Key Feature
European Frontier Workers
Use the new Home Work Tax Estimator to calculate social security for frontier workers who commute across national borders to work. The Home Tax Estimator calculates income tax in the country where these workers reside.
Thirteen countries have frontier tax treaties with their neighbors allowing for this cross-border income and social tax arrangement.
Use the tax engine to deliver compensation calculations and cost estimates of frontier workers on outbound assignments.
Update existing templates to include support of your frontier population with a few configuration changes.
Calculations will automatically include the work country’s social security contributions if the assignment has a frontier location.
If a frontier location is not entered, both income and social tax will be calculated for the country selected in the Home Tax Estimator.
Feature
European Frontier Workers
Added the Home Work tax estimator to calculate income and social tax for resident and work country, respectively, for outbound assignments. This second home tax estimator is available for the following countries with frontier tax treaties with their neighbors: Austria, Belgium, Denmark, Finland, France, Germany, Italy, Netherlands, Norway, Portugal, Spain, Sweden, and Switzerland.
To use this feature in compensation calculations, update your template as follows:
Within Tax Estimator Availability, add “Home Work” for Country and State/Province.
Within the Hypothetical Social Tax line item, replace Expat4Cast Hypo: Social with Frontier Hypo: Social.
To use this feature in equalized cost estimates, update your template as follows:
Within Tax Estimator Availability, add “Home Work” for Country and State/Province.
Within the Hypothetical Social Tax line item, change from Tax Calculation to Compensation using Frontier Hypo: Social.
Within the Home Social Tax line item, change from Tax Calculation to Compensation using Frontier Actual: Social.
New frontier location fields are available at the Assignment and Authorization level to track these workers. Note: the new fields are hidden by default; reach out to your Equus representative to enable them.
Compensation calculations and cost estimates created using these updated templates will output the home work country’s social security contributions if the assignment record includes a frontier work location. If a frontier location is not selected, only one home country tax estimator appears and it will be used to calculate income and social tax, as applicable.
If social security contributions are an eligible deduction for income tax in the home country, the home work country’s contribution will be used.
For cost estimates, the work country’s employer social security and payroll tax will automatically output for assignments with frontier locations. Additionally, if Automatic Social Tax is selected, the work country’s social security will be calculated if an agreement is available between the work and host country.
When a template is configured using the Frontier Hypo/Actual: Social feature, the applicable social tax calculation details are displayed on the Cost Estimate Line Item Frontier Calculation Detail report. Select the relevant line item name from the lookup.
Updates
Updates include calculation and rate changes to reflect current tax law resulting from inflation adjustments, legislative changes, and review of supported authorities. Effective dates indicate when the changes enter into force. Amounts are annual unless stated otherwise.
Algeria
Income Tax: Increased the following, effective January 1, 2022:
The four-bracket tax table to six by adding brackets of 27% and 33% with thresholds of DZD 480,000 and DZD 1.9 million, respectively.
The 20% bracket rate to 23%. The threshold increased by DZD 120,000 to DZD 240,000.
Bracket thresholds. The threshold for the 35% top bracket increased by DZD 2.4 million to DZD 3.8 million.
Argentina
Social Security: Increased the employee wage ceiling by ARS 954,512 to ARS 4.6 million, effective March 1, 2022.
Belgium
Income Tax: Replaced the expatriate tax regime calculation for inbound assignments with rules effective January 1, 2022. Changes include:
Replaced the Executive or Director lookup option with Yes for the Qualifies for Expatriate Tax Regime? input to represent employees other than researchers.
Income test for employees other than researchers. The exclusion will calculate if base compensation exceeds EUR 75,000.
Maximum deduction of the lower of 30% of gross income and EUR 90,000 of recurring allowances.
Taxable treatment of the following line items:
EE and Family Pre-assignment Medical Exam
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Reimbursement of Loss on Sale of Home
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Repatriation Home Purchase Costs
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Passport and Work Permit
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Loss on Sale of Household Goods
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Payment of Home Sale Closing Costs
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EE Language and Cultural Training
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Loss on Sale of Auto
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Payment of Home Sale Closing Costs
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Home country storage
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Relocation Allowance
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Transportation for College
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International Mobility Allowance
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Departure/Destination Services
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Education Allowance
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Brazil
Social Security: Increased the employee contribution bracket thresholds, effective January 1, 2022. The 14% top bracket applies to income between BRL 43,692 and BRL 85,047.
Bulgaria
Social Security: Increased the wage ceiling by BGN 4,800 to BGN 40,800, effective April 1, 2022.
Ecuador
Income Tax: Removed the foreign income exemption from the outbound actual calculation to reflect the change from a territorial to a worldwide basis, effective January 1, 2022. A credit for foreign tax paid was added to provide double taxation relief.
El Salvador
Social Security: Increased the pension contribution wage ceiling by USD 6,262 to USD 84,541, effective January 1, 2022.
Indonesia
Income Tax: Corrected benefits in kind to be taxable, effective January 1, 2022. Benefits in kind are defined as amounts paid to the vendor directly by the employer or reimbursed to the employee, and include costs such as tax benefits, housing, and moving to and from the host country.
Social Security: Increased the pension wage ceiling by IDR 3.9 million to IDR 109 million, effective March 1, 2022.
Israel
Income Tax: Increased the following, effective January 1, 2022:
Tax bracket thresholds. The threshold for the 50% top bracket increased by ILS 15,600 to ILS 663,240.
Credit point value by ILS 60 to ILS 2,676.
Italy
Social Security: Increased the wage ceiling by EUR 1,959 to EUR 105,014 for employees enrolled after January 1, 1996, effective January 1, 2022.
Ivory Coast
Income Tax: Changed Auto Lease Host Country to taxable unless duration is 12 months or less and assignment type is Short Term with Deductions.
Japan
Income Tax: Added the employment income deduction of JPY 150,000 for employees with dependents if income threshold is met.
Social Security: Changed the employer unemployment insurance contribution to use the general business rate of 0.6%. Previously, this estimator used the construction rate of 0.8%.
Morocco
Income Tax: Changed Auto Lease Host Country and Employer Provided Driver Host Country to taxable unless duration is 12 months or less and assignment type is Short Term with Deductions.
New Zealand
Income Tax: Increased the ACC Earners Levy rate and wage ceiling by 0.07% to 1.46% and NZD 5,633 to NZD 136,544, respectively, effective April 1, 2022.
Panama
Income Tax: Changed Primary or Secondary School Costs Host Country to taxable.
Poland
Income Tax: Added the Qualify for Inbound Exemption? input. When set to Yes, a maximum of PLN 85,528 is exempt per year for up to four years starting in 2022.
Serbia
Income Tax:
Corrected the base for resident tax. Previously, the base excluded the deduction for wage tax, resulting in an overstatement of tax.
Increased the average annual salary by RSD 93,600 to RSD 1,089,408, effective January 1, 2022, which increased the following:
Resident tax bracket thresholds. The threshold for the 15% top bracket increased by RSD 561,600 to RSD 6.5 million.
Personal deduction by RSD 37,440 to RSD 435,763 and spouse and dependent deductions by RSD 14,040 to RSD 163,411.
Social Security: Decreased the employer pension and disability contribution rate by 0.5% to 11%, effective January 1, 2022.
Singapore
Social Security: Increased the Central Provident Fund contribution rates, effective January 1, 2022. The employee and employer contribution rates for employees aged over 55 increased by 1%, except for the employer contribution rate for age 66 and over, which increased by 0.5%. The employee and employer contribution rates for employees 55 and under remain 17% and 20%, respectively.
Slovakia
Income Tax: Corrected the inbound nonresident calculation to omit the spouse allowance and child tax bonus credit. The previous calculation resulted in a maximum tax understatement of EUR 870 for married employees with income below EUR 38,553 and an additional EUR 133 per dependent.
South Africa
Income Tax: Increased the following, effective March 1, 2022:
Tax bracket thresholds. The threshold for the 45% top bracket increased by ZAR 75,000 to ZAR 1.7 million.
Primary rebate by ZAR 711 to ZAR 16,425.
Switzerland
Zurich
Income Tax: Decreased the cantonal coefficient by 1% to 99%, effective January 1, 2022.
Taiwan
Income Tax: Increased the following, effective January 1, 2022:
Tax bracket thresholds. The threshold for the 40% top bracket increased by TWD 190,000 to TWD 4.7 million.
Salary deduction by TWD 7,000 to TWD 207,000.
Standard deductions. The deduction increased by TWD 4,000 to TWD 124,000 for single taxpayers. The deduction is doubled for married taxpayers.
Personal exemption by TWD 4,000 to TWD 92,000.
United Kingdom
Increased the following, effective April 6, 2022:
Income Tax: Scottish tax bracket thresholds for the 20% and 21% brackets. The threshold for the 21% bracket increased by GBP 392 to GBP 13,118.
Social Security: Monthly employee and employer minimum wage thresholds by GBP 26 to GBP 823 and GBP 21 to GBP 758, respectively.
United States
Income Tax: Updated the limitations on host housing expenses eligible for exemption, effective January 1, 2022. Locations not considered high cost use the default of USD 33,600.
Arkansas
Income Tax: Decreased the top bracket rate by 0.4% to 5.5% and increased the bracket thresholds, effective January 1, 2022. The threshold for the 5.5% top bracket increased by USD 1,200 to USD 39,700.
Idaho
Income Tax: Increased the tax bracket thresholds for all filing status, effective January 1, 2022. The threshold for the 6.5% top bracket increased by USD 373 to USD 8,312 for single taxpayers.
Maine
Income Tax: Increased the following for all filing status, effective January 1, 2022. Amounts shown apply to single taxpayers:
Tax bracket thresholds. The threshold for the 7.15% top rate increased by USD 1,300 to USD 54,450.
Personal exemption by USD 150 to USD 4,450.
Standard deduction and exemption phaseout thresholds. The thresholds increased by USD 2,000 to USD 85,850 and USD 6,700 to USD 286,200, respectively.
Montana
Income Tax: Increased the following, effective January 1, 2022:
Tax bracket thresholds. The threshold for the 6.75% top bracket increased by USD 1,000 to USD 19,800.
Minimum and maximum standard deductions for all filing status. The deductions increased by USD 120 to USD 2,260 and USD 260 to USD 5,090, respectively, for single taxpayers.
Personal exemption by USD 130 to USD 2,710.
Nebraska
Income Tax: Increased the following for all filing status, effective January 1, 2022. Amounts shown apply to single taxpayers:
Tax bracket thresholds. The threshold for the 6.84% top bracket increased by USD 970 to USD 33,180.
Standard deductions. The deduction increased by USD 250 to USD 7,350.
Exemption credit by USD 4 to USD 146.
New York
Income Tax: Changed the following, effective January 1, 2022:
Removed the 5.9% bracket.
Decreased the 5.97% and 6.33% bracket rates to 5.85% and 6.25%, respectively.
Updated the tax benefit recapture worksheets to incorporate the new tax rates.
North Dakota
Income Tax: Increased the tax bracket thresholds for all filing status, effective January 1, 2022. The threshold for the 2.9% top rate increased by USD 13,350 to USD 458,350 for single taxpayers.
Utah
Income Tax: Decreased the tax rate by 0.1% to 4.85%, retroactively effective January 1, 2022.
Vermont
Income Tax: Increased the following for all filing status. Amounts shown apply to single taxpayers:
Tax bracket thresholds, effective January 1, 2022. The threshold for the 8.75% top bracket increased by USD 6,200 to USD 213,150.
Standard deductions, effective January 1, 2021. The deduction increased by USD 100 to USD 6,350.
Uruguay
Increased the following, effective January 1, 2022:
Income Tax: Tax unit (BPC) to UYU 5,164, which increased the tax bracket thresholds. The threshold for the 36% top bracket increased by UYU 405,720 to UYU 7.1 million.
Social Security: Social security wage ceiling by UYU 149,832 to UYU 2.6 million.
Income Tax Treaties
Added the treaty between Morocco and Zambia, effective January 1, 2022.