What is payroll cut off?

What is payroll cut off?

Deadline for payment of salaries

Transactions paid in cash may no longer exceed 1,000 euros. Last July 11, the new regulation came into force, establishing new limits for cash payments. The self-employed and SMEs are among the main parties affected by this new regulation.

Arrabe Integra, Business Advisors, specifies that any operation in which one of the parties is a self-employed or a company, must be governed by these new limits. This rule will be the same whether the payment is received in euros or in foreign currency.

This means a decrease in the cash payment limit of 1,500 euros. Until now, up to 2,500 euros could be paid in cash if the transaction involved a trader or professional.

The established limits must also be applied to salaries that are paid in cash and that exceed 1,000 euros gross. The same applies to other items such as per diems, extra payments or transportation.

What is the limit for payroll?

On the other hand, the Workers’ Statute establishes that the periodicity of the payment of payrolls cannot exceed more than one month. That is to say, you will be able to pay the payrolls of your employees weekly or every 15 days, but never to exceed the deadline of every two months or month and a half.

When is payroll considered late?

Therefore, and in general, payrolls are paid between 29-5 of each month, depending on the company, so if the period of one month is exceeded without being paid, it is considered as a delay in the payment of the payroll.

What happens if the payroll is not paid on the due date?

What are the penalties for not paying wages on time? Penalties can range from 250 to 5,000 times the general minimum wage. In addition to the termination of the contract and the obligation of the employer to pay the worker the corresponding indemnity.

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Payroll payment deadline

The first mandatory date is for companies with more than 250 employees, which must start issuing electronic payroll from October 1 to 29, 2021 (See: Deadline extended to implement Annex 1.8 of the electronic invoice). As from November 1, companies with 101 to 250 employees must carry out this process and for those with between 11 and 100 employees the process will have to be carried out as from December 1, 2021, and for companies with less than 10 employees, the deadline to start with the generation and transmission of electronic payroll is January 1, 2022.

The electronic payroll is part of the guidelines of the National Tax and Customs Directorate (Dian) that seek to improve the fiscal control of the taxes collected through the different tax documents. Daniel Medina, CEO of Olimpia It (a technology company that develops platforms and businesses for the transformation and digital protection of the country), the document will have information such as the salary earned, the net payable and deductions, whether for contributions or other concepts. “All this data will be reflected in an XML file with the structure required by the Dian for its respective review. After delivering it to the entity in digital form, the entity will verify that it complies with the established parameters and will be in charge of validating or rejecting the document sent,” he explained.(See: Electronic Payroll: answers to frequently asked questions).In addition, Medina shared five keys that should be taken into account about the electronic payroll:1.

What happens if my payroll is not paid?

If your company does not pay you the respective salaries or you suffer continuous delays in your salary, you can sue the company, either to regularize the situation and collect the amounts owed or to request the termination of the employment relationship.

What do I do if I have not been paid my salary?

First, it is important to consider conciliation. In other words, go to the corresponding area and try to clarify the situation. If the above does not resolve the conflict and the delay in payment is a recurring action, it is essential to report it to Profedet.

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How many days can salary payments be delayed?

However, the Labor Directorate establishes that the employer has a period of 5 days to pay wages, after the date on which they should be paid.

Payroll payment out of time

If you have debts and do not pay, your salary can be garnished, but only up to a limit. Find out the maximum amount of your salary that the Treasury can garnish, in what order it will do it and what assets are unattachable.

Fortunately, there is a maximum amount that the Treasury or any agency can garnish a salary. In other words, no institution can deprive a worker of the total amount of his or her salary. There is an unattachable limit in any case, so that only the income that exceeds this figure can be deducted. The specific amount is determined by the reason for the debt and the specific circumstances of the individual.

Article 607 of the Civil Procedure Law establishes that the minimum wage or SMI cannot be garnished.  In 2017 the Minimum Interprofessional Wage is established at 707.6 euros. This is the amount that any worker will receive regardless of their debts with the Treasury, Social Security or banks, to name three of the most common creditors. Once the SMI is exceeded, the percentage to be seized by the Treasury increases as the debtor’s income increases. The scale to be applied is as follows:

What is the maximum amount that can be deducted from a worker?

Limits on deductions from salaries and pensions

Some are optional, and require written agreement between employer and employee, which may not exceed 30% and 15% for purposes expressly indicated in the Code and in the aggregate may not exceed 45% of remunerations.

What is the maximum amount that can be deducted per payroll 2021?

The amount payable shall in no case exceed the amount of one month’s wages and the discount shall be as agreed upon by the employee and the employer, but may not exceed thirty percent of the excess of the minimum wage; II.

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How much will the minimum wage increase in 2021?

The General Government approved the increase in the Minimum Wage, so it will now be 172.87 pesos per day, previously it was 141.70 pesos per day.

Maximum term to pay the payroll

Pursuant to Article 20 of the LFT, any act that gives rise to the rendering of subordinated personal work to a person, through the payment of a salary, will be considered as an employment relationship.

It should be noted that the enjoyment of the salary is a right that cannot be waived by the employee and that he/she is free to freely dispose of it. It is also important to consider that wage deductions are prohibited, except in the cases set forth in the LFT.

Article 110 of the LFT sets forth the discounts allowed on wages above the minimum wage, as well as the procedure to be applied by the employer, which refer to the following concepts:

Regarding the discount, the employer will have to reach an agreement with the employee regarding the amount of the salary reduction; although this must not be greater than 30% of the excess of the minimum salary.

Pursuant to Section III of Article 110 of the LFT, employees’ salaries may be deducted for the payment of installments to cover loans from Infonavit for the acquisition, construction, repair, expansion or improvement of housing, or for the payment of liabilities acquired for such concepts. These discounts must have been freely accepted by the employee.