St. Maarten - Adjustments in Payroll Support Program for the Month of June 2020

St. Maarten - Adjustments in Payroll Support Program for the Month of June 2020

Introduction

Based on the advice of the Financial Supervision Council (CFT) of 6 May 2020, the Kingdom Council of Ministers has decided that the payroll support program of Sint Maarten must be changed before an additional amount of ANG 29 million will be made available to the country of Sint Maarten to finance the payroll support program for the period from May 15, 2020 to June 30, 2020.

The effect of the above changes is that the government no longer reimburses a maximum of 80 percent of the payroll support, but that this support has been reduced to a maximum of 60%. On the other hand, the exception lists that included sectors that were not eligible for payroll support do not apply for June. This has the effect of reducing the government contribution per employer but increasing the number of employers eligible for payroll support.

The adjustments mean that:

  • employees have to make a personal contribution to the payroll support of 20 percent;
  • The maximum reimbursement paid by the Government amounts to 60 percent of the payroll (gross wages, not including the employers’ share of social security)[1];
  • The payroll support scale model is changed to a one-to-one ratio with loss of revenue with retrospective effect as of June 1, 2020;
  • As of June, the exception list, which excluded certain sectors and categories from the payroll support program, is no longer in force;
  • when applying for payroll support for the month of June, employers must sign a digital statement that unambiguously authorizes the name of the employer to be published on the internet, in the newspaper and in the National Gazette if this employer has received payroll support. The publication is with retrospective effect as of the first time the employer received payroll support.

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[1] the maximum reimbursement from the government is 60% of the registered ZV / OV wages at USZV with a maximum of the ZV wage limit (ANG 5,651.36 per month)

Examples[2]

Loss of turnover 30 percent, Monthly wages ANG 100,000

This means that of 30 percent of the wages, the employee must contribute 20 percent and USZV on behalf of the country of Sint Maarten 60%. Consequently, of the amount of ANG 30,000 (30%) of the wages, ANG 6,000 is carried by employees and ANG 18,000 is paid by USZV on behalf of the country of Sint Maarten. The remainder is for the account of the employer.

Overview loss of turnover 30%:

Monthly Wages

ANG 100,000

 

Contribution USZV/SXM

ANG   18,000

30% x 60%

Contribution Employees

ANG     6,000

30% x 20%

Contribution Employer

ANG   76,000

30% x 20% + 70%

           

Wage tax and premiums payable over:

ANG   94,000

 

 

Loss of turnover 50 percent, Monthly wages ANG 100,000

This means that of 50 percent of the wages, the employee must contribute 20 percent and USZV on behalf of the country of Sint Maarten 60%. Consequently, of the amount of ANG 50,000 (50%) of the wage, ANG 10,000 is carried by employees and ANG 30,000 is paid by USZV on behalf of the country of Sint Maarten. The remainder is for the account of the employer.

Overview loss of turnover 50%:

Monthly Wages

ANG 100,000

 

Contribution USZV/SXM

ANG   30,000

50% x 60%

Contribution Employees

ANG   10,000

50% x 20%

Contribution Employer

ANG   60,000

50% x 20% + 50%

           

Wage tax and premiums payable over:

ANG   90,000

 

 

Loss of turnover 70 percent, Monthly wages ANG 100,000

This means that of 70 percent of the wages, the employee must contribute 20 percent and USZV on behalf of the country of Sint Maarten 60%. Consequently, of the amount of ANG 70,000 (70%) of the wages, ANG 14,000 is carried by employees and ANG 42,000 is paid by USZV on behalf of the country of Sint Maarten.  The remainder is for the account of the employer.

Overview loss of turnover 70%:

Monthly Wages

ANG 100,000

 

Contribution USZV/SXM

ANG   42,000

70% x 60%

Contribution Employees

ANG   14,000

70% x 20%

Contribution Employer

ANG   44,000

70% x 20% + 30%

           

Wage tax and premiums payable over:

ANG   86,000

 

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2 Examples as mentioned in the explanation attached to the Regulation Payroll Support for June (AB 2020, no 36)

 

 Final remarks

  • The employee's own contribution can be made from the total benefits package and doesn’t necessarily result in a decrease of salary. For example, the employee can make contributions by giving up (part of) vacation payments or vacation days off.
  • The employer must enter into an agreement with the employee, stating the exact employee’s contribution for the month of June 2020 and indicate how the USZV can check the interpretation of this personal contribution.

 

Regards, Management & Staff of Grant Thornton Sint Maarten

 

[1] the maximum reimbursement from the government is 60% of the registered ZV / OV wages at USZV with a maximum of the ZV wage limit (ANG 5,651.36 per month)

[2] Examples as mentioned in the explanation attached to the Regulation Payroll Support for June (AB 2020, no 36)