Demystifying Payroll & Wage Taxation

PAYROLL & WAGE TAXATION: INTRODUCTION : The remuneration includes the base salary and, possibly, accessories (thirteenth month, endof-year bonuses, attendance, etc.). Various other sums can, of course, be paid during the performance of the employment contract (increases for overtime, reimbursement of professional expenses) or on the occasion of its termination (severance pay). However, not all of them have the character of wages in the sense that they do not necessarily aim to remunerate the performance of work. This distinction is important because, among the different sums that the employee can receive, only those having the character of wages are taken into account to check whether the employer complies with the legislation relating to the minimum wage and, where applicable, the minimums provided for by the collective agreement. In what follows, we will know: 1. How to calculate the gross salary? 2. How to determine the CNSS contribution base? 3. How to determine the contribution base for the CIMR, Mutuels, Ass. Disease… 4. How to calculate the wage income tax? 5. How to determine the net payable? 6. How to calculate staff costs? 7. How to calculate social charges? 9. How to complete CNSS declarations 10. ANAPEC and TAHFIZ contract. 11. Examples of Actual Payslip. 11. Applications. 1-Definition of salary: The employee receives, in return for the work he provides, a remuneration called “salary”. The labor code avoided giving any definition of the salary, it was more interested in the principle of fixing its amount. Indeed, article 345 of the code provides that the salary is freely fixed by direct agreement between the parties or by collective labor agreement, but its amount is, most often, determined by the employer according to the qualification recognized in the employee upon hiring. 2-Mandatory mention of the payslip: To be legal, a payslip must include the following mandatory information: - Employer identification:Name, address, social security number, trade register number and tax ID. Identification of the employee:Number, Surname + First name, Position held, Date of hiring, Base salary, Social security number. - - Duration of work done:number of days worked, number of hours worked (with a distinction between normal hours and overtime) and paid holidays Components of gross compensation:basic salaries (hourly / monthly), mandatory elements (example: seniority bonus, paid holidays) and ancillary salary elements (example: basket bonus, transport bonus,); Details of social security contributions:amount of social contributions (CNSS, AMO, Retirement, supplementary insurance,). - Details of tax deductions(Income tax,). The net to be paid to the employee and his mode of payment. Article 375 of the labor code specifies that failure to issue a detailed payslip and failure to keep a payroll will cost the company a fine ranging from 300 to 500 $. This fine is applied as many times as there are employees without however the total of the fines not exceeding the amount of 20,000 $. 3-Base salary : Several fixing methods are possible: - At the time,depending on the effective working time (this is the most common mode); - Flat rate.A flat-rate agreement between the employee (most often a manager) and the In performance,according to known and previously defined standards (piece work, spot work, etc.); employer must then be concluded in writing. It must also be precise and quantified. The most common mode: - Base salary = number of normal hours X normal hourly rate. Example: Mr. HATIMI works in a company where wages are paid daily. The normal hourly rate is 9.50 $. The basic salary of Mr. HATIMI for a working day of 8 hours of work is 8 hours X 9.50 $ = 76 $ 4-Gross wages : The gross salary includes all agreed sums and benefits granted by the employer: Base salary, benefits in kind and in cash, bonuses, gratuities, tips, as well as increases provided for by law or collective agreements (increase for overtime, night work, Sunday work, dirty or arduous work, etc.). 4.1- Overtime: Employees may be employed beyond the normal working hours under the conditions that will be set by regulation. Three situations are provided for by the labor code: - When there are exceptional increases in workload. - When the employees must carry out preparatory or additional work essential to the general activity of the company and which cannot be carried out within the normal limits of the work. - When urgent work must necessarily be carried out immediately to prevent imminent dangers, organize rescue measures to repair accidents that have occurred to installations or buildings, or to prevent the deterioration of certain materials. The HS give rise to a salary increase of25% if they are done between 6 a.m. and 9 p.m.and to 50% if they are completed between 9 p.m. and 6 a.m.. This increase is increased respectively to50% and 100% if overtime is performed on the weekly rest day on public holidays, even if compensatory rest is granted to the employee. - Additional hourly rate = Normal hourly rate X (1 + Rate of Increase) Example :If rate of increase is 25% Additional hourly rate = Normal hourly rate X 1.25. Application : Mr. FILLALI works in a company where wages are paid at the end of each week. The normal hourly rate is 9 $. The salary of Mr. FILLALI for a week of 52 hours of work, overtime worked on a working day from 11 p.m. to 3 a.m.) is: Base salary = 48h X 9 $ = 432 $ Overtime = 4h X (9 $ X 1.5) = 54 $ Total = 486 $ 4.2- Benefits in kind: Benefits in kind consist of thesupply to the employeegoods or services produced by the employer or by making available to the employee, either free of charge or subject to a deduction less than the real value, of goods belonging to the employer. Example: Company car, housing, mobile phone, supplementary pension... This is with the aim of motivating employees and offering them a better quality of life at work and improving their performance. Benefits in kindconstitute an element of salary and must appear on the payslip. Benefits in kind are assessed on a flat-rate basis. Please note: Benefits in kind should not be confused with professional expenses. Benefits in kind cover part of the personal expenses of employees, while professional expenses are expenses inherent in or linked to the employee's employment. Examples: - When an employer provides an employee with a vehicle that he can use for both professional and personal purposes, private use constitutes a benefit in kind. On the other hand, when the employee is forced to use his personal vehicle for professional purposes, the reimbursement made by the employer corresponds to professional expenses. - Total or partial payment of meal costs by the employer is a benefit in kind. But the reimbursement of meal expenses for an employee traveling on business, present on a construction site or forced to take his meals at his place of work corresponds to professional expenses. Example of calculating the value of a benefit in kind: - The calculation of the value of a housing benefit in kind is done as follows: - The value of the accommodation is equal to the real rental value of the accommodation, increased by the other advantages linked to it such as water, lighting, heating, telephone, as well as domestic service and security. - In the absence of a real rental value, this is estimated from the value determined for the assessment of the urban tax increased by the estimate of the other benefits. Example of calculating the value of a benefit in kind: The provision, on a permanent basis andwithout the needs of the work justifying it, from a service car toan employee thereof, other than the general manager or the sales manager, must be considered as a benefit in kind. This benefit is assessed on the basis of the value of the expenses relating to the costs of the insurance, the vignette, the fuel, the depreciation of the vehicle, etc. The same applies to expenses incurred for vehicles rented by the company for the same purpose. 4.3- Silver benefits: These are reductions in personal expenses for the employee, paid in whole or in part by the employer. - The rent for personal accommodation, generally advanced by the employee and reimbursed by the employer; Medical expenses and hospitalization; Travel and special accommodation expenses; The employee's personal taxes; Personal life, health, maternity, disability, death and old-age insurance premiums covered by the employer; Participation in school fees for the benefit of staff children; The purchase of toys on the occasion of the Achoura festival for the children of the staff. 4.4- Bonuses and bonuses: Bonuses and gratuities are sums of money given by the employer to its employees. The allocation of these sums may be provided for by the collective agreement, a company agreement, the employment contract or a practice. The premiums are very varied, they can be linked: - In the presence of the employee in the company(Example attendance bonus, attendance bonus) Loyalty in the company(Example seniority bonus); At the production of the employee(Example results bonus, objective bonus, performance bonus); - To working conditions(Example risk premium, hardship premium); The personal situation of the employee(Example wedding bonus, birth bonus). - Let us also mention the thirteenth month bonuses, the end of year bonuses, ……etc. - Seniority bonus (MANDATORY): Seniority bonus: bonus added to the salary of an employee who meets the required seniority conditions: - The bonus is: 5% of base salary (plus overtime) if service between 2 to 5 years. - 10% if service between 5 and 12 years. - 15% if service between 12 and 20 years. - 20% If service is greater than 20 years. 4.5- Indemnities (amounts not having the character of salary): The indemnities are considered to be salary supplements (they do not have the character of a salary). They generally come to cover the costs incurred by the employee in the performance of his duties relating to his position. Indemnities are sums of money awarded to an employee as compensation for damage or prejudice, in compensation for certain costs. Example : - Mileage allowance for personal car use - Allowance for use of personal vehicle - Moving allowance - Clothing allowance - Shoe allowance for dirty work, - Compensation for arduous or dangerous work, - Food allowance, - Basket or meal allowance, - Travel allowance, - Living allowance, Representation allowance …… - Representation allowance:Its amount should notexceed 10% of base salary, The beneficiary of this allowance must perform one of the following functions: Chairman and CEO, CEO, Department Manager (Commercial Manager, Financial Manager, Administrative Manager, Technical Manager, Human Resources Manager, Branch Manager) and Sales Agent. - Mileage allowance:Paid to employees who use their personal vehicles in the performance of their professional duties.This indemnity is subject to deduction only when it is justified by the capacity of the beneficiary (sales agent, medical representative, etc.) or by the written order issued to the employee, when it is a question of a particular mission not normally entering and usually in the professional obligations of the person concerned, without, however, the amount exceeding the ceilings set by the following scale: Fiscal Power of the Vehicle 4 HP 5 hp 6 HP 7 HP 8 HP 9 HP 10 CV and more Mileage allowance ($S) 1.90 2.20 2.40 2.60 2.95 3.55 5.20 4.5- Family allowances: These are benefits paid by the national social security fund (CNSS) to employees with dependent children. The amount of family allowances is 300 $ per month for each of the first 3 children and 36 $ per month for each of the next 3. (With a maximum of 1008 $.) Example: The amount of family allowances received by an employee, married and having 7 children is: (300 $ X 3) + (36 $ X 3) = 1008 $ He will have nothing for the seventh child NB: Currently family allowances are paid directly by the CNSS, they no longer appear on the payslip 5-CNSS employee social security contributions: Morocco has a compulsory social security system and is a signatory to several conventions to this effect. - All employers are required to register with the National Social Security Fund (CNSS), as - The contribution rates due to the National Social Security Fund are as follows: (employee well asonly at registrationof its employees and apprentices at the fund. share) -Salary share:4.48%gross taxable salary (after the deduction of the elements not accepted by the CNSS)(The salary subject to contribution is capped at 6000 Dirhams) -AMO, 2.26% of taxable gross salary (no ceiling). The contributions due to the CNSS are based on all the remuneration received by the beneficiaries of the social security scheme; including allowances, bonuses, gratuities and any other benefit in cash or in kind, as well as any sum received directly or through a third party as a tip. These remunerations constitute what is calledthe base of the contributions base on which, are calculated the contributions. The rates to be applied when calculating the contributions are determined by law. Each of the major categories of social benefits is characterized by its own contribution rate. CNSS service Benefits family Calculation basis T. Employer T. Salary Global rate The total of 6.40% ---- 6.40% 1.05% 0.52% 1.57% actual wages of the period (month/quarter) Benefits short social term The total of wages capped (each capped at 6000 $s) Benefits long social term The total of wages capped (each capped 7.93% 3.96% 11.89% 4.11% 2.26% 6.37% 1.6% --- 1.6% at 6000 $s) Insurance The total of disease actual wages of OBLIGATORY the period (month/quarter) Tax of training professional. The total of - actual wages of the period (month/quarter) Short-term social benefits: 0.57% relating to compensation for loss of employment broken down as follows: the employer's charge is 0.38% and the wage charge is 0.19% - Companies that only pay the solidarity rate of 1.85% are partially exempt from paying the AMO contribution. The basis for calculating social security contributions: - This is the taxable gross salary, calculated as follows:SBI. = S. Gross – exemptions CNSS =SBI x4.48% (capped at 6000 $/month) Max: 268.8 $/month or 3225.6 $/year AMO =2.26%x SBI (no cap) Prime Exemption limit and condition tooling premium This premium paid to workers who own their tools is in principle excluded from the base provided that it does not correspond to expenses relating to workers who do not have tools and do not have to use them. The amount of this premium, not subject to contribution, must not exceed 100 dirhams per month. The part that exceeds this amount remains subject to contribution. Premium of soiling Wear premium of clothes It is allocated to workers who indiscriminately carry out particularly dirty work to compensate them for their cleaning costs. The amount exempted must not exceed 200 dirhams per month. The part that exceeds this amount remains subject to contribution. It is allocated to workers to meet loads of newly working clothes. The amount not subject to contribution (exempt) must not exceed 100 $ On the other hand, is subject to contribution, the premium unfairly called clothing which is paid to certain workers when their job does not expose them to dust or wear and tear clothes. Basket Bonus This bonus is not subject to a contribution when the company granting it does not organize a collective canteen. However, its attribution must be dictated by the constraint in which the worker finds himself to take a snack or a meal due to particular working conditions, such as: team work, shift work (3 times 8), continuous work, work in staggered hours, work on a construction site far from the usual place of work. The exempt fraction of the daily amount of this premium must not, under any circumstances, exceed twice the hourly minimum wage. Meals served in Ramadan Granted, in the workplace, to company personnel, when the working conditions justify it. The exemption is capped at 20 $ per day It should, however, be noted that the said exemption cannot be combined with the basket allowance. Voucher or check restoration Or feeding The sums representing the costs of catering, food or food, granted by the employer to all the personnel of the company in the form of means of payment specially intended for the nutrition and food of the employees (vouchers , catering or food vouchers or vouchers), are not subject to contribution and this, within the limit of: - 10 $ per employee and per day. 20% of the salary subject to contributions, of the beneficiary. It should be noted that this exemption cannot be combined with the so-called basket food allowance milk allowance Granted to workers handling toxic products. The amount of this premium must not exceed 150 dirhams per month. The part that exceeds this amount remains subject to contribution. travel bonus in mecca Granted only once to the employee. The amount accepted cannot exceed the price of the outward and return plane ticket plus the amount of the allocation authorized by the exchange office. Toy bounty Intended, once a year, for the children of employees and workers. achoura The value not subject to contribution of these toys must not exceed 150 $ per child, without however exceeding, per employee, a ceiling of 750 $ per year. The part that exceeds this amount remains subject to contribution. Premium purchase sheep Granted on a flat-rate basis only once a year to all staff. The amount of this allowance, not subject to contribution, must not exceed $ 2,000 per employee. The part that exceeds this amount remains subject to contribution Expenses real relative at the posts telephone Fees relating to home telephones and mobile telephones of one or more senior executives, payment of which by the employer is justified bythe quality of the beneficiary, are not subject to contribution toup to 50% of their amount. However, these royalties are totally exempt, when they are in the name of the company. Indemnity Accepted for a ceiling of 150 $ foremployees using their personal car to run errands for the company during working hours Indemnity of It's aboutforced move, in case of service necessity, by the employer. The amount of this allowance not subject to contribution, must not exceed that obtained by multiplying the kilometer rate of 10 $ by the number of kilometers separating of use of vehicle staff moving the initial place of residence of the employee and the place reassignment of the latter. The part that exceeds this amount remains subject to contribution. Indemnity of box Granted to workers who handle funds and have financial liability. The amount not subject to contribution of this allowance must not exceed 150 $ per month. Waivers or discounts This concerns the exemption or reduction of interest relating to loans granted by the employer to staff interests Allowance paid to a child of a worker from the company The allowance paid to a child of a worker of the company that the latter occupies during the summer holidays (exclusively), provided that this allowance does not exceed twice the SMIG and that it is allocated for two months maximum during the said holidays. Indemnity or Condition: Occasional movement. costs moving on To be justified by transport tickets, restaurant and hotel expense reports, etc., and to be completed by mission order supporting documents Indemnity or costs shift lump sum Requirement: Traveling direct or commercial. - Transportation :see mileage allowance scale (personal vehicle) or public transport tariff. - Food costs:10 times the hourly minimum wage per day - Accommodation costs :30 times the hourly minimum wage per day for travel exceeding 50 km. NB: Hourly SMIG is 13.46 $ (2018) The indemnity of transportation Indemnity mileage for use car personal The premium of tour 500 $ in the urban environment - 750 $ outside the city Workplace far from the place of residence more than 2 km that the company does not have staff transport. Depends on the quality of the beneficiary with mission order. 4 HP: 1.9 $ per KM / 5 HP: 2.20 per KM/ 6 HP: 2.40 per Km / 7 HP: 2.60 $ per Km 8 HP: 2.95 per Km/ 9 HP: 3, 55 $ per Km/ 10 HP and +: 5.20 $ per Km 1500 $ per month as exemption ceiling. Granted, in reimbursement of transport costs incurred in the exercise of the function, to personnel having the status of sales representative or itinerant agent, called in this capacity to visit, throughout the day, customers , suppliers, etc. travel bonus Ceiling – return ticket. on leave in home country Once every 4 years and if the employment contract stipulates it once every two years. (foreigners) medical aid Conditions: once a year. Granted in the absence of mutual insurance or group insurance. 100 $ per child with a maximum of 1000 per year and per employee. Bonuses to Condition: 5000 $ once every 4 years. social title Marriage, birth, circumcision, death of a close relative. Ceiling: Smig and maximum twice a year. When the company employs during the summer holidays, the worker's child Allowances paid to a employee's child Allowance of Condition: 400 $ per child with a maximum of 1600 per employee. Once a year for Back to School the children of employees on the occasion of the start of the school year The indemnity of Limit: maximum 10% of base salary. representation granted only to: CEO -DG-DA-DAFDRH-DT-DC and directors of departments, branches, agencies 6-CIMR dues: The CIMR scheme, whose affiliation is optional, is open to private sector employees as a complementary scheme to that of the CNSS. It is accessible to any employer established in Morocco. Membership may concern either all employees or a homogeneous category of personnel. The CIMR pension guarantees a high level of performance in terms of supplementary pensions intended for the private sector. This return allows the employee to safeguard his standard of living once he reaches retirement age. The CIMR contribution base: It depends on the product chosen at the time of affiliation. - For CIMR Al Kamil, the contribution base is made up of all the gross elements of remuneration, before their taxation (fixed salary, overtime, bonuses, etc.). - For CIMR Al Mounassib, contributions are made on the basis of the part of the salary that exceeds the CNSS ceiling The contribution rate:The amount of the contributions depends on the contribution rate. At the time of joining the CIMR, the employer opts for a contribution rate that will apply for both parts, employer and employee. The employer's share payable by the employer is equal to the employee's share, increased by 30%. The CIMR AL KAMIL Formula: By opting forCIMR AL KAMIL, the employer and his employees choose together, among the 12 proposed contribution rates, the one that suits them best. - The rate that will be chosen applieson the entire salary, without any contribution ceiling being fixed, to allow the employee to bring the level of his future pension closer to that of his working income. - The amount of contributions (salary x chosen rate) is converted each year into CIMR points. The Al MOUNASSIB Formula: By offering the possibility of contributing on the salary bracket above the CNSS ceiling, CIMR Al Mounassib improves the level of pension and maintains the standard of living in retirement. For its employees,especially the executives, allowing them to benefit from the CIMR pension plan, is the best way to motivate them and retain them, allowing them to work in peace, no longer worrying about their future and that of their families. Each of the employees' contributions, whether they come from employer or employee shares, are translated into points. 7-INCOME TAX : Studying the taxation of wage income requires defining this income (the composition of the tax base), the accepted exemptions and the appropriate method of taxation, according to the provisions of the law on wage income tax. However, wage income includes a variety of income that we will review to clarify the scope of wage IR. Once this scope is delimited, it is necessary to specify the elements to be exempted and under what conditions one is authorized to do so? This work allows the determination of a gross taxable salary, from which deductions defined by law must be deducted in order to have a net taxable salary. Depending on the level of the latter, the employer will apply the appropriate tax rate and the amount to be deducted to correctly calculate the salary IR, which is a withholding tax to be declared. SNI slices (in $) 0 – 1,666.67 1,666.68 – 2,000 2001 – 3,000 3,001 – 5,000 Over 5,000 Rate in % Amount to be deducted (In $) 0% 13% 21% 35% 44% 0 216.66 376.66 796.66 1,246.66 Example: SNI = $ 9,391 Tax before deduction = (9,391 X 44%) – 1,246.66 = 2,885.38 EXEMPTIONS: The first step: the gross taxable salary is calculated as follows Gross taxable salary = Gross salary – Exempt items - Basket allowance (granted to employees working on construction sites far from their home) - Justified travel allowance - Cash allowance - Dirt allowances - Transportation allowance - Representation allowance - Life insurance indemnity - Catering vouchers - Social rewards - Tour Bonus - Mileage allowance - Milk allowance - Moving allowance - Tool bonus DEDUCTIONS: In order to determine the net taxable salary, all the costs incurred by the employee from his salary income must be deducted from the gross taxable salary: Net taxable salary = Gross taxable salary-Deductions. In the deductions we distinguish between: - (-) CNSS contributions from employees - (-) AMO contributions from employees - (-) CIMR contributions from employees - (-) Professional expenses 20% of gross taxable salary less benefits in kind and in cash) capped at 2500.00 $ per month - (-) Repayments of principal and interest on loans contracted for the acquisition of social housing and interest only for other types of housing up to 10%taxable net salary. HAS-Professional fees Example : An employee had during the month of March an income consisting of: - Base salary: 15,000 - Various bonuses: 2,000 - Monthly rental value of accommodation made available to him: 5,000 - Support for water and electricity expenses: 1,000 The housing provided free of charge to the employee as well as the payment of water and electricity expenses are taxable benefits in kind but not taken into account for the calculation of professional expenses. Calculation of professional expenses to be deducted: Deductible professional expenses are calculated as follows: Gross salary = 15,000 + 2,000 + 5,000 + 1,000 = 23,000 Gross taxable salary = 23,000 Professional fees = (23,000 - 5,000 – 1,000) x 20% = 3,400 $ Limit of deductible professional expenses = 2,500 $. B-Repayment of principal and normal interest on loans: Is deductible from the gross taxable salary, the reimbursement in principal and normal interest of loans obtained for the acquisition of social housing for main residence (covered area between 50 and 80 m2 and sale price not exceeding 250,000 $ excluding VAT ) and this within the limit of10% of net taxable income. When these conditions are not met, the employee only benefits from the deduction of interest. - Terms : This deduction is conditionalon the condition that the amounts of the reimbursements (annuity) are withheld and paid monthly by the employer to approved credit organizations and similar organizations. Example : An employee benefited from a loan for the acquisition of his main dwelling acquired for a price of 1200,000 $. As such, it reimburses annual interest of around 42,000 $ including tax. His salary components are as follows: Annual gross salary: 400,000 Exempt items: 18,000 Professional fees and social contributions = 39,000 Example (Solution): Given the purchase price of the accommodation, the employee is only entitled to deduct the interest. (1200000 $ higher than 250000 $ HT) Deductible interest and taxable net salary are calculated as follows: Gross taxable salary:400,000 - 18,000 = 382,000 Income deductions: 39000 $ Calculation of the interest deduction limit: - Limit = (382.000 -39000) *10% = 34300 $ The interest actually paid, i.e. $ 42,000 including tax, is above the limit of 10% of net taxable salary (before interest). Deductible interest = 34300 $ Total deductions = 39000 + 34300= 73300 $ Net taxable income = 382000 - 73300 = 3080700 $ TAX RATE (INCOME TAX): The withholding tax is calculated according to the progressive scale applicable to income tax. This deduction at source is often calculated according to a monthly scale, the establishment of which, based on the annual scale, does not pose any particular problem. It suffices to bring back the annual data (income brackets and sums to be deducted) by month or any other period. Monthly income, after deduction of deductible expenses, is taxed according to the following monthly scale: 1- We determine the amount of tax according to the following table which will allow us to choose the rate to apply according to as well as the amount to deduct: 2- A second deduction is made, the amount of which is determined on the basis of the number of persons supported by the employee of 30 $ per person in charge of family without the number exceeding six people within the limit of 180 $ per month. Dependents are: - The spouse regardless of his income The taxpayer's own children or children legally adopted by him on the double condition that the annual income per child does not exceed the exempt portion of the scale and that their age does not exceed27 years old, (unless the child suffers from a permanent disability). Example :Mr. ESSADKI financial manager within the company BESTMOR. His gross taxable salary is 9500 $, he has 4 people in charge (his wife and three children aged 7, 12 and 15. CNSS 4.48% CIMR 4.5% AMO 2.26%. 1)-Calculate the wage income tax (CNSS 4.48% AMO 2.26%, CIMR 4.5%) 2)-Calculate the net salary to be paid 1)-Calculation of wage income tax: - CNSS CNSS 4.48% (ceiling of 6000 $) 6000*4.48% = 268.8 $ - AMO (-) 2.26% (Without ceiling) 9500*2.26% 214.7 $ - CIMR 9500* 4.5% $ 427.5 To calculate the professional expenses, we must first deduct the deductible expenses (CNSS, AMO and CIMR). Thus to calculate the professional expenses, we will retain the rate of 20%, since it is a normal activity, but not to exceed 2500 $ 9500* 0.2=1900 $ we will therefore retain 1900$ (lower to 2500). Let's calculate the net taxable salary: SNI= SBI- DEDECTIBLE EXPENSES- PROFESSIONAL EXPENSES = 9500-268.8-214.7-427.5-1900 =6689.5$ GROSS IR= (SNI*34%) -1433.33$ = (6689.5*0.34= 2274.43$) -1433.33$=841.13$ IR NET: From this amount must be deducted the equivalent of 120 $ (30*4 dependents of the employee: IR NET= IR GROSS- (30$*4) = 841.13-120$ = 721.13$ 2)-Calculation of the net salary to be paid: Net salary to pay = Gross salary 9500 $ - CNSS $ 268.8 AMO $ 214.7 CIMR 427.5 $ IR 721.13 $ Net salary to pay =7867.87$ After the determination of the net salary, it is advisable to check if one must take elements which fall within the framework: - Advances and down payments recovered:An advance granted to an employee during a period (the beginning of the month in general) is recovered from his salary at the end of this period. Salary assignments:The employee may, of his own free will, accept that part of his salary be withheld from him by the employer to be paid directly to his creditors. This is then an assignment of wages. Consumer credit companies require the employee, before granting him the credit, a document according to which the employee gives his employer the irreversible order to withhold and send them a determined monthly amount until the - extinction of the credit. Objections:Oppositions result from a decision pronounced by the court. Indeed To recover his due, a creditor can sometimes initiate legal proceedings which end upa garnishment on the debtor's wages.Example: The alimony due to the spouse, in accordance with the Personal Status Code, is payable monthly, its amount is deducted in full each month from the unseizable portion of the salary, whether this pension is paid by garnishment or by assignment of the salary. Note: Declaration of tax on salary income Employers domiciled or established in Morocco must file the declaration of tax on salary income no later than March 1 of the year following that in respect of which the salary income was been paid. They are required to submit the declaration of wage income and assimilated income against a receipt to the tax inspector for the place of their tax domicile, their head office or their main establishment. 8-ANAPEC DEVICE: Goals : - Enable job seekers to develop their practical skills within the company and strengthen their chances for sustainable integration. - Enable companies to strengthen their human capital and retain it while controlling costs; Target population : - Higher education graduates; - Winners of vocational training; - Bachelors. Type of device: - Internship contract for a maximum of 24 months; - Monthly allowance granted: 1600 to 6000 $. Benefits : - Exemption during the internship period and within the limit of a remuneration of 6000 $ per month of payment: - Employer and employee contributions due to the CNSS/TFP; - Income Tax (IR) for candidates registered with ANAPEC for 6 months or more; - Payment by the State, during the internship period, of employers' and employees' contributions under the basic Compulsory Health Insurance (AMO); - Direct payment by the State, for one year, of the employer's share of the social security cover and the TFP due to the CNSS in the event of the recruitment of the intern on an employment contract, during or at the end of the internship (PCS). Terms of benefit: - Selection of the candidate by the company as part of a recruitment process. - Registration of the candidate with the CNSS in accordance with the legislation in force; - Instruction by the employer of the online contract on the ANAPEC portalwww.anapec.org ; - Submission by the employer to an ANAPEC agency, for validation and visa, of a file consisting of the following documents: - 3 copies of the integration contract published from the portal, signed and stamped by the employer and the trainee; - A legalized copy of the trainee's CIN; - A certified copy of the trainee's diploma; - A sworn statement from the trainee who certifies that he has never benefited from an integration contract (only in the event of signature of the first contract); - A company identification form (only in the case of a new client company); - CNSS registration numberof the trainee if he is not informed about the contract. Good to know : Employers are required to: - Declare to the CNSStrainees benefiting from the system of Integration Contracts in the same way as other employees without paying the related contributions; - Recruit at least 60%people who have completed the internship to continue to benefit from the system of Integration Contracts. - When the amount of compensation paid exceeds the ceiling referred to above, the company and the trainee lose the benefit of the exemption. 9-TAHFIZ DEVICE: Exemption from gross monthly salary capped at 10,000 dirhams for recruitment by E/ses created during the period from January 1, 2015 to 12/31/2022. "Art 57-20°" & "Art 79-V of the CGI" The LF 2015 instituted a new exemption for the gross monthly salary capped at 10,000 $ for a period of twenty-four (24) months from the date of recruitment of the paid employee, By a company created during the period from January 1, 2015 to December 31, 2019 within the limit of five (5) employees but increased to 10 employees from January 2018. Terms of application: - It is granted for a period of 24 months from the date of recruitment of the employee and limited to 10 employees; - The salary must be paid by a company created during the period from January 1, 2015 to December 31, 2019; The employee must be recruited under a permanent employment contract (CDI); The recruitment must be carried out within the first two years from the date of establishment of the company. The procedure to follow to benefit from this program is as follows: - Declaration of existence of the company or association to the tax services in accordance with the legislation and regulations in force; - Registration of the person to be recruited on the ANAPEC portal; - Information by the employer of the benefit protocol of the program on the ANAPEC portal; - Registration of the employee recruited with the CNSS, in accordance with the regulations in force; - Filing, by the employer with an agency of ANAPEC, of a file per recruit including a benefit protocol of the TAHFIZ program accompanied by a legalized copy of the employment contract; - Payment by the employer to the CNSS of the employee contribution of recruits benefiting from the program, in accordance with the legislation and regulations in force; - Opening of rights by the CNSS for the benefit of recruits; - Declaration by the company or association to the tax inspector, of the list of employees benefiting from the program in accordance with the legislation and the current regulations. Sample payslip: Applications: Case 1: The salary components of Mr. TALAL, computer technician in an industrial company, for the month of November are as follows: Base salary 3000 $ Basket bonus 500$ Transport allowance 200 $ - Compensation for travel expenses 300 $ (justified up to 100 $) Further information : - The employee was recruited on 01/07/97 • He worked the following overtime: November 18 between 9 a.m. and 10 p.m., a Sunday between 6 p.m. and 7 a.m. and November 26 between 5 p.m. and 7 p.m. - The company a$eres to the CIMR (supplementary pension): 4.5% payable by the employee and 4.5% payable by the employer, group health insurance at the rate of 1.75% and 1% payable by the company calculated on the SBI. Work to do : 1/ Determine the net taxable salary 2/ Determine the amount of the IGR 3/ Establish the employee's bulletin 4/ Calculate employer charges Case 2: A married taxpayer with 7 dependent children received the following gross remuneration for the month of May 2002: - Base salary 4600 $ Technical allowance 700 $ Transport allowance 500 $ Compensation for travel expenses 500 $ (justified up to 300 $) Performance compensation 800 $. This employee contributes to the CIMR at the rate of 3% calculated on the SBI and group health insurance at the rate of 1.75% calculated on the SBI (contribution capped at 3000 $/Year) Further information - The employee was recruited on 01/04/96 He worked the following overtime: On May 1 between 7 p.m. and 10 p.m., 1 a.m. on Sunday and from 2 p.m. to 7 p.m. on May 22.