Statutory Deductions means mandatory payments, deductions, and or contributions required by Applicable Law to the following parties in respect of employees’ salary and other employment benefits.
Statutory Deductions in Trinidad and Tobago refers to:
- NIS Contribution,
- Health Surcharge
- Pay As you Earn (P.A.Y.E.)
How are they calculated?
- NIS Contribution
Did you know? – The Principles of Social Insurance
Eight principles of Social Insurance which are the foundation of the National Insurance System are:
- Universality: All persons who qualify as insured persons are covered under the NI Act without exception.
- Compulsion: No one who qualifies as an insured person is allowed to opt-out of the system.
- Pooling of Risk: The risk and cost are spread out over a large number of persons thereby making the system affordable.
- Portability: Social Insurance is portable, following the worker from job to job.
- Wage Stop: This principle aims to cover a level of earnings that will guarantee a reasonable level of income replacement for the lower-middle-income earners.
- Loss of Earnings: Benefits are paid subject to loss of earnings.
- Economic Independence: Benefits form only a percentage of assumed earnings. Workers must not be provided with an incentive to stay away from the job. For the welfare of the country, all the skills and resources are required on the job to facilitate the task of national development.
- Redistribution: Income is distributed from high wage earners to low earners; from well to the sick; from the employed to the retired; from the living to the dependents of the dead.
The contribution due is based on your earning class according to the contribution table.
Earnings Classes and Contributions from September 5, 2016, based on a Contribution Rate of 13.2% of Insurable Income.
|Weekly Earnings||Monthly Earnings||Assumed Average Weekly Earnings||Employee’s Weekly Contribution||Employer’s Weekly Contribution||Total Weekly Contribution||Class Z
|I||200.00 – 339.99||867.00 – 1472.99||270.00||11.90||23.80||35.70||1.79|
|II||340.00 – 449.99||1,473.00 -1,949.99||395.00||17.40||34.80||52.20||2.61|
|III||450.00 – 609.99||1950.00 -2,642.99||530.00||23.30||46.60||69.90||3.50|
|IV||610.00 – 759.99||2,643.00 -3,292.99||685.00||30.10||60.20||90.30||4.52|
|V||760.00 – 929.99||3,293.00 -4,029.99||845.00||37.20||74.40||111.60||5.58|
|VI||930.00 -1,119.99||4,030.00 -4,852.99||1,025.00||45.10||90.20||135.30||6.77|
|VII||1,120.00 -1,299.99||4,853.00 -5,632.99||1,210.00||53.20||106.40||159.60||7.98|
|VIII||1,300.00 -1,489.99||5,633.00 -6,456.99||1,395.00||61.40||122.80||184.20||9.21|
|IX||1,490.00 -1,709.99||6,457.00 -7,409.99||1,600.00||70.40||140.80||211.20||10.56|
|X||1,710.00 -1,909.99||7,410.00 -8,276.99||1,810.00||79.60||159.20||238.80||11.94|
|XI||1,910.00 -2,139.99||8,277.00 -9,272.99||2,025.00||89.10||178.20||267.30||13.37|
|XII||2,140.00 -2,379.99||9,273.00 -10,312.99||2,260.00||99.40||198.20||298.20||14.91|
|XIII||2,380.00 -2,629.99||10,313.00 -11,396.99||2,505.00||110.20||220.40||330.60||16.53|
|XIV||2,630.00 -2,919.99||11,397.00 -12,652.99||2,775.00||122.10||244.20||366.30||18.32|
|XV||2,920.00 -3,137.99||12,653.00 -13,599.99||3,029.00||133.30||266.60||399.90||20.00|
|XVI||3,138.00.00 and over||13,600.00 and over||3,138.00||138.10||276.20||414.30||20.72|
View more information:
- Health Surcharge
Health Surcharge is a tax, which is charged on employment. The Health Surcharge is charged and payable by every employed person who pays or who is liable to pay contributions under the National Insurance Act and individually, other than self-employed persons who are liable to furnish a return of income. Under the age of 16 and 60 years and over are exempt from payment of the Health Surcharge.
Health Surcharge is payable at two rates:
(4) The rates at which health surcharge is payable are as follows:
(a) employed persons whose monthly emoluments are more than $469.99 or whose weekly emoluments are more than $109.00—$8.25 per week. All other employed persons—$4.80 per week;
(b) individuals other than employed persons whose total income for the year of income averages more than $469.99 per month—$8.25 per week.
All other individuals other than employed persons—$4.80 per week.
Health Surcharge Act CHAPTER 75:05 4
For employed persons, the employer must make this payment after deducting the correct amount from the salaries of their employees at each pay period. This amount is payable to the board on or before the 15th day of the month following the month in which the deduction was made. Health Surcharge is payable in cash or cheque and must be accompanied with the PAYE/Health Surcharge Monthly Return. For individuals other than employed persons, the Health Surcharge shall be paid to the board on or before 31st March, 30th June, 30th September, and 31st December in each year of income.
An employer who fails or neglects to deduct a health surcharge and/or remit to the board is guilty of an offense. In addition to the amount not deducted and/or remitted is liable to a penalty of 25% of such amount and interest at the rate of 20% on both the outstanding amount and penalty from the due date of payment. Where a taxpayer (including an employee) has outstanding taxes and refuses or neglects to make payments to liquidate these arrears, the Board of Inland Revenue can enforce collection using various methods empowered by the Income Tax Act.
These arrears are deducted in addition to any tax which is due under the PAYE system. This payment must not be included in the monthly PAYE deductions. A separate PAYE Remittance Form must be used.
P.A.Y.E with effect from January 1, 2021, the allowance for the year was increased to $84,000.00. PAYE is 25% of your income after the first $7000.00.
Where and when are payments remitted:
All NIS contributions are remitted at The National Insurance Board. Payments are due on the 15th of each month for the previous month.
For example, January 2021 Contributions are due by February 15th, 2021.
All Health Surcharge and PAYE payments are remitted at The Board of Inland Revenue. Payments are due on the 15th of each month for the previous month.
For example, January 2021 Payments are due by February 15th, 2021.