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Individual and employer tax considerations for coronavirus

Across the globe, the spread of the coronavirus is having a significant humanitarian impact and increasingly, an economic impact from stock markets to global supply chains. As governments move rapidly to contain the spread of the virus, global employers are also working to address how to manage employees in affected areas while continuing business operations.

Tax authorities are also reviewing their response and enacting changes to provide relief to affected taxpayers. Below, we have summarised key developments adopted in response to the coronavirus pandemic that impacts globally mobile employees and their employers.

Visit our COVID-19 hub for more support to navigate the impact of the virus 

Summary of tax measures in certain impacted countries

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Country Extended tax filing deadline Extended tax payment deadline Other tax measures and considerations Contacts Last updated
Argentina No No The authorities have established some reliefs to employers to compensate the economic crisis generated by the Covid-19: Extensions of the payment dates for contributions to the Social Security System .; Companies that meet certain requirements and have less than 60 employees, have the benefit of a reduction of up to 95% of Social Security Contributions.; Companies that meet certain requirements receive partial assistance for the payment of wages. This aid limits the possibility of distributing dividends for a period of approximately 24 months after receiving the benefit. Fernando Fucci - fernando.fucci@ar.gt.com 13/08/2020
Australia No No The widely publicised JobKeeper payment introduced of $1,500 per fortnight for employees of employers whose turnover has declined by 30% or 50% (businesses with a turnover greater than $1billion) will generally not apply to expatriate secondees apart from certain New Zealanders or permanent resident holders. Two Cash flow boosts in the form of a PAYG credit for employers of between $10,000 - $50,000 for businesses with an aggregated turnover of up to $50m. Payroll tax waivers and deferrals available in most states based on specific state criteria of total wages. Queensland: Deferral of state payroll tax return and payment to 3 August 2020. --- New South Wales: Waiver of Payroll tax for remainder of FY20 for businesses with payroll up to $10m. --- Tasmania: Waiver of Payroll tax for remainder of FY20 for certain businesses including hospitality and tourism. --- Western Australia: One off grant of $17,500 for Payroll tax to assist businesses with payroll between $1m and $4m. Thomas Isbell - thomas.isbell@au.gt.com 31/03/2020
Austria Yes, in certain cases three months Yes Short-time working model - reduced working time, between 90% and 10% of net salary is being paid by the company, the remainder will be paid by the Austrian Unemployment Agency. Parents get special child care holiday (three weeks max) if they have no other option for child care due to the closing of care facilities. Implementation of a Hardship Fund for small companies (one person company, companies with less than 10 employees) Phase 1: Individual entrepreneurs, small and micro entreprises get one time aid by EUR 1,000. Phase 2: Altogether, there is a subsidy by 3 times EUR 2,000 for those enterprises possible. Bridge Financing is also available for small and medium sized enterprises (companies with less than 250 employees, max. EUR 50 million turnover or EUR 43 million balance sheet total). Exemption from work (paid leave for a limited period until 31.05.2020, extension possible) or home office for COVID-19 risk groups possible with a COVID-19 risk certificate from the doctor. Christoph Schmidl - christoph.schmidl@at.gt.com and Julia Saric-Bischof - julia.saric-bischof@at.gt.com 12/05/2020
Belgium No Yes, two months The Belgian government has announced a temporary rebate (June, July & August 2020) of wage tax to employers that have benefited from the regime of temporary unemployment due to COVID-19 for at least 30 days during the period 12 March and 31 May 2020. The rebate is equal to 50% of the difference between the wage tax due for the month and the wage tax due for May 2020. For the payment of both personal income tax and non-residents tax, an additional period of two months will automatically be granted on top of the normal payment term, without charging interest for late payment. This measure applies to the tax assessments for the assessment year 2019, established as from 12 March 2020. Employers are automatically granted a two-month delay of payment for professional withholding tax without having to pay any fines or interest. Additionally from 14 March, the time that an employee spends in Belgium as a result of homeworking where they ordinarily work in Luxembourg and France, will not be taken into account to determine where employment should be taxed under the relevant double tax treaties. The tax treaties exception agreements concluded between Belgium and its neighbouring countries (France, Germany, Luxembourg and the Netherlands) have been extended until 31 August 2020 (was previously 31 May). Relating to social security, periods of time working from home in an individual's Member state of residence rather than country of employment, due to COVID-19, will not be taken into account to determine the applicable social security legislation. This relief has been extended to 31 December 2020. The process of temporary unemployment due to Corona has been extended until the 31st August 2020. If the company suffers from temporary unemployment, employees could receive an unemployment allowance of 70% of their average income (with cap of 2,754.76 EUR/month) if the company has launched the process of temporary unemployment. Samuel Leblanc - samuel.leblanc@be.gt.com and Bart Verstuyft - bart.verstuyft@be.gt.com 21/08/2020
Brazil Yes, two months to 30 June No The government has authorised reductions in working hours (25%, 50% or 70%) for up to 90 days, as well as the ability to suspect an employment contract for up to 60 days. Employees will be entitled to all benefits prior to reduction though will have a proportional reduction in salary. The Brazilian Central Bank report that individuals whose deadline to file was by 5 April 2020 has been postponed to 1 June 2020. Additional measures are being announced by the Brazilian authorities, which to date include financial support for informal workers and relaxation of employment terms. Tamara Gomes Testa -tamara.gomes@br.gt.com 03/04/2020
Bulgaria Yes. The initial deadline for tax return submission was set to 30 April. Currently it is extended until 30 June. Yes. The initial deadline for tax return submission was set to 30 April. Currently it is extended until 30 June. Announcements on employer and employee related tax, social security and payroll developments are related to those companies which will apply for the state aid of so called 60/40 mechanism. Employers may grant up to one-half of the paid annual leave without the consent of their employees or workers. Employers may issue an order to assign work from home or telework to their workers and employees without their consent. The employer may establish in the enterprise or its unit a part-time work for the full-time employees and workers for the whole or part of the state of emergency period. In the event of a state of emergency, the employer may issue an order to suspend the work of the entire or part of the enterprise or of individual employees for the whole or part of the period (until the state of emergency is lifted). When a state of emergency is declared, and all or part of the entity's operations are suspended by order of state authority, the employer is obliged not to admit the employees or workers to their workplaces for the period determined in the order. In such cases, during the period when the work is suspended the employee or worker is entitled to their gross remuneration. State support for employers during a state of emergency should include the full amount of workers compensation benefits under the 60/40 scheme. There are two categories identified of eligible employers. The first is those of the specific sectors of the economy concerned that, have not, at their discretion, terminated the work of the whole enterprise or part of it, or of individual employees. The second category is employers from all sectors of the economy, with some exceptions, which, because of the state of emergency, have stopped the work of all or part of the enterprise or individual workers, or have introduced reduced working hours. The condition for this second category is to certify a 20% decrease in their revenue. An employer who, because of a state of emergency, has issued an order suspending the work of all or part of the enterprise, as well as of individual employees, provided that he meets the other conditions of the decree, may apply for compensation of 60% of the January insurance income of all terminated workers, plus the full amount of the insurance benefits he owes to the gross wages of the workers concerned. His commitment remains at the rate of the remaining 40% of these workers' salaries to the full extent. If he does not, he owes a refund to the funds received. Compensation shall be paid for the period of emergency, but not more than three months. Emilia Marinova - emarinova@bg.gt.com and Victor Bakalov - vbakalov@bg.gt.com 08/04/2020
Cambodia No No Updates will be forthcoming. Ronald C. Almera - ronald.almera@kh.gt.com 01/04/2020
Canada Yes, further extended to September 30 Yes, further extended to September 30 (including instalment payments) Where an individual has remained in Canada solely because of the Travel Restrictions limiting movement due to COVID-19, the CRA will not consider the common-law factual test of residency to be met. In addition, as an administrative matter and in light of these extraordinary circumstances, the Agency will not consider the days during which an individual is present in Canada and is unable to return to their country of residence solely as a result of the Travel Restrictions to count towards the 183-day limit for deemed residency. This will be the Agency position where, among other things, the individual is usually a resident of another country and intends to return, and does in fact return, to his or her country of residence as soon as he or she is able to do so. Canada Revenue Agency - Extended filing and payment deadlines: The CRA is further extending the payment due date for 2019 individual tax returns as well as for instalment payments, from September 1, 2020, to September 30, 2020. The previously-extended filing due dates for individual income tax returns remain unchanged. The CRA encourages everyone to file their income tax returns as soon as possible, even though payment deadlines are being extended. However, recognizing the difficult circumstances faced by Canadians, the CRA will not charge late-filing penalties where a 2019 individual return is filed late as long as it is filed by September 30, 2020. The extensions to the filing due date for income tax returns detailed above also apply to form T1135, and any elections, forms, and schedules that must be filed with the return. Revenu Quebec - Extended filing and payment deadlines: For individuals, the deadline for paying an income tax balance for 2019 has been extended from September 1 to September 30, 2020. If an individual is required to make instalment payments, the June 15 and September 15 payments can be made as late as September 30, 2020. Since the deadline for paying an income tax balance has been postponed to September 30, 2020, an individual will not be charged a late-filing penalty if he files his income tax return by September 30, 2020. However, he should still file his income tax return promptly to receive the amounts he is entitled to. Quebec: Martin Caron - caron.martin@rcgt.com and Toronto: Christine Herrington - christine.herrington@ca.gt.com 18/08/2020
Czech Republic Yes, 4,5 months to 18 August 2020 Yes, 4,5 months to 18 August 2020 PIT filing and payment postponement: The filing and payment deadline was extended until 18 August 2020 for all personal income tax returns. If taxpayers do not file a tax return and pay the tax by 18 August 2020, penalties for late filing and late payment will be calculated from the beginning of the statutory period, ie from 1 April, or 1 July until the date of submission or until the date of payment. SSHI payment postponement for employers: The employers are allowed to postpone payment of social security contributions for the calendar months of May, June and July 2020 until 20 November 2020. If the employer makes payment of these contributions within this period, it will only pay a decreased penalty of 0.01% (instead of ordinary 0.05%) for each day of late payment. This measure only applies to social security contributions paid by the employer whereas the obligation to deduct and pay contributions for employees remains. Waiver of SSHI payment for employers: This measure allows employers with up to 50 employees to waive payments of social security contributions to be paid by the employer for June, July and August 2020. In order to apply this measure, employers must employ at least 90% of their employees in the given calendar month as compared to 31 March 2020 (in terms of the number of employees and the sum of their assessment bases) as well as to deduct and pay social security contributions on behalf of their employees. Waiver of SSHI advance payment for self-employed: The waiver of the advance payments of social security and health insurance contributions for 6 months (from March to August 2020) for freelancers, which must pay the minimum advance payments. Antivirus Program: Based on the so-called Antivirus Program, the Czech government will pay compensation to employers in the amount of 60 - 80 % of net salaries of their employees due to restrictions on production or services related Covid-19. The amount of contribution depends on reason of restriction. Tax loss carryback: Based on the so-called tax loss carryback mechanism, personal income taxpayers will be able to carryback the loss for the tax period of 2020 in the tax return for 2018 or 2019 in the form of an additional tax return for these previous tax periods. Other measures: The tax authorities confirmed that taxpayers are entitled to file requests for postponing of certain tax payments, requests for reduction of quarterly or semi-annual income tax advances, requests for waiver with respect to late-filing and late-payment penalties. The fees related to the submission of the requests are waived automatically. Roman Burnus - roman.burnus@cz.gt.com 28/08/2020
China No No If an employee will not be present in China for 90 days this year, is not paid from and does not have their employment income borne by a China entity, it may be possible to have their income excluded from China individual income tax. If one of the criteria is not met, an employee's China-paid salary should still be subject to be taxed in China. Relief under this arrangement for international companies should be reviewed as a potential mismatch in cost allocation could trigger a Permanent Establishment to be created in China, exposing the foregin entity to wider China corporate, employer and employee tax obligations. David Dawei-Luo - david.dawei.luo@cn.gt.com and Sherry Chen - sherry.chen@cn.gt.com 24/08/2020
Denmark Yes, postponed to 1 September 2020 (from 1 May or 1 July) Yes and no. Tax due for calendar year 2019 due after 1 July, still a penalty of 4%. If tax due less than 2,900 Euro it will not be included in the preliminary tax for 2021, if pays before 1 September - postponed from 1 July. The 2019 tax filing and payment deadlines of 1 May (employed) and 1 July (employed, includes foreign income) still apply. The employer obligation to filing salary and withholding tax returns is also the same, however the payment of withholding tax on salary for the months of April, May and June has been postpone to 10 September, 12 October and 10 November. Laerke Hesselholt - laerke.hesselholt@dk.gt.com 01/04/2020
Estonia No No Employers are not required to pay a minimum amount of social tax in March, April and May for their employees if the employee is on unpaid leave or working part-time. Tax arrears can be paid in instalments as before, however the interest rate can be reduced up to 100%. Kristjan Jarve - kristjan.jarve@ee.gt.com and Urzula Valb - urzula.valb@ee.gt.com 31/03/2020
France Yes, deadline extended beyond 4 to 11 June (depending on where an individual resides). Extension deadline has yet to be confirmed. No French Government announced that non-resident individuals present in France due to lockdown or travel bans should not have their tax residency status impacted. If their stay in France is temporary and only due to force majeure such as lockdown or travel bans, it is not sufficient to consider them as tax residents of France. However, if someone stayed in France on a voluntary basis because his employer encouraged homeworking, this could change the residency status. In addition, agreements have been signed between France and Germany, Belgium, Switzerland, and Italy specifically on cross-border workers (who are taxed according to a specific regime). Those agreements specify that employees who benefit from the cross-border regime will not be impacted by days worked from home in France and they will continue to benefit from the cross-border tax regime. Those days will be considered as worked in the border area of the State where the activity is usually performed (ie where the employer is located). There are also agreements between France, Germany, Belgium, Switzerland, Italy and Luxembourg regarding workers that are tax residents of one country and work in another country (but who do not qualify as 'cross-border'), days during which they had to work from home will be taken into account as days worked in the country where they would have normally exercise their professional activity. Those agreements apply from mid-March (exact date depending on the country) and currently up to the end of August. Anne Frede - AFrede@avocats-gt.com 28/08/2020
Germany Yes, extended to 31 May 2020 for 2018 returns, with conditions Yes, by application The 2018 tax return filing extension applies for employees in specific federal states (eg Hessen, Rhineland-Palatinate, Bavaria) and for taxpayers who are advised by a German Tax Advisor. For the payment extension, the deferment can apply to the payment of income tax prepayments or final income tax payments. Interests should not be due on the deferred payment. Wage tax filings still need to be made and wage tax still need to be withhold and paid by the employer. A deferment of payment for wage tax purposes is principally not possible. However, in some cases an application for deferment of wage tax payments was already successful, although there is no legal basis for this application. Social Security amounts can be deferred upon application, if other supporting measures are exhausted. Additionally, income tax prepayments can be reduced upon application if income tax prepayments were and a refund is likely. Germany introduced short term working rules. However for expatriates a case by case evaluation needs to be made, whether or not they can benefit from the German regulation. More general comments on the short time workings rules can be found under: https://www.wkgt.com/en/insights/corona-short-term-work/?hubId=1773612. Employers can pay their employees bonuses or provide them with a benefit in kind up to an amount of EUR 1,500 tax-free. This covers special benefits that employees receive between 1 March 2020 and 31 December 2020. The precondition is that the allowances and benefits are paid in addition to the wages owed in any case. It may be possible to pay a one-off child bonus for 2020 in the amount of EUR 300, which will be treated in the same way as child benefit for tax purposes. The child bonus should be paid out in full if a child is entitled to child benefit for at least one month. Germany has agreed with Belgium, Luxembourg, Austria, France and the Netherlands to ease tax treaty restrictions on the number of days cross-border workers are allowed to work from home amid the new coronavirus pandemic. The agreement applies to working days in the period from 11 March 2020 to 31 May 2020. After 30 May 2020, the agreement is automatically extended from the end of one calendar month to the end of the next calendar month or in case of Belgium by agree in writing one week before the beginning of the following month (in case of Belgium last extension agreed: until 31 August 2020). Therefore, days worked from home since 11 March won't be added to the end-of-year calculations. They count as days worked in the usual country of employment. The Federal Ministry of Finance has published a consultation agreement between Germany and Switzerland dated 12 June 2020. The agreement regulates the taxation of short-time working allowances and of cross-border commuters to Switzerland and provides relief for employees working across borders. The period during which an employee is restricted by Covid-19 pandemic measures shall not be taken into account in the assessment of cross-border worker status. For this reason, a proportional reduction of the limit of 60 working days (as per DTT ) by 60/366 for these working days must be made for the remaining period of the calendar year. In addition, days for which wages are received and on which workers carry out their work in the state of residence only as a result of the Covid-19 measures can be claimed as working days spent in the state in which the place of work would have been located without the measures. Short-time work compensation for lost working hours, which is reimbursed on the basis of the Covid-19 measures, must be qualified as compensation for employment (as per DTT) and is taxable in the state which provides the compensation. The agreement applies to remuneration for the period from 11 March 2020 to at least 31 August 2020. Its validity is extended thereafter from the end of each calendar month to the end of the next calendar month, unless it is terminated by the competent authority of one of the contracting states at least one week before the beginning of the following calendar month by written notification to the competent authority of the other contracting state. Marco Schader - marco.schader@wkgt.com 18/08/2020
Hong Kong (China) Yes, to August 17 Yes, individuals paying Salaries Tax will be allowed to delay payment by three months on payments due between April and June. The IRD has further announced that deadlines for tax payments, lodgement of objections and holdover applications, and submission of tax returns and information that fall between July 20 and August 16 will be automatically extended to August 17, 2020. Under the $80 billion Employment Support Scheme (ESS), the Government will provide wage subsidies to eligible employers to retain their employees in return for employers undertaking not to implement redundancy. The government subsidies are calculated on the basis of 50% of wages, subject to a wage cap of HK$18,000 per month for a period of six months. Payment will be made to employers in two tranches, with the first pay out no later than June. William Chan - william.chan@hk.gt.com and Anthony Chan - anthony.chan@hk.gt.com 18/08/2020
Hungary No No Special tax exemptions are applied to the employers operating in the most impacted industries. Such employers are exempted from the payroll taxes, and only a 4% in-kind health insurance contribution (capped at monthly HUF 7,710) should be deducted from their employees' salaries. Subsidies related to reduced working time are available for a wide range of employers for any part-time work that is at least 25%, but not more than 85% of the original working time. The amount of the subsidy is 70% of the proportionate part of the base wage for the lost working time, capped at the two-fold amount of the minimum wage. A special form of subsidy is available for the employers whose employees are engaged in R&D activities. In case of unpaid leave, from 1 May 2020 the employer should file returns and pay the healthcare service contribution (HUF 7,710 per month) instead of the employee. For in-kind benefits provided via SZEP Cards in the period between 22 April and 30 June 2020, the tax burden is reduced from 32.5% to 15%. As a general tax-reducing provision, from 1 July 2020, the rate of the social contribution tax is reduced from 17.5% to 15.5%. Timea Zednik - timea.zednik@hu.gt.com 24/04/2020
India Yes Yes The Indian filing deadline for 2018/19 tax returns (revised/unfiled) will be extended from 31 March 2020 to 30 June 2020. All appeals, notices, intimations, orders, etc which were required to be filed/issued/complied with by the taxpayers or revenue authorities where the time limit expires between 20 March 2020 and 29 June 2020 shall be extended to 30 June 2020. For delayed payments of advance tax, self-assessment tax, regular tax, tax deducted at source (TDS), tax collected at source (TCS) made between 20 March and 20 June 2020, interest applies at a reduced rate of 9% per annum (instead of 12%) for this period. The government announced on May 18, 2020 that Provident Fund contribution rates would be reduced for 3 months covering May to July. Employer contributions fall from 3.67% to 1.67%, while employee contributions fall from 12% to 10%. This will provide a welcome easing of liabilities, though does ultimately reduce the accrued saving in an individual's Provident Fund account. Rajashree Sarna - rajashree.sarna@in.gt.com and Akhil Chandna - akhil.chandna@in.gt.com 20/05/2020
Italy Yes, extended to 30 September Yes, extended to 31 May The social security authorities have confirmed that A1 certificates issued under articles 11 and 12 of the EU Reg. 883/2004 - will be extended automatically to July 31 2020 where the deadlines fall between January 31st and July 31st, 2020 and the employee remains present in Italy during the pandemic. No application needs to be filed to obtain the extension. Additionally article 13 of Reg. 883/2004 provides for the social security of the country where the employee is tax resident to apply, if the employee undertakes 25% or more of their working activity there. Given current travel limitations, employees may be required to work in a country other than the one they are tax resident in. Accordingly they can continue to contribute in Italy if it is their resident country even if working time falls below 25%.Tax withholding and related obligations are suspended throughout Italy for a defined period for employers. Further updates are expected. Tax payments falling between 8 March and 31 May 2020 are suspended, except for the filing of the CU (Certificazione Unica) 2020. Indeed, Deadline and payments will be due by 30 June with no penalties applied. The social security authorities have confirmed that A1 certificates issued under articles 11 and 12 of the EU Reg. 883/2004 - will be extended automatically to July 31 2020 where the deadlines fall between January 31st and July 31st, 2020 and the employee remains present in Italy during the pandemic. No application needs to be filed to obtain the extension. The social security authorities have confirmed that A1 certificates issued under articles 11 and 12 of the EU Reg. 883/2004 - will be extended automatically to July 31 2020 where the deadlines fall between January 31st and July 31st, 2020 and the employee remains present in Italy during the pandemic. No application needs to be filed to obtain the extension. Additionally article 13 of Reg. 883/2004 provides for the social security of the country where the employee is tax resident to apply, if the employee undertakes 25% or more of their working activity there. Given current travel limitations, employees may be required to work in a country other than the one they are tax resident in. Accordingly they can continue to contribute in Italy if it is their resident country even if working time falls below 25%. Lorenzo Carminati - lorenzo.carminati@bgt.it.gt.com and Paola Lova - paola.lova@bgt.it.gt.com 21/04/2020
Ireland No No The tax authorities have arranged a range of measures to ease regulations for internationally mobile employees and their employers. Foreign employments - Operation of Irish PAYE: Irish shadow payroll obligations for foreign employers where an employee was working abroad for a foreign entity prior to COVID-19 but relocates temporarily to the State during the COVID-19 period and performs duties for his or her foreign employer while in the State. This relief applies only to genuine cases. The standard period for relief from Irish payroll taxes for short term business travellers to Ireland was 60 days in a calendar tax year for residents from countries with which Ireland has a double tax agreement and 30 days for non-tax treaty residents. Irish Employments - PAYE Exclusion Order: For non-resident employees who are working abroad for an Irish employer for whom a PAYE exclusion order is in place, the position will not be adversely impacted where the employee works more than 30 days in the State due to COVID-19. Trans-Border Workers Relief: This relief can provide relief from Irish tax on a foreign employment exercised wholly outside Ireland in a tax treaty location, (eg the UK) once certain conditions are met. These conditions include that the employee returns home at least one day per week and does not perform more than incidental duties of the foreign employment in Ireland. Revenue guidance confirms that days spent working at home in Ireland due to COVID-19 will not preclude the individual from being entitled to claim this relief provided all other conditions of the relief are met. Costs of assisting employees returning to the State including payment of holiday/flight cancellations: Provided the employee is integral to the business and was required to return to deal with issues related to the COVID-19 crisis by his or her employer, the costs incurred are reasonable and the employee is not otherwise compensated (ie via an insurance policy or direct claim to the service provider), a benefit in kind will not arise. This may include costs related to family members who were on holiday or due to go on holidays with the employee. Residence rules - Force Majeure circumstances: the individual will not be regarded as being present in Ireland for tax residence purposes for the day after their intended day of departure provided the individual is unavoidably present in the country on that day due only to force majeure circumstances, including COVID-19. Special Assignee Relief Programme (SARP): The 90 day employer filing obligation, is extended for a further 60 days. It is anticipated that such an extension should provide sufficient time for employers to file the required return, but exceptional cases may be submitted to Revenue for consideration on a case by case basis. PAYE Dispensation Applications: Given the unprecedented circumstances and the restrictions on travel as a consequence of COVID-19, Revenue will not strictly enforce the 30 day notification requirement for PAYE dispensations which is applicable to short term business travellers from countries with which Ireland has a double taxation treaty who are going to spend in excess of 60 workdays in the State in a tax year. Share schemes filing obligations: The filing deadline for all 2019 share scheme returns is being extended from 31 March 2020 to 30 June 2020. Jillian O'Sullivan - jillian.osullivan@ie.gt.com and Jane Quirke - jane.quirke@ie.gt.com 24/03/2020
Isreal Yes, 2 months Yes, 2 months Unpaid Vacation: In accordance with Social Security guidelines, an employee may be entitled to unemployment benefit if the employer has placed them vacation (unpaid) for a period of 30 days or more, or if they are fired following the impact of the pandemic. An employee whose job has been reduced or has been in isolation for two weeks is not entitled to unemployment benefit. The unpaid vacation conditions are in accordance with the normal unemployment conditions set in Israel. Igal Manasherov - Igal.Manasherov@il.gt.com 14/05/2020
Japan The tax authorities have confirmed they will accept returns filed after 17 April as being timely submitted if the taxpayer can demonstrate the delay is due to the COVID-10 pandemic. The tax authorities have not confirmed whether payments made after the extended deadline will accrue interest. It would be advisable for taxpayers to pay by the extended deadline. The government announced that all individual with their address registered on the Resident Register will be eligible to receive a non-taxable grant of JPY 100,000 grant. There will be no income limitation on the grant and so is available to all residents, however the government may allow people to voluntarily opt-out. Application will likely be available online instead of requiring physical attendance. Foreign nationals with visa a duration of more than 3 months are legally required to register themselves with the Resident Register, therefore, many expats working in Japan will be eligible for the grant. Tosh Kamii - tosh.kamii@jp.gt.com and Nicole Baxter - nicole.baxster@jp.gt.com 21/08/2020
Korea No Yes, to 31 August 2020 There are no specific announcements at the moment. Kwangil Ahn - kwangill.ahn@kr.gt.com 18/08/2020
Malaysia Yes, two months Yes, two months Tax Residence in Malaysia - a tax resident individual who is temporarily absent from Malaysia because of COVID-19 travel restrictions shall have the period of temporary absence from Malaysia due to that travel restriction taken into consideration as if they were in Malaysia, for determining tax residence in 2020. An individual who is not tax resident in Malaysia, who is temporarily present in Malaysia because of COVID-19 travel restrictions, can exclude the period of temporary presence there for the purpose of determining 2020 tax residence status. Relevant documentation and records must be retained for inspection if requested by the Malaysian tax authority. Permanent establishment (PE) - The Malaysian tax authority will consider the temporary presence of employees in Malaysia as a result of COVID-19 travel restrictions to not result in the creation of a corporate taxable presence, a PE, in Malaysia, provided it meets the following criteria: The company does not have a PE in Malaysia prior to the COVID-19 travel restrictions; There are no other changes to the economic conditions of the company; The temporary presence of personnel in Malaysia is solely due to the COVID-19 restrictions COVID-19 travel restrictions; The activities performed by the personnel during their temporary presence would not have been performed in Malaysia if not for the COVID-19 travel restrictions. Relevant documentation and records should be retained for inspection if requested by the Malaysian tax authority. The deadline to file a tax return for individual taxpayers (who are not self-employed) was extended from 30 April to 30 June. The Central Bank has also issued a moratorium for affected individuals to delay the repayment of existing loans, including mortgages, for a period of six months. This deferment, however, only applies to individuals whose loans/financing are not in arrears exceeding 90 days as at 1 April 2020. Employees contribution to statutory social security has been reduced from 11% to 7% for the period from April to December 2020. Daniel Woo - daniel.woo@my.gt.com 21/08/2020
Mexico Yes, to June 30, 2020 (from April 30, 2020) Yes, to June 30, 2020 or pay over 6 instalments if the 2019 tax return is filed by April 30, 2020 and first instalment paid by then A range of payroll tax deferrals, subsidies and forgiveness have been granted locally by different States. These vary from state to state and employers should review those applicable to ensure appropriate compliance. Carlos Alfonso Hernandez Perez - carlos.a.hernandez@mx.gt.com 29/04/2020
Netherlands No Yes, with approval There are reduced provisional assessments of income tax. Niels Dekker - niels.dekker@nl.gt.com and Maria Mulder - maria.mulder@nl.gt.com 16/03/2020
New Zealand Discretionary (no statutory extension) Discretionary to cancel interest and penalties for late payments if CONVID-19 related Wage subsidies for affected businesses and isolated employees for 12 weeks; the threshold for provisional tax increased to $5,000 (this is the interim tax to be paid towards the end of year bill from non-withholding tax sources). Greg Thompson - greg.thompson@nz.gt.com 16/03/2020
Nigeria Yes, state only Yes, state only State Internal Revenue Service (SIRS): Out of the thirty six SIRSs in Nigeria only the Lagos State Internal Revenue Service (LIRS) and the Federal Capital Territory Internal Revenue Service (FCT IRS) have extended the deadline for filing of annual returns for individual taxpayers for two and three months respectively, ie 31 May 2020 and 30 June 2020. This extension is due to the Coronavirus (CONVID-19) pandemic, which has affected individuals and organisations. The Federal Inland Revenue Service (FIRS) has extended the deadline for filing of company income tax returns by one month, ie 31 July 2020. Nkwachi Abuka - nkwachi.abuka@ng.gt.com and Ajayi Irivboje - ajayi.irivboje@ng.gt.com 31/03/2020
Norway No No A number of measures have been announced by the Norwegian authorities to support cash management and liquidity including: Reduced the mandatory employer payment period from 15 to 2 days on termination, as well as removal of waiting days. The mandatory employer period for payment of sick-pay related to the corona pandemic is reduced from 16 days to 3 days. It has been proposed that employer's national insurance contribution rate will be reduced by 4 % for two months from 14.1% to 10.1%. The deadline for payment of the employer's national insurance contribution is postponed from 15 May to 15 August 2020. Tax exemption for some benefits in kind provided as a result of the COVD-19 pandemic, such as internet access, mobile phone. Lars Ploen - lars.ploen@no.gt.com 13/04/2020
Philippines Yes, to 14 June Yes, to 14 June As a result of the community quarantine in place earlier in the year, the authorities extended the deadlines by 2 months following monthly review. In cases where restrictions imposed by COVID-19 pandemic affect the applicability of Philippine tax laws and tax treaties on taxpayer's tax position, the following rules shall be considered: Tax Residency - Individuals prevented from leaving the Philippines on their scheduled day of departure because of the travel restrictions imposed by the government will not be regarded as being present in the Philippines for the period after the scheduled day of departure. The said individuals should leave the Philippines as soon as the travel restrictions and/or quarantine measures have been lifted. Individuals who are supposed to be in the Philippines under a contract but were not able to travel to the Philippines due to travel restrictions will be considered present in the Philippines for tax residency purposes. Creation of permanent establishments (PE) - Employees of foreign enterprise who are working from home in the Philippines in compliance with government's home quarantine measures would not create a PE of the foreign enterprise in the Philippines. However, if an employee's home is used as continuous basis for carrying business activities of the foreign enterprise even after the COVID-19, it may be considered a PE of the foreign enterprise. Temporary interruptions of construction activities due to COVID-19 should be included in computing the duration of a site in determining whether such construction site constitutes a PE. Where an employee, partner or agent of a foreign enterprise, who are not habitually concluding contracts on behalf of a foreign enterprise before the COVID-19 crisis, continue to be present in the Philippines due to travel restrictions related to COV1D-19, such presence in the Philippines shall be disregarded in counting the period of stay or presence of the foreign enterprise in the Philippines. In order to prove that extended presence in the Philippines was due to COVID-19-related travel restrictions, records shall be maintained outlining the circumstances and submitted to the BIR in support of the taxpayer's application for relief from double taxation. Due to the general community quarantine being implemented by the government, P&A Grant Thornton employees are currently working from home. For immediate concerns, you may reach us through our mobile numbers below. Lina Figueroa - lina.figueroa@ph.gt.com 24/08/2020
Portugal No Yes The government has introduced a number of measures to support employers and employees including financial support for employees who must stay at home to accompany their children up to 12 years old, totaling 66% of basic remuneration (33% paid by the employer, 33% paid by Social Security). Pedro Ferreira Santos - pedro.santos@pt.gt.com 24/03/2020
Puerto Rico Yes, to July 15 Yes, to July 15 Industries that can operate: security, health, food, utilities, ports, airports, press, first responders, hardware stores, auto repair shops, gas stations, banks and financial services, laundries, laundromats, repairs and maintenance services, funeral homes for limited services, utilities and infrastructure services, export of merchandise, carriers, data centers, call centers, legal, accounting and other professional services, construction and manufacturing. Under US relief provisions, employers will pay up to two weeks sick leave and up to 12 weeks of Family Leave, employers will take credit for amounts paid. Small Business Administration loans under Payroll Protection Program based on payroll with possibility of forgiveness. Loan payment extensions provided by some financial institutions, vary by institution, must contact bank directly. Lina Morales - lina.morales@pr.gt.com 08/05/2020
Russia Yes, by 3 months to 30 July No, payment deadline remains 15 July The Russian government announced that for tax year 2020, taxpayers who spend more than 90 days in Russia but fewer than 183 days, may apply to be treated as tax resident in Russia. This would have the effect of being subject to tax at 13% rate rather than the 30% tax rate applicable to tax non-residents. Additionally, Russian tax residents are eligible to take tax deductions associated with certain expenses including the purchase of property in Russia, medical treatment and education costs. From 1 April, small and medium enterprises (in accordance with registry) are allowed to apply decreased rates of social insurance contributions to the part of an employees remuneration that exceeds the minimum wage. The decreased rates are as follows: obligatory pension insurance contributions - 10%; obligatory social insurance contributions - 0%; obligatory medical insurance contributions - 5%. Refunds will be provided in respect of Tax on Professional Income which is payable by self-employed individuals under a special regime. The full amount of Tax on Professional Income paid in 2019 calendar year shall be paid back to taxpayers. Additionally, self-employed individuals are provided with subsidy in amount of RUB 12,130 which can be offset against liabilities in respect of tax on professional income. Liliya Yulgusheva - liliya.yulgusheva@fbk.ru 13/08/2020
South Africa No No Treasury made provision for the expansion of the Employment Tax Initiative (ETI) programme for a limited period of four months, beginning 1 April 2020 and ending on 31 July 2020 as follows. Increasing the maximum amount of ETI allowable during this four month period for employees eligible from R1000 to R1500 in the first 12 qualifying twelve months and from R500 to R1 000 in the second twelve qualifying months. Allowing a monthly ETI claim in the amount of R500 during this four month period for employees from the ages of 18 to 29 who are no longer eligible for the ETI as the employer has claimed ETI in respect of those employees for 24 months; and 30 to 65 who are not eligible for the ETI due to their age. Accelerating the payment of employment tax incentive reimbursements from twice a year to monthly as a means of getting cash into the hands of tax compliant employers as soon as possible. The proportion of PAYE that can be deferred by employers, without SARS imposing administrative penalties and interest for the late payment thereof, is increased from 20% to 35% for businesses with an annual turnover of less than R100 million. Businesses with a turnover of more than R100 million can still apply for deferment of payment, however the application will be considered on a case by case basis. Azwinndini Magadani - Azwinndini.Magadani@sng.gt.com 12/05/2020
South Korea No Yes, to 31 August, 2020 from 1 June None for Individual. Corporations with locations in special disaster zones extend the filing and payment deadline for corporate tax (March Reporting Corporation) and VAT reporting for one month. Kwangil Ahn - kwangill.ahn@kr.gt.com 24/03/2020
Singapore Yes. Extended to 31 May 2020. Grant Thornton Singapore has extended all its clients' tax returns to 30 June (which IRAS have further extended to 15 August) as they can do this on an annual basis. Yes. Tax is only due once a notice of assessment (tax bill has been raised). Employees can request a deferment of any tax payments due in April/May and June IRAS have announced the relaxation of a number of rules related to individuals who are unable to travel as a result of travel restrictions. These include rules on the tax residence of companies, Singapore permanent establishment risks and taxability of employees stuck in Singapore arising from travel restrictions. There are different rules for different groups of people and so we would recommend advise is sought to ensure that your employees meet the various conditions or whether you have to continue considering the normal domestic tax rules and relevant double taxation agreements. Employers are responsible for all new and existing foreign employees. More information can be found in the following link - https://www.mom.gov.sg/covid-19 Adrian Sham - adrian.sham@sg.gt.com 08/06/2020
Spain No No Employers in urgent need to adjust their workforce, have a tool provided by existing Spanish labour regulations, which are the Temporary Employment Regulation Proceedings also known as 'ERTE'. A tool that already existed but now has been simplified. An ERTE is an administrative procedure allowing employers to suspend employment contracts or reduce working hours temporarily, in response to temporary economic, organizational, technical or productive adverse circumstances affecting their activity. The ERTE can be justified for economic, technical, organizational and production reasons which under certain circumstance may be invoked in the current situation of COVID 19. While the ERTE due to COVID 19 is in force, employees will remain registered for Social Security purposes and a subsidy is paid by Spanish authorities, so the Company does not pay their salary during the period of suspension of the employment contracts or reduction of the working hours. The authorities announced on 31 March that small businesses may postpone payment of Social Security contributions relating to the period April to July until a later date. The Spanish tax authorities announced on 14 April that filing of withholding tax (WHT) returns and payment of tax normally due between 15 and 20 April has been extended to 20 May. This applies only to businesses with an annual turnover of EUR600,000 or less. Pablo Azcona - pablo.azcona@es.gt.com and Manuel Alvarez Ferrer - manuel.alvarez@es.gt.com 12/05/2020
Sweden No (Respite to file individual tax returns are granted for individuals with bureau assistance until 15 June, regardless of the method for filing). No Preliminary tax on salary from 1 January 2020 to March 2020 could be refunded. The taxes should be repaid, including interest, by the taxpayer within 12 months. Companies with larger tax debts and historic financial issues are excluded. These measures are proposed to be applied retrospectively from 1 January 2020. Employers social security contributions for businesses with up to 30 employees are to be lowered between 1 March and 30 June 2020. Further, the government is proposing to support an amount of an employer's salary costs if an agreement of reduced working hours is made between the employer and the employee. The government is further proposing to temporarily take over the responsibility for all sick pay costs during April and May 2020. Helena Lindahl - helena.lindahl@se.gt.com 02/04/2020
Switzerland If the taxpayer requested a filing deadline extension for the 2019 Swiss tax return which has not yet expired, a deadline extension until 30 November 2020 (or even longer in some cantons) may be discussed with the competent authority on an individual basis. No (However, this can most likely be discussed on an individual basis with the competent tax authority (extension of deadline/agreement of payment in installments) The maximum period for the payment of short-time working compensation has been increased from 12 months to 18 months. Closure of companies by the authorities or loss of work or earnings due to the coronavirus are generally covered by short-time work compensation. Employers must provide a plausible explanation why the loss of work or revenue to be expected in their company is caused by the coronavirus. People with a multinational employment set up (e.g. cross-borders, international weekly commuters, assignees etc.) working from their home office in another country than where their employer is based shall seek advice from their tax consultant regarding the impact on the taxation of workdays. Different approaches and workday counting methods may apply depending on the canton where the taxpayer is tax resident and the applicable double tax treaty between the home country and the host country of work. The waiting period for the payment of short-time working compensation is reduced to one day until 30 September 2020. Closure of companies by the authorities or loss of work or earnings due to the coronavirus are generally covered by short-time work compensation. Employers must provide a plausible explanation why the loss of work or revenue to be expected in their company is caused by the occurrence of coronavirus. An emergency ordinance passed by the Federal Council on the granting of loans with joint and several guarantees provides companies affected by the consequences of the coronavirus with guaranteed bridging loans of up to 10 percent of their turnover, or a maximum of CHF 20,000,000. Bernhard Lauri - Bernhard.lauri@ch.gt.com and Anthony Haug and anthony.haug@ch.gt.com 13/08/2020
Taiwan Yes, to 30 June Yes, to 30 June If based on mutual agreement, working hours for an employee are reduced by more than 16 hours for every two weeks, the employee can join the Government sponsored training program. If the employee participates in this program, the employee can receive a government subsidy of up to TWD18,960 per month. Alternatively, the employee can choose not to attend the training program but apply for 'cut-back on working hours subsidy' for up to TWD 11,000 per month. If an employee is under quarantine and the employer continues to pay the employee salary in full, the employer can claim double the salary expense amount for the employee as tax deductible item for tax purpose. For hotel, retail, restaurant and other commercial services businesses, the Taiwan government may subsidize 40% of employees' salaries capped at TWD 20,000 per month per person for 3 months subject to certain preconditions. These include no lay off of employees, no salary cut in excess of 20%, and proof total sales has declined by more than 50%. If an employer hires unemployed individuals aged between 15 ~29 and they meet certain conditions, the employer can receive a Government subsidy amounting to TWD 36,000 to TWD 108,000 per employee. Jay Lo - jay.lo@tw.gt.com 13/08/2020
Thaliand Yes, extended from 31 March to 30 June Yes, extended from 31 March to 30 June No employer indicatives have yet been announced but the government is discussing possible measures. Melea Cruz - melea.cruz@th.gt.com 14/04/2020
Turkey Yes, between 27 June 2020 and 27 July 2020. Depending on relevant sector and other details (Force majeure provisions) according to their sectors. Yes, between 02 November 2020 and 31 December 2020 depending on conditions. As the pandemic is regarded as a force majeure-event,the employees and employers working in the following sectors are eligible to benefit from the force majeure provisions: Retail (including shopping centres); healthcare services; furniture manufacturing; the iron, steel and metal industry; mining and quarrying; building construction services; industrial kitchen manufacturing, automotive manufacturing and selling; manufacturing of parts and accessories for the automotive industry; car rental; logistics and transportation (including warehousing activities); artistic activities such as cinema and theatre; publishing and printing materials such as books, newspapers; accommodation (including tour operators and travel agencies); food and beverage services including restaurants and coffee shops; manufacturing and trading textiles and apparel; and events and organizations, including public relations. Those eligible beneficiaries can be defined as; a) Individuals who are liable to pay income tax due to their commercial, agricultural or self-employment activities b) Employers directly affected by the COVID-19 pandemic and engaged in the above-mentioned sectors, c) Taxpayers engaged in businesses where operations have been suspended as part of the COVID-19 measures imposed by the Ministry of Internal Affairs. The authorities have announced that Social Security taxes and premiums have been postponed for sectors covered by force majeure provisions for people over 65 years old and for those with chronic conditions. With this decision, employers can pay the premiums of their workers for March, April, May in November and December. Other supports provided by the authorities are, Short term working grants for 3 months for the employers starting from March. The main purpose here is avoiding unemployment of the current employees and may be extended for 3 more months. Minimum Salary Support can be provided to Employers with private sector workplaces, Employers of other public offices other than the public administrations mentioned in table 1 attached to the Law No. 5018. Besides the following conditions are sought in the employees; Ought to be in the form of being insured in the long-term insurance branches within the scope of subparagraph (a) of paragraph 1 of the article 4 of the law numbered 5510. Minimum Wage Support can be provided until the end of the year. For 2020 daily premiums for businesses registered before 2020 are 128 TL, and for businesses belonging to private sector employers with a collective agreement are 256 TL. emin.taylan@tr.gt.com 28/05/2020
United Kingdom No Yes, only applies to 2nd 2019/20 Payment on Account due 31 July 2020 which has been extended 6 months to 31 January 2021. HMRC have recently issued FAQs confirming their position in relation to individuals displaced from their normal location due to COVID travel restrictions. They confirmed that individuals prevented from leaving the UK in certain circumstances, as a result of COVID may consider these days in the UK as 'exceptional circumstances' and exclude up to 60 days per tax year for certain parts of the residence test. However, please note that this only impacts domestic residence, days spent in the UK working will still be considered UK workdays for sourcing purposes and may be taxable unless treaty conditions are met. HMRC also confirmed that there is no change to how days are counted for the purpose of the 183 day test under the treaty. The Coronavirus Job Retention Scheme (previously set up to enable employers to apply for a grant to claim 80% of furloughed employees usual wage costs) will close on 31 October 2020 with reductions in the level of grant which can be claimed between 1 August and close date. No new employees can be furloughed. There have been no further extensions to compliance deadlines for personal and employment tax purposes in the UK. Katy Bond - katy.bond@uk.gt.com and Heather Smallwood - heather.smallwood@uk.gt.com 18/08/2020
United States Yes, 90 days Yes, 90 days In addition to extensive legislation for employers, the tax filing and payment deadline for April 15 has been pushed back by 90 days to 15 July. Richard Tonge - richard.tonge@us.gt.com 16/03/2020
Vietnam No No Under the recently issued regulations, from July 2020 onwards, tax reliefs including personal relief and dependant relief have increased. Personal relief increases from VND9million/month to VND11million/month and dependant relief increases from VND3.6million/month to VND4.4million/month. The increased tax reliefs apply for the whole tax year of 2020. Individual taxpayers should note that under Vietnamese Personal Income Tax law, only Vietnamese tax residents, including internationally mobile employees who meet the conditions to be regarded as tax resident in Vietnam, are entitled to tax reliefs. The tax reliefs are not applicable for non-tax residents in Vietnam. Hung Du Nguyen - hungdu.nguyen@vn.gt.com 18/08/2020