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trIs an employee on maternity leave taken into account when calculating the average monthly number of employees?
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Is an employee on maternity leave taken into account when calculating the average monthly number of employees?
According to Article 102.1.30 of the Tax Code, 75% of the business income earned by an individual entrepreneur qualifying as a micro-business entity is exempt from income tax, provided that the average monthly number of employees during the relevant year is at least three.
My question is: If one of the three employees goes on maternity leave in the middle of the year, is that employee included when calculating the average monthly number of employees? Although the employee is on maternity leave, they remain on the payroll, and the entrepreneur duly applies for the relevant monthly maternity benefits in accordance with the applicable procedures.
The State Tax Service under the Ministry of Economy stated that, pursuant to Article 102.1.30 of the Tax Code, the 75% income tax exemption applies to the business income of individual entrepreneurs that qualify as micro-business entities, provided that the average monthly number of employees for the relevant year is at least three and there are no outstanding mandatory state social insurance liabilities.
The average monthly number of employees for the relevant year is calculated by adding the number of employees for each month of the calendar year and dividing the total by 12.
If a taxpayer does not meet the conditions for applying this tax incentive and, in the following reporting year, moves from the micro-business category to another category of business entity, an amount equal to 75% of the income tax calculated and paid for the previous three calendar years, during which the entrepreneur qualified as a micro-business entity, is credited against the income tax liability arising during the period in which the entrepreneur operates under another business category.
If the taxpayer carries out non-genuine (fictitious) transactions, the tax incentive provided under this article does not apply to the income derived from such transactions.
In response to the inquiry, the State Tax Service clarified that an employee on maternity leave is included when calculating the average monthly number of employees.
According to Article 102.1.30 of the Tax Code, 75% of the business income earned by an individual entrepreneur qualifying as a micro-business entity is exempt from income tax, provided that the average monthly number of employees during the relevant year is at least three.
My question is: If one of the three employees goes on maternity leave in the middle of the year, is that employee included when calculating the average monthly number of employees? Although the employee is on maternity leave, they remain on the payroll, and the entrepreneur duly applies for the relevant monthly maternity benefits in accordance with the applicable procedures.
The State Tax Service under the Ministry of Economy stated that, pursuant to Article 102.1.30 of the Tax Code, the 75% income tax exemption applies to the business income of individual entrepreneurs that qualify as micro-business entities, provided that the average monthly number of employees for the relevant year is at least three and there are no outstanding mandatory state social insurance liabilities.
The average monthly number of employees for the relevant year is calculated by adding the number of employees for each month of the calendar year and dividing the total by 12.
If a taxpayer does not meet the conditions for applying this tax incentive and, in the following reporting year, moves from the micro-business category to another category of business entity, an amount equal to 75% of the income tax calculated and paid for the previous three calendar years, during which the entrepreneur qualified as a micro-business entity, is credited against the income tax liability arising during the period in which the entrepreneur operates under another business category.
If the taxpayer carries out non-genuine (fictitious) transactions, the tax incentive provided under this article does not apply to the income derived from such transactions.
In response to the inquiry, the State Tax Service clarified that an employee on maternity leave is included when calculating the average monthly number of employees.