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.
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| Country | Extended tax filing deadline | Extended tax payment deadline | Other tax measures and considerations | Contacts | Last updated |
|---|
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 | 13/8/2020 |
| 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 | 31/3/2020 |
| 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 | 12/5/2020 |
| 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 | 21/8/2020 |
| 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 | 3/4/2020 |
| 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 | 8/4/2020 |
| Cambodia | No | No | Updates will be forthcoming. | Ronald C. Almera - ronald.almera@kh.gt.com | 1/4/2020 |
| 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 | 18/8/2020 |
| 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 | 24/8/2020 |
