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KEY FEATURES
The current release includes several new features which enhance the functionality of Equus Tax Engine.
Calculation Detail Report
Social wage column has been added to the grossup and allowances details sections of the calculation report for 30 key countries. This is especially useful for Cost Estimates where the Automatic Social Tax feature calculates home country social security, but Tax Resident? is set to No to omit home actual income taxes.
See Appendix A for countries with “enhanced details”. More countries will be upgraded in upcoming releases.
Enhanced Income and Social Tax
Added the income and social tax details to two more countries, Colombia and South Korea. These additional pages, or “enhanced details”, are now available in the Cost Estimate and Compensation Calculation Detail for 30 key countries.
In the Social Tax Details, the base amounts can be traced to the total value in the new social wage column of the Grossup Details. Components making up the total can also be traced to other areas of the report.
Features
The following features were added to 30 key countries with enhanced details, as denoted in Appendix A.
Social Wage Base Details
Added social wage columns to the grossup and allowance sections of the Cost Estimate Calculation Details to show components of the base used to calculate social security contributions.
Home Country Allowances Details
Updated the Taxable Amount column of the allowances section of the calculation details to when Tax Resident? is set to No.
Country Updates
Argentina
Income Tax:
Made the following changes, effective January 1, 2021:
Added a deduction for employee voluntary pension contributions for outbound assignments, capped at ARS 24,000.
Increased the earned income deduction by ARS 995,144 to ARS 1.8 million.
Updated the basic, dependent, and earned income deductions to prorate in partial years for inbound assignments.
Australia
Social Security: Increased the superannuation wage ceiling by AUD 7,320 to AUD 235,680, effective July 1, 2021.
Bangladesh
Income Tax: Corrected the tax table, effective July 1, 2020. The new top rate of 25% applies to income above BDT 1.6 million. Previously, the top rate of 30% applied to income above BDT 3 million, resulting in a tax overstatement.
Brazil
Income Tax: Corrected the following:
Maximum pension deduction to use 12% of gross income. Previously, the maximum was calculated using 12% of taxable income, resulting in a potential tax overstatement.
Pretax Medical and Dental to be treated as an itemized deduction. Previously, this contribution was deducted at the line-item level, resulting in a tax understatement when itemized deductions are less than the standard deduction.
Chile
Social Security: Increased the disability and life contribution rate by 0.5% to 2%, effective July 1, 2020.
China
Income Tax: Updated the inbound calculation from a nontreaty country to exempt income when duration is three months or less and Qualifies for Short Term Exemption. Previously, income was exempt when duration was under three months.
Colombia
Income Tax & Social Security: Enhanced the calculation report by adding the income tax table and social security contribution details.
Germany
Income Tax: Corrected the following when Calculate Child Deductions? is set to Automatic or Automatic and add child benefits. Amounts shown apply to single employees:
Child benefit repaid for employees with more than one dependent. The previous calculation resulted in a maximum tax understatement of EUR 3,978.
Income threshold for employees with more than four dependents at which the child deduction calculates and, if selected, child benefits are repaid. Previously, the threshold was overstated by EUR 4,000.
Indonesia
Social Security: Decreased the pension wage ceiling by IDR 2.2 million to IDR 105 million, effective March 1, 2021.
Japan
Income Tax: Corrected the 45% bracket tax amount displayed on the income tax details report when income exceeds JPY 1 billion.
Norway
Income Tax: Updated the double tax relief method for assignments to the following countries:
Bulgaria - changed from exemption to foreign tax credit.
Serbia - added as foreign tax credit.
Croatia and Tunisia - added as exemption with progression.
Poland
Social Security: Updated the wage base to exclude employer voluntary pension contributions for outbound assignments.
South Korea
Income Tax & Social Security: Enhanced the calculation report by adding the income tax table and social security contribution details.
Switzerland
Income Tax:
Extended the Exclude General Employment Deduction? input to apply for cantonal tax calculations.
Added the expat concession of CHF 18,000 to tax at source calculations for Geneva, Neuchatel, and Vaud. The deduction applies for host calculations if Qualifies as International Employee? is set to
Neuchatel
Income Tax: Added the general employment deduction, which is the lesser of 3% of income and CHF 4,000.
Trinidad and Tobago
Income Tax: Increased the personal allowance by TTD 12,000 to TTD 84,000, effective January 1, 2021.
United States
Income Tax: Corrected the home tax grossup for assignments from California, Minnesota, and New York to prorate hypothetical state tax in partial years when actual state tax is not calculated. Previously, the annual amount was used, resulting in a tax understatement.
Utah
Income Tax: Increased the following, effective January 1, 2021:
Dependent exemption by USD 1,160 to USD 1,750.
Tax credit phaseout thresholds. The threshold increased by USD 216 to USD 15,095 for single employees.
Venezuela
Social Security: Increased the monthly minimum salary to VES 1.8 million, effective March 1, 2021, which increased the following wage ceilings. All amounts are shown in millions:
Social security by VES 100.8 to VES 117.
Unemployment insurance by VES 201.5 to VES 234.
Other Country Changes
Corrected the host tax grossup to include the prorated home social tax in partial years when the employee is not resident in the home country. Previously, the annual amount was used, resulting in a potential tax overstatement. This change was made to 42 countries denoted with † in Appendix A.
Income Tax Treaties
Added the following income tax treaties which were omitted when Tunisia was added in v.20.4:
Treaty Countries
|
Effective Date
|
Germany – Tunisia
|
Jan 1, 2020
|
Ivory Coast – Tunisia
|
Jan 1, 2016
|
Saudi Arabia – Tunisia
|
Jan 1, 2014
|
Singapore – Tunisia
|
Jan 1, 2020
|
Appendix A – 154 Supported Authorities
