Another week will be the Spring Festival! Have you got the year-end bonus? Should I deduct taxes from year-end bonuses? I changed jobs in the middle, are there any year-end bonuses? It is related to the "money" path, you need to know these issues.
In order to motivate employees, many companies will issue year-end bonuses in various forms at the end of the year. Year-end bonuses have different distribution forms in different units. In addition to the general sense of "red envelopes", some are stock dividends, some are "thirteen salary" or "double salary", some are commissions, and some are bonuses. Is the year-end bonus required to be paid?
It is naturally exciting to get a generous year-end bonus. Is the year-end bonus necessary? The answer is: Not necessarily.
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The Labor Contract Law stipulates that when an employer recruits workers, he shall truthfully inform the workers of work content, working conditions, work location, occupational hazards, production safety conditions, labor remuneration, etc. The terms of the labor contract must clarify labor remuneration.
According to the " Regulations on the Composition of Total Wages " issued by the National Bureau of Statistics, the total wage refers to the total amount of labor remuneration paid directly to all employees of the unit within a certain period of time. The total salary consists of six parts: timely wages, piece-based wages, and bonuses. Therefore, year-end bonuses are still wage labor remuneration in broad sense.
The employer has the right to independently determine whether the year-end bonuses and other types of bonuses are issued, and the conditions and distribution standards for issuing each year-end bonus based on the comprehensive factors such as the operating conditions of the unit, the work position and performance of the worker.
However, when the labor contract or employer rules and regulations stipulates that there are "thirteen wages" or year-end bonus amount and calculation method, the year-end bonus actually belongs to the part of the employee's wage remuneration, and the employer shall implement it in accordance with the provisions of the labor contract or the provisions of the internal rules and regulations.
In addition, it should be noted that since the year-end bonus is wage labor remuneration, it cannot be paid in kind. How to calculate taxes in
?
On January 1, 2019, my country's new personal income tax law was officially implemented, and will calculate the personal income tax that should be paid for throughout the year based on the four comprehensive income and deductions obtained by individual residents, including wages, labor remuneration, royalties, and royalties.
According to current regulations, taxpayers can choose one of the two ways to calculate the year-end bonus. First, in accordance with the new personal income tax regulations, the tax will be included in the comprehensive income; second, it will be calculated separately and will not be included in the comprehensive income for the whole year.
On December 27, 2018, the Ministry of Finance and the State Administration of Taxation issued the "Notice on the Connection of Preferential Policies after the Amendment of the Personal Income Tax Law" (hereinafter referred to as "Notice"), clarifying that preferential policies such as year-end bonuses will continue to be implemented for 3 years.
The "Notice" stipulates that if an individual obtains an annual one-time bonus of and meets the provisions of the "Notice of the State Administration of Taxation on Adjusting the Methods of Calculation of Personal Income Tax for Individuals Obtaining One-time Bonus for Individuals and Other Calculations" (GuoShifa [2005] No. 9), before December 31, 2021, the comprehensive income of the year will not be incorporated into the annual one-time bonus income by the amount obtained by 12 months. According to the comprehensive income tax rate table after the month conversion attached to this notice, the applicable tax rate and the quick deduction will be determined, and the tax will be calculated separately.
From January 1, 2022, residents will receive a one-time bonus for the whole year and should be included in the comprehensive income of the year to calculate and pay personal income tax.
Personal Income Tax Rate Table Screenshot of the National Taxation Bureau website
Which tax calculation is more cost-effective?
Since there are two tax calculation algorithms , which one can allow taxpayers to enjoy more tax cuts?
as an example. For example, Mr. Zhao's annual income is 60,000 yuan, of which the year-end bonus is 10,000 yuan (average monthly average of 833 yuan). Without considering special deductions and special additional deductions, according to algorithm 1, Mr. Zhao's monthly income is equal to deduction fees of per month, that is, 5,000 yuan, then Mr. Zhao's taxable income of is 0 yuan, and there is no need to pay taxes in the year-end bonus. According to Algorithm 2, the corresponding tax rate is calculated separately to be 3%, and the year-end bonus will be taxed at 300 yuan.
For example, Mr. Qian’s annual income is 360,000 yuan, of which the year-end bonus is 50,000 yuan (average monthly average of 4,167 yuan).Similarly, without considering special deductions and special additional deductions, according to Algorithm 1, Mr. Wang’s taxable income is 300,000 yuan (average monthly 25,000 yuan), and the year-end bonus must be taxed at a tax rate of 20%. According to Algorithm 2, the corresponding tax rate is calculated separately to be 10%.
On January 9, 2019, Ye Liner, deputy director of the Income Tax Department of the State Administration of Taxation, conducted an online interview on issues related to the special additional deduction of personal income tax, said that for some middle- and low-income people, if the annual one-time bonus is incorporated into the salary and salary income of the year, after deducting basic deduction fees, special deductions, special additional deductions, etc., there may be no need to pay taxes or pay very little taxes at all. If the annual one-time bonus is calculated separately, taxes will be generated or tax burdens will be increased.
Ye Liner explained that the advantage of the annual one-time bonus policy is to calculate tax separately and not combine it with the current comprehensive income to calculate tax, thereby "split up" the income and reduce the tax rate. However, for low-income earners with low comprehensive income throughout the year, enjoying the one-time bonus policy for the whole year may increase the tax burden.
In addition, it is worth noting that if the annual one-time bonus policy is applied separately, there may be a "critical point" of sudden increase in tax burden when the tax rate shifts. This is what people usually call the phenomenon of "a year-end bonus of one yuan is given more, and the income is less than a thousand yuan."
For example, when the year-end bonus is 36,000 yuan (average monthly price of 3,000 yuan), the applicable tax rate is 3%, and the amount obtained is 34,920 yuan. If you issue an extra 1 yuan, that is, 36,001 yuan, the applicable tax rate is 10%, and the amount obtained is 32,610.9 yuan. When the year-end bonus was 38,567 yuan, the amount received was 34,920.3 yuan and 36,000 yuan.
Similarly, when the tax rate jumps from 10% to 20%, the amount of the year-end bonus of 160,500 yuan is the same as the year-end bonus of 144,000 yuan.
Is there still a year-end bonus for changing jobs in the middle of the journey
quit before working for a year, can you still receive this year's year-end bonus? This is a problem that plagues many people in the workplace and has also caused many controversies and disputes among workers.
Zhao Zhanling, deputy director of Beijing Zhilin Law Firm, once pointed out to the China Business Network client that whether workers can get the year-end bonus after leaving the job depends mainly on the employer's regulations on the issuance of year-end bonuses. "If it is paid according to the performance of the whole year, and the worker has not completed the performance of the whole year when he leaves, then the year-end bonus cannot be required; some units have an agreed bonus of 13 salaries by the end of the year, and is not linked to performance. Then, even if the worker leaves before the end of the year, the employer should pay the year-end bonus according to the proportion of the work time of the employee in this year to the full year."
Zhao Zhanling further pointed out that in addition to looking at how the performance appraisal system stipulates, it should also pay attention to whether the employee is aware of the relevant system and agrees to sign for it. "Employers must formulate relevant regulations in advance through legal means, and allow employees to fully understand the provisions through signing or meeting notices."
On January 4 this year, the official WeChat of the Zhejiang Higher People's Court reported several labor dispute cases related to year-end bonuses. The judge suggested that in order to avoid disputes, when joining the company, workers should write wages (including year-end bonuses) standards, payment status and other matters into a written labor contract, and pay attention to keeping relevant evidence, such as labor contracts, company rules and regulations, recordings and videos involving salary issues, etc. When problems arise, they can communicate with the employer as soon as possible.
In addition to determining the relevant wages and benefits with the workers in the labor contract, employers must also measure them from multiple parties, indicate fairness and reason, and formulate rules and regulations to clarify the scope, conditions, standards, time and method of year-end bonuses and other bonuses, and strengthen communication with workers. (China Business Network APP) (Wang Yongle)
