Worldwide Payroll News 2007 Archive - Sponsored by HRD & Payroll Solutions
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3 February 2007
Canada
Manitoba - Changes to employment standards
Manitoba's Employment Standards Branch has published a number of fact sheets explaining the changes to employment standards that come into force at the end of April 2007.
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Yukon - Minimum wage to increase April 1
Effective as of April 1, the Yukon Minimum Wage will increase 12 cents per hour, raising it from $8.25 to $8.37 per hour.
In March 2006, the Yukon government supported the recommendation from the Yukon Employment Standards Board to annually set the Minimum Wage against the Consumer Price Index (CPI), as practiced with the Fair Wage Schedule.
Statistics Canada released the annual CPI figures on January 23, noting a 1.5% annual average increase for 2006. As a result, the Yukon Minimum Wage and the Fair Wage Schedule will increase accordingly effective April 1. The Fair Wage Schedule will also increase by 1.5% across the four wage categories.
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Ireland
New employment permit arrangements
On 24 January 2007, the Minister for Enterprise, Trade and Employment, Micheál Martin, announced the introduction of four new types of employment permit, including Green Cards. These new arrangements will come into operation on 1 February 2007. The Employment Permits Act 2006 passed by the Oireachtas last year, together with the Employment Permits Act 2003, provide the statutory basis for the new schemes.
The four new types of employment permit are:
- the Green Card Scheme
- the Work Permit
- the Intra-Company Transfer Permit, and
- Spousal and Dependant Permits.
Green Card Scheme
The Green Card scheme applies to occupations where there are strategically important high level skills shortages. The scheme will be available for an extensive list of occupations with annual salaries of €60,000 and above, and for a specified list of occupations with salaries between €30,000 and €60,000.
Green Cards will be issued for two years initially and will normally lead to the granting of permanent or long-term residence after that. Green Card holders will also be permitted to bring their spouses and families to join them immediately.
The new Green Card Scheme replaces the previous Work Visa/Work Authorisation scheme, which has been discontinued.
Work Permits
The revised Work Permit scheme is mainly for non-Green Card occupations in the €30,000 to €60,000 annual salary range. It will only be granted in exceptional circumstances for occupations with salaries below €30,000.
In order to establish that vacancies which are the subject of Work Permit applications cannot be filled by Irish or other European nationals, they will be the subject of a rigorous labour market needs test. There are also a number of categories of employment for which Work Permits will not be considered, because it is clear that they can be filled from within the EEA.
Work permits will be granted initially for a period of 2 years, and then for a further period of up to 3 years.
Intra-Company Transfer Permits
This transfer scheme for trans-national senior management, key personnel and trainees is designed to allow multi-national companies to transfer these types of staff between branches in different countries, or to transfer staff with particular skills, knowledge and expertise here on a temporary basis in a start-up situation.
These permits will only be available for those with annual salaries above €40,000 who can clearly show that they fit into one of these three categories and who have been with the sending company for one year. They will be issued for a period of two years initially, with the possibility of an extension for up to a further three years. No labour market needs test will be required.
Spousal/Dependant permits
The new Spousal/Dependant Work Permit will allow the spouses and dependants of Employment Permit holders who are entitled to reside here to apply for Work Permits. This will allow the spouses and dependants of work permit holders to help support their families. These applications will not require a labour market needs test and may be in respect of any occupation in the labour market.
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National minimum wage guidance for 2007
A new information leaflet explaining the payment rules applicable to the new €8.30 minimum wage rate that applies from 1 January 2007 has been published by the Department of Enterprise, Trade and Employment.
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New Zealand
Wrong Fringe Benefit Tax calculation sheet for IR 421
Inland Revenue has advised employers that the FBT taxable value calculation sheet, issued with the income year return (IR 421) for the year ended 31 March 2006, is not the correct one for this period. Changes to the calculation of the taxable value of motor vehicles, free subsidised or discounted goods and services, subsidised transport, low-interest loans and contributions to funds, insurance and superannuation schemes which became effective from 1 April 2006 apply to periods beginning on or after 1 April 2006.
For periods ending 31 March 2006 the rates applying before 1 April 2006 must be used. The correct calculation sheet for the year ended 31 March 2006 can be downloaded at the link below.
Employers who have already filed their return and have used the wrong calculation should contact Inland Revenue.
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Payroll News Issue 93
The February 2007 issue of Payroll News includes items about KiwiSaver, the 2008 PAYE tables, getting a special tax code certificate and the new style certificate of exemption from withholding tax.
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Philippines
Proposed P125 across-the-board wage increase
The National Wages and Productivity Commission has issued a press release, stating that the majority of the industries in the regions are not in favor of the proposed P125 across-the-board wage increase, saying that it would only lead to disinvestments and massive job loss.
The House of Representatives recently passed on third reading the proposed 125 pesos daily across-the-board wage increase for workers in the private sector. The salary hike is to be staggered over a three-year period, or until October 1, 2008, 45 pesos for the first year, 40 pesos for the second year, and another 40 pesos for the third year.
Across-the-board means every worker, from the manager down to the lowest laborer, in every enterprises, regardless of its financial condition, is slated to receive the same P125 wage increase.
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Singapore
Double Taxation Agreement with Ukraine
An Agreement for the Avoidance of Double Taxation and Prevention of Fiscal Evasion with respect to Taxes on Income was signed on 26 January 2007 between the Republic of Singapore and Ukraine.
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South Africa
Wholesale and retail wage increases for 2007
With effect from 1 February 2007, new wage increases for the Wholesale and Retail Sector became effective.
For workers who work 27 ordinary hours per week or less in Area A (more urbanised areas) the increase is 9.7%. This means that a cashier in Area A who earned at an absolute minimum R10,29 an hour is now earning R11,29.
For those workers working more than 27 ordinary hours per week, a 6% increase is applicable in Area A and Area B (peri-urban areas). Workers in Area C (rural areas) are entitled to 95% of the sum of money paid to Area B workers.
This means that a cashier who was earning R9,91 an hour in Area A now gets R10,50. The same cashier in Area B earns R8,46 an hour, while a cashier in Area C is paid R8,04, which is 95% of the rate paid to Area B.
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27 January 2007
The countries whose websites we visit each week are currently Australia, Canada, Hong Kong SAR, India, Ireland, Kenya, New Zealand, Pakistan, Philippines, Singapore and South Africa.
If your country is not included and you would like us to look for relevant payroll related news items, please let us have the appropriate links to your country's English language revenue, social security and labour law websites.
Australia
Penalties and interest charges
The Australian Taxation Office has issued a simple guide to penalties and interest that can be imposed on the major taxes and basic information on reasons for imposition, reduction and grounds for remission of penalties and interest.
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Hong Kong SAR
Employers fined for breaching Employment Ordinance
A construction contractor, Mr Cheung Chu-fai, was fined a total of $26,000 at the Kwun Tong Magistrates' Courts on January 23 for wage and holiday pay offences under the Employment Ordinance. The prosecution was launched by the Labour Department.
Mr Cheung was fined $14,000 for failing to pay wages to two employees within seven days after the termination of employment as required by the ordinance. The amount of wages involved was about $28,000.
Meanwhile, he was also fined $12,000 for failing to give holiday pay for three statutory holidays to the two employees within the statutory time limit. The holiday pay involved was $4,200. In addition to paying the fines, the employer was ordered to clear the outstanding wages and holiday pay via court.
On the same day, at the Fanling Magistrates' Courts, Winky Development Limited and Law Chi-ming (trading as Ming Lee Decoration Eng) were each fined $20,000 for wage offences under the Employment Ordinance.
Winky Development Limited failed to pay wages to an employee within seven days of the expiry of the wage period and the termination of employment. The amount of wages involved was about $28,000.
Law Chi-ming failed to pay wages to two employees within seven days of the expiry of the wage period. The amount of wages involved was $13,000.
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Philippines
Congress asked to reconsider position on wage hike bill
At least five regional wage boards have signed a resolution requesting members of Congress to reconsider their position in enacting a P125 per day across-the-board wage increase.
Citing the impact and repercussions to the regional economy of the wage bill, the Regional Tripartite Wages and Productivity Boards (RTWPBs) in Regions I, IV-B, VII, X and CARAGA also asked the lawmakers to leave the issue of wage fixing to the RTWPBs as mandated under Republic Act 6727.
Labor and Employment Secretary Arturo D. Brion welcomed this development, saying that the wage boards at least have the direct dealings with both the employers and workers being a tripartite body.
"They (wage boards) know exactly what the sentiments in the regional level are, particularly the prevailing economic conditions in their respective areas," Brion said. As tripartite body, a wage board is composed of representatives from the government, labor, and business sectors. Members of the five regional boards unanimously approved their resolutions.
Meanwhile, National Wages and Productivity Commission (NWPC) OIC-Executive Director Esther Guirao said other regional boards are also working on their separate resolutions and she expects to receive them this week.
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20 January 2007
The countries whose websites we visit each week are currently Australia, Canada, Hong Kong SAR, India, Ireland, Kenya, New Zealand, Pakistan, Philippines, Singapore and South Africa.
If your country is not included and you would like us to look for relevant payroll related news items, please let us have the appropriate links to your country's English language revenue, social security and labour law websites.
Canada
Tax convention with Finland
The Convention between Canada and Finland for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income entered into force on January 17, 2007. The Convention was signed on July 20, 2006. In accordance with Article 27 of the Convention, its provisions have effect, in respect of withholding taxes, on amounts paid or credited to non-residents on or after January 1, 2006; and in respect of other taxes, for taxation years beginning on or after January 1, 2006.
The Convention replaces the tax treaty signed in 1990 between Canada and Finland.
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New Brunswick - March 1 deadline for employers to apply for SEED program
New Brunswick employers planning to hire a student for summer employment have until March 1 to apply for funding through the Student Employment and Experience Development (SEED) program.
The provincially-funded SEED program provides summer jobs to eligible students in provincial government departments and agencies, municipal and First Nation offices, and non-profit organizations. Students entering a post-secondary program in the fall of 2007 are eligible to apply. The program will provide employers a wage supplement of $7.25 per hour to help students gain work experience while earning a living during the summer months. Employers are encouraged to top up the wage whenever possible.
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Hong Kong SAR
Enhanced features of the Tax Computation
The Inland Revenue Department has developed a simple tax computation program to help taxpayers calculate their tax liability under Salaries Tax or Personal Assessment. The procedure involves selecting the relevant assessment year and, in the input page, selecting marital status, the taxpayer's and spouse's (where applicable) total income and number of dependants, and pressing the "Compute" button at the bottom. Another page will appear which shows the estimated tax liability.
For taxpayers liable for Salaries Tax, the program can indicate whether it is advantageous to elect Joint Assessment by inputting also inputting the spouse's income and deductions in the input page. If back pay, gratuities, terminal/retirement award have been received, the program may also be used to check whether it is advantageous to have the lump sum payment related back to the relevant periods.
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Ireland
Increases in earnings ceilings for maternity and adoptive benefit
The ceiling on reckonable earnings applied to Maternity and Adoptive Benefit have increase from €332 to €350 per week from 1 January 2007. This increase raises the maximum rate of payment, i.e. 80% of reckonable earnings in 2006, from €265.60 to €280 per week. In addition, the minimum rate of payment goes up from €182.60 to €207.80 per week.
The period of paid maternity leave increases from 22 to 26 weeks for women who commence their maternity leave on or after 1st March 2007.
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13 January 2007
The countries whose websites we visit each week are currently Australia, Canada, Hong Kong SAR, India, Ireland, Kenya, New Zealand, Pakistan, Philippines, Singapore and South Africa.
If your country is not included and you would like us to look for relevant payroll related news items, please let us have the appropriate links to your country's English language revenue, social security and labour law websites.
Australia
Victoria - Pay-roll tax exemption for CFA and VicSES volunteers
The Victorian Government will provide employers with a Pay-roll Tax exemption for employees away from work as volunteer firefighters or responding to other emergencies, effective from 1 November 2006. The tax exemption will take in Country Fire Authority and VicSES volunteers, responding to fires and other emergencies, such as storm damage, flooding, and search and rescue.
The exemption applies to employees not on official leave. It will provide Pay-roll Tax relief on employee wages if they are forced away from their workplaces to respond to emergencies. Any employers who are eligible for the exemption - and have paid Tax on the exempt wages for November and/or December - can make adjustments on future monthly returns or at the time of Annual Adjustment.
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Victoria - Pay-roll Tax General Information Circular
This updated Circular provides an overview of pay-roll tax in explaining who is liable, the types of payments that are subject to tax and how pay-roll tax is calculated.
In addition to updating the rate change brought about by the State Taxation Legislation (Housing Affordability) Act 2006, which received Royal Assent on 22 December 2006, the fringe benefit information on page 14 has been improved and information about salary sacrifice arrangements has been added on page 15.
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Canada
Tax convention with Korea
The Convention between Canada and the Republic of Korea for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income entered into force on December 18, 2006. The Convention was signed on September 5, 2006. In accordance with Article 28 of the Convention, its provisions have effect, in respect of withholding taxes, on amounts paid or credited to non-residents on or after January 1, 2007; and in respect of other taxes, for taxation years beginning on or after January 1, 2007.
The Convention replaces the tax treaty signed in 1978 between Canada and Korea.
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Nova Scotia - Minimum Wage Increase Recommended
The Department of Environment and Labour released a report on January 9 from the Minimum Wage Review Committee that advises an increase from $7.15 to $7.60 per hour, effective April 1. The minister has 60 days to respond to the recommendation.
The Labour Standards Code was changed in 2004 to establish the committee to review the province's minimum wage annually. It comprises two employer and two employee representatives who consider fairness, cost of living trends, and the impact of wages on competitiveness.
About 26,700 Nova Scotians (or 6.9 per cent of workers) currently work for minimum wage. The recommendation would increase the gross yearly income of people who work 40 hours per week by about 6 per cent, or $934 per year.
The increase would give Nova Scotia the highest minimum wage of any Atlantic province. Prince Edward Island's minimum wage will be $7.50 per hour on April 1, and New Brunswick's will be $7.25 effective July 1. Newfoundland and Labrador's minimum wage became $7 per hour on January 1.
The public has until February 10 to comment on the advisory committee's report.
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Ireland
PAYE Notice to Employers for tax year 2007
This annual notice is being issued to all employers with the bulk issue of tax credit certificates in January 2007.
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Tax Credits, Reliefs and Rates for the Tax Years 2006 and 2007
IT1 Tables providing all of the rates for tax years 2006 and 2007 are available on the Revenue's website.
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New Zealand
Four weeks' annual holiday from April 2007
The majority of the Holidays Act came into force on 1 April 2004. However, from 1 April 2007 all employees will become eligible for four weeks annual holidays on the date they next become entitled to annual holidays.
This is a minimum entitlement and will not mean that all employees who currently have four or more weeks' annual holidays will qualify for an extra week. Whether the employee will receive an additional week above the minimum requirement is a matter for negotiation between the employer and employee.
An employee who finishes with their employer after 1 April 2007, but before their next entitlement date, will be entitled to the following:
- payment for any annual holidays that they may have previously accrued at the greater of average or ordinary earnings; and
- payment at 8% of gross earnings for the period between the last time they became entitled to annual holidays and their termination date.
Employers will need to budget for their employees' increased annual holiday entitlements as a future liability so as not to face unplanned full costs on or after 1 April 2007. Practically, this means employers need to start budgeting for the increase from their employees' anniversary dates after 1 April 2006, being aware that the entitlements do not actually vest until 1 April 2007.
The Department of Labour has published comprehensive information on the implications for businesses in a factsheet Planning for the change to four weeks annual holidays.
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Singapore
Double Taxation Agreement with Morocco
An Agreement for the Avoidance of Double Taxation and Prevention of Fiscal Evasion with respect to Taxes on Income was signed on 9 January 2007 between the Republic of Singapore and the Kingdom of Morocco.
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6 January 2007
The countries whose websites we visit each week are currently Australia, Canada, Hong Kong SAR, India, Ireland, Kenya, New Zealand, Pakistan, Philippines, Singapore and South Africa.
If your country is not included and you would like us to look for relevant payroll related news items, please let us have the appropriate links to your country's English language revenue, social security and labour law websites.
Australia
Social Security Agreement with Norway
The agreement prevents employers having to make superannuation contributions in both Australia and Norway. It came into force on 1 January 2007. It applies to people who have been sent to Australia or Norway for work before this time, but only for superannuation contributions (or equivalent) made on or after 1 January 2007.
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Canada
Ontario - Minimum wage to rise from February 1, 2007
The general minimum wage will be raised to $8.00 per hour on February 1, 2007. This is the final increase in a four-year initiative that began February 1, 2004, at which time the government undertook to raise the minimum wage for the first time since 1995. It was phased in over a four-year period to allow Ontario business time to adjust and remain competitive.
Other minimum wage rates will also increase on February 1, 2007. The minimum wage for:
- Students under 18 years old and employed for not more than 28 hours a week during the school year or employed during a school holiday, will rise from $7.25 to $7.50 per hour
- Liquor servers will increase from $6.75 to $6.95 per hour
- Hunting and fishing guides currently paid a minimum of $38.75 for less than five consecutive hours in a day and $77.50 for five or more hours in a day (whether or not the hours are consecutive) will also increase to $40.00 and $80.00 respectively.
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Hong Kong SAR
Employer fined $50,000 for not taking out insurance cover for worker
Chan's Scaffolding Company Limited was fined $50,000 and ordered to pay costs of $3,000 at the Eastern Magistrates' Courts on December 28 for failing to take out an insurance policy for an employee as required by the Employees' Compensation Ordinance.
A scaffolding worker was employed by Chan's Scaffolding Company Limited to carry out scaffolding work in Happy Valley starting from May 2004. An industrial accident occurred when the worker dismantled the scaffold on September 28, 2005. The company reported the work accident to the Labour Department and, after an investigation, the department found that the company had not taken out an insurance policy for the employee and launched a prosecution under the Employees' Compensation Ordinance.
Section 40(1) of the Employees Compensation Ordinance stipulates that employers are required to take out insurance policies for all employees to cover their liabilities both under the ordinance and common law for injuries at work. Employers failing to secure insurance cover for their employees commit an offence and are liable on conviction to a maximum fine of $100,000 and imprisonment for one year. In addition, they are liable to pay a surcharge to the Employees Compensation Assistance Fund Board.
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