Worldwide Payroll News 2006 Archive - Sponsored by HRD & Payroll Solutions

• they were not offered a meal break, or payment in lieu, after 5 hours of work; and
• they were required to start work 15 minutes before their rostered time, for no pay.

In his judgement, Industrial Magistrate Stephen Lieschke said the breaches went "to the financial advantage of Greenearth and to the financial and personal detriment of each worker. Paying the correct minimum rates of pay is the very foundation of an award system that ensures a fair day's wage for a fair day's work."

SafeWork SA noted the magistrate's concern at the lack of any system to keep up with changes to the relevant Award and put those changes in place. Link

Canada

2007 automobile deduction limits and expense benefit rates for business

On December 27, the prescribed rates for the automobile operating expense benefit for 2007 were announced.

• The limit on the deduction of tax-exempt allowances paid by employers to employees using their personal vehicle for business purposes for 2007 will remain at 50 cents per kilometre for the first 5,000 kilometres driven and 44 cents for each additional kilometre. For the Yukon Territory, Northwest Territories and Nunavut, the tax-exempt allowance will remain at 54 cents for the first 5,000 kilometres driven and 48 cents for each additional kilometre. The allowance amounts reflect the key cost components of owning and operating an automobile, such as depreciation, financing, insurance, maintenance and fuel costs.
  
  
• The general prescribed rate used to determine the taxable benefit relating to the personal portion of automobile operating expenses paid by employers for 2007 will remain at 22 cents per kilometre. For taxpayers employed principally in selling or leasing automobiles, the prescribed rate will remain at 19 cents per kilometre. The amount of the benefit reflects the costs of operating an automobile. The additional benefit of having an employer-provided vehicle available for personal use (i.e., the automobile standby charge) is calculated separately and is also included in the employee's income. Link

Canada

Manitoba - Personal income tax reductions effective January 1

Included in the tax changes effective January 1, 2007, is the reduction in the middle bracket of personal income tax from 13½% to 13 % and an increase in the basic personal tax credit from $843 to $854. Link

Newfoundland and Labrador - Minimum wage increases to $7.00 per hour

Effective January 1, 2007, the minimum wage in the province is increase from $6.75 to $7.00 per hour. Link

• Confirmation that the current practice in relation to the calculation of the general exemption where there is a leap year.
  
  
• Confirmation that the current practice whereby the calculation of Australian Wide Wages is based on the wages that are taxable in each jurisdiction.
  
  
• Amendment the existing recovery provisions so that all group members are jointly and severally liable for the group's payroll tax debts irrespective of whether that group member paid wages in Tasmania. Link

Victoria

The State Taxation Legislation (Housing Affordability) Act 2006, which received Royal Assent on 22 December 2006, brings forward the second pay-roll tax rate cut. In the 2006-07 Budget the Government announced a three-stage reduction in Pay-roll Tax:

• from 5.25% to 5.15% from 1 July 2006 (already effective)
• the second, from 5.15% to 5.05% from 1 July 2007
• the third, from 5.05% to 5% from 1 July 2008.

This change brings forward the second reduction from 1 July 2007 to 1 January 2007. The final reduction remains applicable from 1 July 2008. Link

Canada

2007 Indexation Adjustment for Personal Income Taxes

The Revenue Agency has made a Fact Sheet available, showing the increases to the personal income tax amounts and bracket thresholds that take effect from January 1, 2007. Since 2000, they have been indexed to inflation using the Consumer Price Index data provided by Statistics Canada. Link

Ireland

Minimum wage to increase in January and July 2007

The Government has accepted the Labour Court recommendation to increase the national minimum wage, currently €7.65, to €8.30 per hour from 1 January 2007 and to €8.65 from 1 July 2007.

The sub-minimum rates which may be paid to certain categories of employee, for instance to persons under the age of 18, to first time job entrants or to those engaged in structured training or study will also be increased pro rata from these dates. Link

PRSI changes for 2007

All of the new PRSI tables are available on the website of the Department of Social and Family Affairs. The principle changes for 2007 are:

• the employee's annual earnings ceiling (above which they pay no social insurance contributions) has increased from 46,600 to €48,800
  
  
• the threshold for employee PRSI has increased from €300 a week to €339 a week
  
  
• the threshold for payment of the 2% Health Contribution has increased from €440 a week to €480 a week
  
  
• the annual earnings threshold for the Health Contribution has increased from €22,880 to €24,960
  
  
• an additional 0.5% Health Contribution has been introduced on earnings exceeding €1,925 per week (equivalent to €3,850 per fortnight and to €8,342 per month). Link

New Zealand

Minimum wage to increase nearly 10% in April 2007

The minimum wage, which applies to people 18 years and over, will increase from $10.25 to $11.25 an hour ($450 for a 40 hour week) from 1 April 2007 - a 9.8% increase.

The youth minimum rate, for workers aged 16 and 17 years, will increase from $8.20 an hour to $9.00 an hour, to stay at 80% of the adult minimum wage. The minimum training wage will increase to the same rate.

Around 110,000 adult workers and 9,200 youth workers will benefit from the increase. Link Link

Certificate of exemption from withholding tax

From 1 April 2007, new certificates of exemption will be the size of a credit card, covered in holographic foil and valid for up to five years. The period of validity will depend on the contractor's tax record in New Zealand. Link

Philippines

DOLE advises employers on pay rules for Yuletide regular and special holidays

December 25 (Christmas Day), and 30, 2006 (Rizal Day), and January 1, 2007 (New Year's Day) are regular holidays, while December 26, and 31, 2006 (the last day of the year) are special non-working days nationwide. Link

• the increase in the exemption threshold from the payment of Skills Development Levy from R 250 000 to R 500 000
  
  
• incorrect completion of EMP 201 Return
  
  
• manual IRP 5 Certificates not complying to the validation rules
  
  
• issue of IRP 5 Certificates to taxpayers. Link

• An employer is prohibited from standing employees down in these circumstances unless it is authorised by the Workplace Relations Act or relevant industrial instrument or contract of employment. A court will be able to impose penalties of up to $33, 000 on a corporation that breaches this provision.
  
  
• An employee who is stood down, or the Office of Workplace Services, is able to seek an injunction where a stand down is not authorised.
  
  
• The model dispute resolution process applies to disputes about the use of the stand down provisions in the Act.

Employees and employers may agree to cash out personal carer's leave that has accrued pursuant to the Australian Fair Pay and Conditions Standard. An employee is able to cash out any amount of personal/carer's leave, provided that (for full-time employees working a 38-hour week) at least 15 days remain available after cashing out and a number of other conditions are met, including:

• the relevant workplace agreement includes a specific provision that entitles the employee to elect to cash out an amount of personal/carer's leave
  
  
• the employee makes a separate written request to cash out personal/carer's leave
  
  
• the employee is paid an amount in lieu at a rate that is no less than the employee's basic periodic rate of pay
  
  
• the employer has agreed before any cashing out occurs
  
  
• the employer has not required or pressured an employee to cash out personal/carer's leave. Link

Canada

Tables on Diskette for 2007

T4143 Tables on Diskette (TOD), effective from January 1, 2007, are now available. Link

Alberta - Christmas and New Year's General Holidays

This year, both Christmas Day and New Year's Day fall on a Monday. Under Alberta's Employment Standards legislation, the following rules apply… Link

New Brunswick - Province supports pension income splitting (06/12/08)

Support for the federal pension-income-splitting measure was announced on 6 December 2006. Couples with pension income in New Brunswick will also be able to split eligible pension income for provincial tax purposes effective for the 2007 taxation year. The measure will provide a significant amount of tax relief to couples with pension income by permitting the higher-income spouse to allocate up to 50 per cent of the pension income to the other spouse, which is taxed at lower rates. Link

Ireland

Budget 2006

Among the changes announced in the Budget on 6 December are the following:

• The interest rate charged on overdue income tax, Canada Pension Plan contributions, and Employment Insurance Premiums will be 9%.
  
  
• The interest rate paid on overpayments will be 7%.
  
  
• The interest rate used to calculate taxable benefits for employees and shareholders from interest-free and low-interest loans will be 5%. Link

Manitoba - First-of-its-kind payday loan legislation passed by Manitoba legislature

The Manitoba legislature has passed amendments that will require payday loan companies to operate within a comprehensive regulatory framework. The provincial legislation:

• Requires the company to be licensed and bonded and that borrowers receive warnings about the high cost of loans. The maximum cost of credit that lenders could charge for payday loans will be set by an order made by the Public Utilities Board (PUB).
  
  
• Prohibits additional fees when loans are renewed, extended or replaced by new loans unless these additional fees are authorized by the PUB.
  
  
• Prohibits the practice of signing over future wages and title loans.
  
  
• Gives the right to cancel a loan without penalty within 48 hours.
  
  
• Gives the Manitoba Consumers' Bureau the right to access licensed premises to inspect the operations and make copies of records. If there is evidence that payday loans are being offered through unlicensed premises, the Consumers' Bureau will also have the right to access and inspect those operations.

Under the Constitution, the federal government has responsibility for interest. Section 347 of the Criminal Code establishes that interest rates over 60 per cent are criminal. Interest and administrative charges typical for small-sum short-term loans provided by payday lenders generally exceed this amount.

When federal amendments to the Criminal Code are in place, public hearings will be held by the PUB to allow consumers, community groups and business to make suggestions about the fees. PUB orders setting fees to be charged for payday loans would follow the hearings. Link

Manitoba - Workers' Compensation

The average assessment rate that Manitoba employers pay for their workers' compensation coverage will remain stable at $1.68 effective January 1, 2007.

Manitoba employers will pay an average of $1.68 per $100.00 of their assessable payroll to the WCB for injury insurance coverage, including wage loss payments, medical benefits and rehabilitation services. An employer's actual rate may be lower or higher, depending on their firm's injury cost record, and their industry's safety risk.

The gradual phase-out of the employer's maximum assessable earnings ceiling is continuing. The 2007 maximum assessable earnings will be set at $71,000.

In addition to those firms which will see their premium rate drop in 2007, 22 percent of firms will experience no change in their premium rate and 14 percent will see their premium rate rise. The WCB expects to collect about $184,000,000 in premiums from covered Manitoba employers in 2007. Link

New Brunswick - Two minimum wage increases planned and annual review of rate pledged

Two planned increases to the province's minimum wage were announced today by Post-Secondary Education, Training and Labour Minister Ed Doherty, who also pledged a rate review at least once a year by the Minimum Wage Board.

After considering the recommendations provided by the board, government approved an increase to the provincial minimum wage rate to $7 per hour on January 1, 2007, and another increase to $7.25 per hour on July 1, 2007. Once both increases take effect, the minimum wage rate will be up about eight per cent from the current level of $6.70 per hour. Link

Ontario - Holiday season has three public holidays under Employment Standards Act, 2000

Many employees will get three public holidays off this holiday season with public holiday pay. Three of eight public holidays under Ontario's Employment Standards Act, 2000 fall on Christmas Day on December 25, Boxing Day on December 26 and New Year's Day on January 1.

Generally, employees qualify for public holiday entitlements unless they fail, without reasonable cause, to work:

• Their entire regularly-scheduled shift before or after the public holiday; or
• Their entire shift on the public holiday if they agreed or were required to work that day.

Public holiday pay is an amount equal to an employee's regular wages earned in the four work weeks prior to the public holiday plus any vacation pay payable during that period, divided by 20. Link

India

Income-tax deduction from salaries during the financial year 2006-2007

The Central Board of Direct Taxes has issued Circular No. 11 containing the rates of deduction of income-tax from the payment of income chargeable under the head "Salaries" during the financial year 2006-2007 and explaining certain related provisions. Link

Ireland

Labour Court recommendation on the National Minimum Wage

The Minister for Labour Affairs has received the Labour Court's recommendation in relation to the national minimum hourly rate of pay. The Labour Court has recommended that the minimum hourly rate of pay should be increased to €8.30 per hour with effect from 1 January 2007 and €8.65 with effect from 1 July, 2007. Link

Funding of €27m for extending of paid maternity leave to 26 weeks

The Minister for Social Affairs has announced an allocation in Government spending of €27 million to fund the extending of Maternity Benefit entitlements from 22 weeks to 26 weeks from early next year. Minister Brennan said the increase of 4 extra weeks to 26 weeks, or six months, for paid maternity leave will commence from 1 March 2007.

Based on the increase in the numbers of women claiming the benefit over the last two years and the growth in Ireland's population, it is estimated that at least 43,000 women will qualify for the extended leave during the year between March 2007 and March 2008.

Paid Maternity Leave is presently 22 weeks, with the option of an additional 12 weeks unpaid leave. From next March this will increase to 26 weeks with the option of an additional 16 weeks unpaid leave under the National Childcare Strategy 2006-2010.

The rate of payment was increased in the last Budget by over 10% to a minimum of €182.60 per week (from €165.60). The maximum rate is now €265.60 per week. Link

PAYE Notice to Employers for tax year 2007

Revenue has issued a PAYE Notice to all employers with the preliminary bulk issue of tax credit certificates for 2007. It provides information on the operation of PAYE, including

• Employee Tax Credit Certificates 2007
  
  
• ROS delivery of Employee Tax Credit Certificates previously issued on diskette
  
  
• 2006 P35 returns: Switch from diskette to ROS
  
  
• Expenses payments made to employees
  
  
• Personal Public Service Numbers
  
  
• Completing the Form P45
  
  
• Procedure when a new employee commences, who has a P45 from a previous employment
  
  
• Supplies of Form P45
  
  
• PAYE Self-Service for Employees. Link

P35 Returns 2006: Switch from diskette to ROS

Revenue has decided to discontinue with diskette services for filing P35s in favour of the Revenue On-Line Service (ROS). Employers have also been advised that the due date for the return of 2006 P35s is 15 February 2007. Accordingly, all employers who have not registered for ROS to date should do so immediately to enable them to file their returns in good time. Link

New Zealand

Payroll News Issue 92 December 2006

The latest issue of Payroll News includes articles about calculating holiday pay, employing seasonal or casual workers, payment due dates over the Christmas and New Year holiday period, and employing schoolchildren. Link

Singapore

Singapore and Qatar sign Agreement for the Avoidance of Double Taxation

Singapore and Qatar signed an Agreement for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income (DTA) on 28 November 2006.

The DTA clarifies the taxing rights of each country on all forms of income, and provides for the elimination of double taxation on income that may occur as a result of cross-border economic activities between the two countries.

With the signing of this Agreement, Singapore has signed comprehensive DTAs with 59 countries. The DTA will enter into force after its ratification by both countries. Link

Singapore-Fiji Avoidance Of Double Taxation Agreement Ratified

Singapore's agreement with Fiji for the avoidance of double taxation came into effect on 28 November 2006. The agreement specifies the taxing rights of each country on all types of income earned from 1 January 2007.

The agreement provides for tax exemption or reduction of tax in Fiji on various types of income earned by residents of Singapore, and vice versa. With this latest agreement, Singapore now has in force double taxation agreements with 53 countries. Link

• business professionals Link
  
  
• information technology professionals Link
  
  
• mining site employees Link
  
  
• mechanical, automotive and electrical tradespersons Link

The Record Keeping Evaluation Tool has now been updated to reflect the recent changes in legislation. Link

New South Wales - August 2006 issue of Your Workplace Online published Link

Queensland - Wageline issues award summary sheets for selected Queensland state awards as a quick reference guide for employers and employees Link

Western Australia - The Western Australia Industrial Relations Commission had handed down a decision to increase the statutory adult minimum wage to $504.40 from 1 September 2006. Link

Western Australia - the latest issue of Labour Relations Newsletter is now available Link

New Zealand

The KiwiSaver Bill was passed in Parliament on 31 August 2006. Link