nepal.

B. Statutory Compliance Release Date: March 28, 2020

C. Effective Date: March 14, 2020


II. Donation to Covid Relief Fund

A. Update

Deduction for contribution to Covid Relief Fund is available for the amount deposited in Central Government Fund or State Government Fund. This donation should be allowed deduction without any limit (same as under section 12(Kha) which says any contribution made by a person during an income year in Prime Minister Relief Fund and National Reconstruction fund can be deducted while calculating taxable income for the income year of the person.

B. Statutory Compliance Release Date: April 04, 2020

C. Effective Date: FY 2076/77

COVID 19 – Wage Subsidy

A. Update

Following are the highlights of the wage subsidy for COVID 19:

Eligibility
  • All New Zealand employers who have been adversely affected by COVID-19 shall be eligible provided they qualify the below criteria:
    • Business is registered and operating in New Zealand
    • Employees are legally working in New Zealand, including employees who:
      • have an NZ work visa
      • have a condition on their NZ temporary visa that allows them to work in NZ
      • are international students whose visa allows them to work in NZ
  • Business has experienced a minimum 30% decline, as per method prescribed by the authorities, and that decline should be related to COVID-19
  • c. Business has taken active steps to mitigate the impact of COVID-19.
Application process
  • Employer to apply for subsidy for employees by providing information as required by the IRD as provided on below link15.
  • Must retain the employees named in your application for the period of the subsidy.
Amount of Subsidy
  • The COVID-19 Wage Subsidy will be paid at a flat rate of:
    • $585.80 for people working 20 hours or more per week (full-time rate)
    • $350.00 for people working less than 20 hours per week (part-time rate).
    • The subsidy is paid as a lump sum and covers 12 weeks per employee.
    • If you work variable hours (or your employee does), you can use an average to work out what rate to apply for..
      • Use the average hours worked each week:
        • over the last 12 months, or
        • over the period you (or they) have been employed (if it's less than 12 months).
      • If the average hours are:
        • 20 or more, apply for the full-time rate
        • Less than 20, apply for the part-time rate.
Payment to Employees
  • Employers receiving the wage subsidy should pay to such employees, named in the application, at least 80% of their usual wages or at least the subsidy rate (i.e. full-time or part-time).
  • If your employee's usual wages are less than the subsidy, then usual wages to be paid to them.
Impact on Employees’ PAYE
  • Your employee will need to pay tax on their wage subsidy payment as it’s paid to them as part of their normal wages. This means it’s subject to the usual employer deductions, e.g., PAYE, Student Loan, KiwiSaver, Child Support etc.
  • When calculating PAYE deductions, do not gross up the Wage Subsidy component. PAYE is deducted from the subsidy (i.e. $585.50 less PAYE, etc.).
  • You can agree with your employee the frequency at which the subsidy is paid. However, if the subsidy is being paid outside of their usual pay cycle this might have adverse tax implications for your employees such as:
    • they may be taxed at the wrong rate
    • it may impact the Working for Families entitlements.
Leave updates for COVID 19:

Leave payment is applicable for employee who need to self-isolate, cannot work as they are sick from COVID 19 or are caring for their dependents who are either self-isolated or are sick from COVID 19.

An employer will be eligible to get the COVID-19 Leave Payment. However. post 27 March, the authorities are not accepting any further applications.

B. Statutory Compliance Release Date: March 17, 2020

C. Effective Date: March 17, 2020

I. Moratorium on short term loan payments of SSS members affected by COVID-19 situation

A. Update

Due to the strict community quarantine to manage the COVID-19 situation Social Security Commission has issued a circular for releasing guidelines on Moratorium on Short-term Loans.

Coverage of Circular

Members with Salary Loan, Calamity Loan, Emergency Loan, Restructured Loan under the Loan Restructuring Program (LRP) and Educational Assistance Loan (EAL) in the entire Philippines are covered by circular.

A moratorium will be applicable from February to April 2020, without interest and penalties. According to circular for employed member-borrowers, the employer will immediately cause the temporary stoppage of salary deduction upon the effectivity of this circular. And employer, without notice of SSS, will resume loan deduction after the end of the moratorium period.

However, any remittance made during the moratorium period will be applied to the outstanding balance of the loan following the order of priority in the application of payments.

Eligibility
  • Members must be residents of Philippines.
  • The Salary Loan, Calamity Loan, Emergency Loan must be granted from January 01, 2018, to March 16, 2020
  • The Loan Restructuring Program (LRP) and Educational Assistance Loan (EAL) must be currently amortizing means the last amortization month is not earlier than February 2020.
  • Members must have not been granted any final benefit.

B. Statutory Compliance Release Date: March 31, 2020

C. Effective Date: February 01, 2020 to April 30, 2020


II. Pag-IBIG fund offers three-month moratorium on all loans

A. Update

Pag-IBIG is offering a three-month moratorium to its member-borrowers to help defray their expenses during the enhanced community quarantine being implemented by the government in its fight to contain COVID-19 virus.

Housing loan, Multi-purpose Loan, and Calamity Loan borrowers with payments due on March 16, 2020, until June 15, 2020, are eligible to apply for the moratorium. Presently, only those residing in Luzon and the National Capital Region can avail of the offer.

Pag-IBIG Fund has started receiving application in the region Metro Manila as well as the rest of the island of Luzon of the Philippines. Members may submit their application at the nearest Pag-IBIG fund branch or shall apply online on the Pag-IBIG website (https://www.pagibigfund.gov.ph/index.html) and click the “Virtual Pag-IBIG” under the e-services until June 15, 2020.

Post the submission, employees will get a reference number of the application which needs to be provided to the employer. Post 7-20 days approval will also be shared by Pag-IBIG which also needs to be shared with the employer.

In case the employer has made any remittance during the moratorium period, it shall be considered as an advance payment for the month of July 2020.

B. Statutory Compliance Release Date: March 18, 2020

C. Effective Date: March 16, 2020 to June 15, 2020

Expansion of the employment tax incentive age eligibility criteria and amount claimable

A. Update

The government proposes expanding the ETI program for a limited period of 4 months, beginning April 01, 2020, and ending on July 31, 2020, as follows :

Coverage of Circular
  • Increasing the maximum amount of ETI claimable during this 4-month period for employees eligible under the current ETI Act from R1,000 to R1,750 in the first qualifying 12 months and from R500 to R1,250 in the second 12 qualifying months.
  • Allowing a monthly ETI claim in the amount of R750 during these 4 months for employees from the ages of 18 to 29 who are no longer eligible for the ETI as the employer has claimed ETI in respect of those employees for 24 months; and 30 to 65 who are not eligible for the ETI due to their age.
  • Members must have not been granted any final benefit.

B. Statutory Compliance Release Date: April 25, 2020

C. Effective Date: April 01, 2020, to July 31, 2020


Skills development levy holiday

A. Update

There will be a four-month holiday for skills development levy contributions (1% of total salaries) to assist all businesses with cash flow . This means that there will be no SDL contribution till Sept. 30, 2020.

B. Statutory Compliance Release Date: April 25, 2020

C. Effective Date: May 01, 2020


Adjust PAYE for donations made through the Employer to the Solidarity Fund

A. Update

Where employers contribute to the Solidarity Fund on their employees’ behalf, Government is proposing a special relief measure by temporarily increasing the current 5% tax limit in the calculation of monthly PAYE of the employee. An additional limit of up to a maximum of 33.3% for three months or 16.66% for six months, depending on an employee’s circumstances, will be available.

This will ensure that the employee gets the deduction that is in excess of 5% much earlier than under normal circumstances, and will therefore not have to wait until final assessment to claim a potential refund, provided the donation is made to the Solidarity Fund. It is, however, important to note that a final determination must still be made upon assessment as the employee may have other income, deductions or losses that impact the final taxable income before the deduction of donations.

The proposed amendments are deemed to apply until September 30, 2020.

B. Statutory Compliance Release Date: April 25, 2020

C. Effective Date: April 01, 2020

I. Temporary increased tax deduction granted

A. Update

A press release was issued by Korean Ministry of Economy and Finance on the Comprehensive Measures to be taken for local economy for minimizing the ripple effects and early overcoming of COVID-19.

As per it, for individuals, who are eligible for credit card deduction, a temporary increased tax deduction is granted for the usage for the period from March to June 2020.

Credit card deduction rate increases from 15% to 30%, debit card/cash receipt rate increases from 30% to 60%. Moreover, additional deduction for the expenditure used in traditional market and public transportation increases from 40% to 80%. Additional deduction remains limited to KRW 1M for traditional market and public transportation, respectively. Credit card deduction limit in total remains the same.

B. Statutory Compliance Release Date: February 28, 2020

C. Effective Date: March 1, 2020


II. Covid19: Reduction in Health Insurance Premium

A. Update

A Guide has been released by National Health Insurance Authority (NHIA) on Reduction in Health Insurance due to Covid-19.

The reductions are as under:

  • Area: Special Disaster Area (Daegu, Kyungsan, Cheongdo, Bonghwa)
    • Health Insurance Premium Amount: Not exceeding 86,920KRW
    • Reduction rate: 50%
    • Period: March to May 2020
  • Area: Other Areas
    • Health Insurance Premium Amount: Not exceeding 58,360KRW
    • Reduction rate: 50%
    • Period: March to May 2020
  • Area: Other Areas
    • Health Insurance Premium Amount: Exceeds 58,360KRW but does not exceed 74,210KRW
    • Reduction rate: 30%
    • Period: March to May 2020

The above update implies that for an employee who’s monthly NHI premium does not exceed 86,920 KRW and whose working place is in special disaster area, 50% of his/her monthly NHI premium will be reduced; likewise for others.

Since, this amendment is effective from March 2020, the retrospective adjustment should be made in April month.

B. Statutory Compliance Release Date: April 13, 2020

C. Effective Date: March 01, 2020


III. Proposed Increase in the credit card ceiling limits

A. Update

The Ministry of Economy and Finance (MOEF) released a package of tax reform proposals for 2020 to support the Korean economy and individuals to cope with hardships during the COVID 19 pandemic. As a part of the same package, for the year-end settlement to be done from January 01, 2021 (for the income earned during tax year 2020), the cap on basic deduction depending on earned income level has been proposed to be increased by KRW 0.3 million. Accordingly, the ceiling limits for basic deduction for credit card usage would be as under:

Earned Income

Cap

For YEA in 2021
(for income earned in 2020)

For YEA in 2022
(for income earned in 2021)

KRW 70 million and Less

KRW 3.3 million

KRW 3 million

KRW 70 million ~ 120 million

KRW 2.8 million

KRW 2.5 million

In Excess of KRW 120million

KRW 2.3 million

KRW 2 million

 

B. Statutory Compliance Release Date: July 22, 2020

C. Effective Date: January 01, 2020 (for year-end adjustment to be done in 2021)

COVID 19 Health Care and Social Security Fund

A. Update

Donation to COVID-19 Health Care and Social Security Fund that has been established to strengthen the mitigation activities aimed at controlling the spread of COVID-19 virus in the country and related social welfare program have been exempted from taxes.

B. Statutory Compliance Release Date: March 27, 2020

C. Effective Date: March 01, 2020

I. Reduction in Social security contribution rates

A. Update

As a result of the COVID19 pandemic, the Thailand Government has offered a reduction in rates of SSO contribution. However, it is not officially announced that the reduced rates can be implemented by employers.

According to news on the official site, the contribution rates are effective from March to May 2020 and the proposed rates of contribution are as follows:

Employee SSO contribution rate is 1% (previously 5%) and employer SSO contribution rate is 4% (previously 5%).

B. Statutory Compliance Release Date: April 03, 2020

C. Effective Date: March 01, 2020


II. Increment in the exemption amount of Health Insurance Premium

A. Update

As a result of the Covid19 pandemic, the Thailand Government has announced an increment in the exemption amount of Health insurance premium paid by employee.

As per the Ministerial regulation No. 365 the health insurance premium deduction is increased to 25000 THB from 15000 THB. This regulation is effective from January 01, 2020. The existing limitation is still in existence i.e. adding up this deduction with Life Insurance Premiums paid, the amount must not exceed 100,000 Baht.

B. Statutory Compliance Release Date: June 26, 2020

C. Effective Date: January 01, 2020


III. New Tax Deduction Allowance for 2020

A. Update

The Revenue Department has passed a Royal Gazette wherein a new tax deduction (as Tax Allowance) has been introduced on the amount invested by the employee in Super Saving Fund (SSF) Extra during the year 2020.

In the Ministerial Regulation, they have defined some conditions and procedures to avail the benefit of newly introduced tax deduction which are as follows:

  • Super Saving Fund Extra is separate from regular SSF deduction.
  • The deduction is available for investment made during April 01, 2020 to June 30, 2020.
  • The maximum tax deduction is 200,000 Baht.
  • SSF Extra tax deduction shall be over and above the maximum deduction limit of 500,000 Baht.
  • The investments in SSF Extra should be held by employees for at least 10 years from the date of first purchase.
  • The above deduction shall be provided only if the employees have invested in a fund whose 65% of net assets are invested in Security Exchange of Thailand-listed securities.

B. Statutory Compliance Release Date: May 27, 2020

C. Effective Date: January 01, 2020


IV. New Tax exemption for e-Donation to Office of Permanent Secretary

A. Update

The Ministry of Finance has issued a Royal Decree No. 701 wherein a new tax exemption has been introduced for the donation made through electronic donation system to the Office of Permanent Secretary, the Prime Minister’s Office for supporting the resolution of the Coronavirus Infection 2019. The tax exemption is available for the donation made during the period March 05, 2020 to March 05, 2021.

This exemption will be included in the standard deduction of Donation, and accordingly the deduction amount shall be the actual amount of donation made not exceeding 10% of Net Assessable Income.

B. Statutory Compliance Release Date: July 02, 2020

C. Effective Date: March 05, 2020 to March 05, 2021


V. Tax Exemption on Special Compensation received from Ministry of Public Health

A. Update

The Ministry of Finance has issued Ministerial Regulation No. 366/2020 implementing the tax exemption in a bid to boost the morale of the healthcare workers dealing with the COVID-19 outbreak in the country. Accordingly, the government will grant tax exemption to certain individuals, including Medical and Health care professionals, who receive special compensation from the Ministry of Public Health (MOPH) for the year of assessment 2020. The special compensation refers to the compensation paid by the MOPH, as approved by the Ministry of Finance (MOF) to the:

1. Healthcare professionals for their work performed in dealing with the COVID-19 pandemic, including diagnosing, investigating, treating, and preventing the spread of the said pandemic; and

2. Other officials and third parties providing COVID-19-related medical and public health consultations.

B. Statutory Compliance Release Date: July 02, 2020

C. Effective Date: January 01, 2020


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