Year End 31 st December. An overview of French payroll Module 3

Transcription

1 Year End 31 st December An overview of French payroll Module 3

2 AGENDA Fact Culture Employment Law Setting up a Business Employer Obligations Time management Absence valuation Tax Social Security Payslip review Final settlement Wage attachment Reports Sickness and Maternity

3 SOCIAL SECURITY

4 Social Security The standard contributions are paid at employee and employer levels The contributions are gathered by 4 models for each employee URSSAF, POLE EMPLOI/ASSEDIC, PENSIONS, OTHERS. Complementary contributions are also added Contributions Accident at Work Transport contribution Optional mutual insurance companies

5 Social Security Mandatory Social Security Schemes France has 3 main Social Security Schemes, social security, unemployment and pensions (general and supplementary). URSSAF - Union de Recouvrement des cotisations de Sécurité Sociale et d'allocation Familiales (Set of agencies responsible for collecting social security and family allowance contributions). URSSAF are regular contributions paid by both the payee and employer to cover Retirement, sickness, workplace accidents, family benefits, widows benefits, and FNAL. Most URSSAF contributions are calculated as a percentage of a funding base (calculation rule = percentage x base). In some cases, contributions may apply to a reduced base

6 Social Security POLE EMPLOI ex ASSEDIC contributions are paid to the state unemployment fund (UNEDIC), which finances unemployment insurance (Régime d Assurance Chomage or RAC) and salary guarantees (Fond National de Garantie des Salaires or FNGS). Pension Plan - Social security scheme is managed by CNAV and the statutory French supplementary pension schemes are managed by ARRCO and AGIRC. AGIRC - ARRCO is an organization that brings together institutions of supplementary retirement for employees and managers. AGIRC ARRCO are complementary and mandatory pension schemes for all salaried employees (ARRCO) and executives (AGIRC). Note than France's ARRCO and AGIRC schemes permit employed workers pursuing an activity outside France to join or continue to belong to the said schemes, either individually or via their employer.

7 SCOPE OF MANDATORY SOCIAL PROTECTION IN FRANCE

8 SOCIAL PROTECTION

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11 Social Security There are 5 sectors (branches) : Sickness Work accidents and professionnal diseases Family benefits Elderly and pensions Collection (Acoss) : This branch is in charge of the treasury

12 Cotisation and levy In France a Cotisation is a contribution: The employee and employer are contributing to an organisation and by doing so it gives the employee rights and benefits from the organisation Whereas the Contribution is a levy : The employee and employer each contribute but it does not give any rights or benefits

13 Cotisation & Levy The majority of the contributions and levies have no limit or cap based on the gross salary: when calculating the contribution or levy the whole gross salary is taken into account In certain cases only part of the gross salary is used to determine the amount to be deducted - known as the Plafond de la sécurité sociale (social welfare cap)

14 URSSAF URSSAF - Union de Recouvrement des cotisations de Sécurité Sociale et d'allocation Familiales (Set of agencies responsible for collecting social security and family allowance contributions) Regular contributions paid by the employee and employer to cover retirement, sickness, workplace accidents, family benefits, widows benefits, and FNAL (housing benefit) Most URSSAF contributions are calculated as a percentage of a funding base (calculation rule = percentage x base) In some cases, contributions may apply to a reduced base, and some contribution classes may qualify for reduced rates or exemption from paying contributions

15 Unemployment - Pole Emploi / Ex ASSEDIC Contributions URSSAF Pole Emploi (or GARP in Paris) contributions are paid to the state unemployment fund (UNEDIC), which finances unemployment insurance (Régime d Assurance Chomage or RAC) and salary guarantees (Fond National de Garantie des Salaires or FNGS) You can enter and maintain Pole Emploi contribution rates, create regulatory reports, make payments to the collector institutions, and create certificates for leavers

16 CONTRIBUTIONS RATES URSSAF 2017

17 ARRCO & AGIRC Both the ARRCO and AGIRC manage pension funds Each comprises employer and employee contributions. Most employees, except for apprentices and trainees, are liable for contributions to ARRCO or AGIRC funds Contributions are paid over via the Association Pour l'emploi des Cadres (APEC) who then pay the APEC, they are managed with the other AGIRC contributions and include lump sum APEC contributions and the APEC contribution base ARRCO, AGIRC, are contingency contributions for managing pension and contingency funds. Contributions simply base for social security contributions * rate ARRCO Tranche A for managers and Tranche A and B for non managers AGIRC Tranche B and C for managers

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19 ARRCO & AGIRC RATES IN 2017

20 CONTRIBUTIONS BASE IN 2017 The contributions are calculated as a percentage (contribution rate) of a base sum (the contribution base). In the general insurance scheme, the contribution base corresponds to the employee salary Case 1 - contribution base = Gross total remuneration Case 2 - contribution base = Ceiling Social welfare Bracket/slice = Tranche T1 = 3269 = 1 PMSS Plafond de securite sociale = Social Security Threshold PMSS = Monthly Social Security Threshold

21 BRACKET/SLICE PMSS PMSS PMSS T1 = 1 PMSS T2 = 2 PMSS T1 T2 PMSS PMSS PMSS PMSS PMSS PMSS PMSS PMSS TA = 1 PMSS TB = 3 PMSS TC = 4 PMSS TA TB TC PMSS = Monthly Social Security Threshold 117

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23 Plafond horaire SS Plafond horaire de sécurité sociale (PHSS 2017) : 24 euros en Plafond journalier SS Plafond journalier de sécurité sociale (PJSS 2017) : 180 euros en Plafond hebdomadaire SS Plafond hebdomadaire de sécurité sociale (PHSS 2017) : 754 euros en Plafond mensuel SS (PMSS) Plafond mensuel de sécurité sociale (PMSS 2017) : euros en Plafond trimestriel SS Plafond trimestriel de sécurité sociale (PTSS 2017) : euros en 2017 Plafond annuel SS (PASS) Plafond annuel de sécurité sociale (PASS 2017) : euros en 2017.

24 Social Welfare Social welfare cap: Is set by the Acoss every year and for every working time frequencies from the hour to the quarter (even though most of the workers in France are being paid monthly) Currently the monthly limit is 3269 (gross salary) which is used as a ceiling for certain contributions and levies Where the employee is a new starter or leaver and hasn t worked a full month, part-time employees and those with multiple employers) the cap is pro-rated

25 Social Welfare Downscaling the social welfare cap - rule of the 1/30th If employee joins or leave the company and the employee is paid monthly The monthly social security welfare cap is divided by thirty and multiplied by the number of calendar days employed If an employee is leaving the 18th of July the cap will be: 18/30 x 3269 for the purpose of calculating the amount of the levy or contribution However, If the employee leaves on Friday 18th and is not contracted to work weekends and the employee starts a new job on Monday the cap is 3269 as there are no unworked days

26 Part Time Employee The cap is determined by this formula : (Social Welfare Cap x Part time gross salary) / FTE gross salary Provided that : Employee is not on short time working Employee is not contribuing at reduced rates Employee does not have multiple employers

27 Multiple Employer Multiple employer social welfare cap : In the event of an employee working for more than an employer, the formula is the following: (Gross salary at the company the employee is working at x Social welfare cap ) / Total gross salaries of all the employers Therefore you must ask all new employees if they have a second employer and they must report if do take on another job

28 ACOSS Acoss manages the treasury but the collection isthrough URSSAF There are several URSSAFs which collect most contributions and levies Employer rate is12.89% of the grosssalary Employee rate is0.75% of the grosssalary. If the employer is located in the departement of Moselle, Haut-Rhinand Bas-Rhin the employee rate iscontribution 2.25%

29 Elderly Contribution Gross salary up to the social welfare cap: Employer : 8.55% of gross salary Employee : 6.90% of gross salary Gross salary in excess of the welfare cap : Employer : 1.90% of gross salary Employee : 0.40% of gross salary Autonomy and solidarity levy : Employer : 0.3% of total remuneration This is determined by the CARSAT (Caisse d'assurance retraite et de la santé au travail) and is based on several factors including the size of the company

30 Other Contributions Contribution to family welfare benefits: Employer : 5.25% of Gross salary. there is a second family benefits contribution rate of 3.45% applicable to businesses covered by the "Fillon" reduction and only for salaries lower than 1.6 times the legal minimum wage (SMIC). As of April 1st, 2016, this 3.45% rate also applies to annual salaries lower than or equal to 3.5 times the legal minimum wage (SMIC). FNAL contribution (housingaidcontribution): Employer : 0.10% of all the total gross salaries (limited by the social welfare cap) If company has more than 9 employees 0.40% of total gross salaries. Where the number of employees is based on 31st December of the previous year Social Fee FORFAIT SOCIAL Employer : 20% of all employer social contributions and levies All the complementary payments are 8% (apart from the payments to PEEs and PERCOs)

31 Other Contributions The basic arduous work contribution ("cotisation pénibilité de base") was rolled out on January 1st, It is payable by all employers for their employees, whether or not they are exposed to arduousness factors and, if they are exposed, regardless of their level of exposure. Additional contributions are payable by the employer for any employees whose exposure to certain arduousness factors exceeds the predetermined thresholds.

32 Specific Levies Levies are deductions that don t fall into obvious categories, such as URSSAF, POLE EMPLOI, or AGIRC Levies are paid to several organizations with different funding bases, different conditions, and on differentdates They cover things like training, transport, apprenticeships, CSG and CRDS contributions, and the Levy on Salaries Some of these levies are often grouped under the heading Other Employer Deductions on the payslip

33 Specific Levies Professional Training Employers must allocate a percentage of their total payroll to professional training The rates vary depending on whether the employer has fewer than 10 employees There is a specific contribution paid by organisations that have contractual employees The funding base isgrosssalary

34 Specific Levies Construction Effort Applies to employers with 10 or more payees, and the funding base is gross salary It is paid to a registered collector organization, or the employer manages it. The levy is paid at the end of the year and is based on salaries paid during the previous 12 months. Apprenticeship The funding is based on gross salary The rate is based on region (Alsace-Moselle or other regions) and is paid to the tax office The postal code of the establishment is used to determine which rate must be applied.

35 PAYROLL TAXES

36 CSG A general social security contribution The contribution is levied on individuals who are domiciled in France for tax purposes and, where earned or substitution income is concerned, members of a French compulsory health insurance scheme The CSG tax base is very wide, since it is levied in principle on earned income, substitution income, income from personal assets and income from investments in fixed-income securities subject to withholding tax or exempt from income tax

37 CRDS The CRDS is payable by individuals domiciled in France for tax purposes and who contribute to a French compulsory health insurance scheme The rate is 0.5% Monthly ceiling of 98.25% The CRDS is not deductible from the income tax base

38 CSG CRDS These levies are separated into 3 parts by URSSAFs and ACOSS for the management of the funds: Taxable CSG: 5.10% Non taxable CSG: 2.40% Non taxable CRDS: 0.50% Employee contributions only Based on 98.25% of gross salary + employer's part of special industry-wide regime

39 FILLON DISCOUNT This measure was made to encourage employment and hiring It reduces the employer's part of social contributions and levies For the companies with less than 20 employees : Fillon discount = (0.281/0.6) x [(1.6 x Yearly minimum wages 1) / Yearly gross remuneration] For companies with 20 employees and over : Fillon discount = (0.26/0.6) x [(1.6 x Yearly minimum wages 1) / Yearly gross remuneration] The results are rounded to 4 decimal places

40 Contributions Payments (reporting is done via DSN) are made via Web, Net entreprise website for 1. POLE EMPLOI contributions are paid to the state unemployment fund (UNEDIC), which finances unemployment insurance (Régime d Assurance Chômage (RAC)) and salary guarantee Fond National de Garantie des Salaires (FNGS) 2. AGIRC/ARRCO (Both the ARRCO and AGIRC manage pension funds) 3. URSSAF website Contributions Payment for URSSAF contributions retirement, sickness, workplace accidents, family benefits, widows benefits

41 Unemployment Contributions The upper limit is equal to 4 monthly social security ceilings (4 x 3,269 ). The unemployment insurance contribution rate has changed as of July 1st, 2013: the employer's contribution due on certain fixed-term contracts has increased whereas a temporary exemption has been instituted for employers hiring employees under age 26 on an open-ended contract. Monthly ceiling Employee contribution 2.4% Employer contribution 4% AGS: wage guarantee insurance association. It is entirely employer-funded and finances the wage guarantee scheme: if a company goes into a receivership or court-ordered liquidation, it guarantees the payment of employees' wages, notice period, and compensation. Monthly ceiling 13,076 Employee s contribution 0% Employer s contribution 0.2%

42 ARRCO & AGIRC Contributions

43 Scope of mandatory social protection in France

44 FNAL FAMILY WELFARE BENEFITS Contribution to family welfare benefits - To finance the APL. You may get allowance from the French government for your housing (type APL, Aide Personnalisée au Logement) The personalised housing aid (APL) is for tenants of social housing or for those who become property owners FNALl contribution (housing aid contribution) : Employer : 0.10% of all Gross salaries

45 FORFAIT SOCIAL SOCIAL FEE Social Fee FORFAIT SOCIAL 20% Employer only : 20% for all compensation/gain/profit not subjected/accountable to the social contributions - see French profit sharing Part 4 Some exceptions with a discount rate of 8% and 16%

46 UNEMPLOYMENT CONTRIBUTIONS AGS (FNGS) AGS - In case of judicial liquidation, court-ordered liquidation, to guarantee the salary payment to the employees Pour l assurance chômage : 6,40 % : réparti à raison de 4 % à la charge de l employeur et de 2,40 % à la charge du salarié. Pour l AGS : 0,20 %, à la charge exclusive de l employeur à compter du 1er janvier 2017 (contre 0,25 % précédemment)

47 CSG CRDS These levies are separated into 3 parts by URSSAFs and ACOSS for the management of the funds. They are divided into 3 : Non Taxable CSG : 5.10% Taxable CSG : 2.40% Non taxable CRDS : 0.50% All these are employee's part only. They have one thing in common, they are based on 98.25% of gross salary + employer's part of special industry-wide «regime».

48 URSSAF RATES 2017

49 End of Session