DOWNLOAD
Hiring in Sint maarten (dutch part)
Sint Maarten, part of the Kingdom of the Netherlands, is a country on the southern part of a Caribbean island shared with Saint Martin. Philipsburg is the capital. Dutch and English are the official languages. Netherlands Antillean Guilder is the official currency. Tourism is the largest industry and the main driver of economic growth. Sint Maarten’s main trading partners are the US, Netherlands, France, Switzerland and Italy. Global PEO or Employer of Record (EOR) play a pivotal role in providing companies with services related to hiring employees, and ensuring compliance with Sint Maarten’s legal and tax regulations. The Labor Code stipulates that employees are entitled to 15 days of annual leave. Residents are taxed on their worldwide income; non-residents are taxed on Sint Maarten-source income. Global PEO’s or Employer of Record (EOR) facilitate companies by ensuring compliance with Sint Maarten’s Labor Code and tax laws.
statutory labor requirements
Probation Period
- A trial period must be agreed to in writing and may not exceed two months
Annual Leave
- Every employee is entitled to an amount of vacation days per year equal to at least three times the contracted number of working days per week, with a minimum of fifteen days per year for employees who work six days per week.
Public Holidays
- New Year's Day (1st January)
- Good Friday (10th April)
- Easter Sunday (12th April)
- Easter Monday (13th April)
- Carnival (30th April)
- Labor Day (1st May)
- Ascension Day (21st May)
- Whitsun (31st May)
- Emancipation Day (of Sint Maarten) (1st July)
- Constitution Day (12th October)
- St. Martin's Day (11th November)
- Christmas Day (25th December)
- Boxing Day (26th December)
Maternity Leave
- The employees are entitled to a full paid leave of a minimum of 4 and a maximum of 6 weeks before the estimated delivery date ('pregnancy leave') and to a minimal of 6 and a maximum of 8 weeks after the birth ('maternity leave').
Paternity Leave
- Fathers are entitled to receive paid paternity leave of seven days
Sick Leave
- In the event an employee is unable to perform his/her labor due to sickness (that is not intentionally caused by the employee), the employer is obligated to continue payment of (100% of) the employee’s salary during a relative short period of time (unless otherwise stipulated in the labor agreement).
Work Hours
- Working hours, including overtime, may be no more than 11 hours per day and 50 hours per week
Overtime
- Overtime shall be paid at time and a half (1 ½) the normal rate during the weekdays and twice (2) the normal rate on Sundays, Public Holidays and Rest Days, except where Sunday is scheduled as part of a shift arrangement, and is therefore paid at time and a half (1 ½) the normal rate.
Notice Period
- The mandatory notice period to be taken into by an employer is:
-
- In case of an employment of less than five years: one month;
- In case the employee has been employed more than five but less than ten years: two months;
- In case the employment has lasted longer than ten years but less than fifteen years: three months;
- In case the employment has lasted more than fifteen years: four months.
Severance
- The employer must pay the employee a one-time severance pay equal to one week’s wage for the first ten years of service
13th / 14th Month Pay
- No
- There is no statutory requirement to pay the 13th or the 14th month salary.
- Employers may give bonuses at their discretion.
income tax
- Residents are taxable on their worldwide income.
- Nonresidents are taxable only on income derived from certain Sint Maarten sources.
- A resident individual who receives income, wherever earned, from former or current employment is subject to income tax in Sint Maarten.
- Income is taxed under a scheduler system
- Employment income, including most employment benefits, profits derived from the carrying on of a business by an individual, income from immovable property and the rights to which they are subject, income from moveable assets and periodic allowances are taxable
- Rates are progressive up to 47.5% (including a local surtax of 25%)
|
Income Tax |
||
|
Taxable Income |
Rate |
|
|
From |
To |
|
|
0 |
ANG 31,837 |
10% (12.5% including the 25% surtax) |
|
ANG 31,837 |
ANG 47,756 |
16% (20% including the 25% surtax) |
|
ANG 47,756 |
ANG 66,328 |
21% (25.25% including the 25% surtax) |
|
ANG 66,328 |
ANG 99,490 |
27% (33.75% including the 25% surtax) |
|
ANG 99,490 |
ANG 140,612 |
32% (40% including the 25% surtax) |
|
ANG 140,612 |
- |
38% (47.5% including the 25% surtax) |
deductible expenses
Personal Deductions
- A resident taxpayer is entitled to more deductible items than a nonresident taxpayer.
- A fixed deduction of ANG500 may be deducted from employment income.
- Instead, actual employment-related expenses incurred may also be fully deducted to the extent that the expenses exceed ANG1,000 annually.
- Residents may claim the following personal deductions:
- Mortgage interest paid that is related to the taxpayer’s dwelling (limited to ANG27,500 annually)
- Maintenance expenses related to the taxpayer’s dwelling (limited to ANG3,000 annually)
- Interest paid on consumer loans (limited to ANG2,500, or ANG5,000 if married, annually)
- Life insurance premiums that entitle taxpayers to annuity payments (up to a maximum of 5% of the income or ANG1,000, annually)
- Pension premiums paid by an employee
- Social security premiums paid by an employee
- Qualifying donations in excess of certain threshold amounts
Business deductions
- In general, business expenses are fully deductible.
- However, the deduction of certain expenses is limited.
- The following deductions are available for self-employed persons:
- Accelerated depreciation of fixed assets at a maximum rate of 331/3%.
- An investment allowance of 8% for acquisitions of or improvements to fixed assets in the year of investment and in the immediately following year.
- The investment allowance is increased to 12% for acquisitions of new buildings or improvements to existing buildings.
- This allowance applies only if the investment amounts to more than ANG5,000 in the year of investment.
|
Deductible Expenses |
|
|
Personal deductions |
|
|
Business Deductions |
|
immigration
- The Kingdom of the Netherlands – Caribbean consists of St. Maarten, Aruba, Curacao, Bonaire, St. Eustatius and Saba.
- The Dutch Caribbean Visa is valid for travel to any of the countries mentioned above and is issued at Dutch Embassies and Consulates around the world.
- US, Canadian, and EU citizens and legal residents, as well as legal residents and citizens of countries who do not require a visa to travel to St Maarten, when visiting St Maarten can stay for up to 90 days (short stay).
- Individuals must have a valid passport.
- Short stays include holidays, business trips and family visits.
- The maximum stay per visit in any one of the countries within the Dutch Caribbean is 1 month (30 days).
- A visitor cannot exceed 90 days’ total stay in the Dutch Caribbean, per calendar year, when travelling on a Dutch Caribbean visa.
- For Dutch nationals and American nationals, maximum stay allowed is 6 months uninterrupted with the possibility to extend.
- For nationals of Canada, the European Union, Australia, New Zealand and Japan; maximum stay allowed is 3 months uninterrupted with the possibility to extend.
|
Type of Visa/Permit |
Documentation |
Validity |
Eligibility |
|
Dutch Caribbean Visa |
|
90 days |
|
value added tax
- Sales tax (BBO) is levied on the sale of goods and provision of services
- The standard rate is 5%
|
Sales Tax |
|
|
Standard Rate |
5% |
withholding tax
- There is no withholding tax on dividends, interest, royalties and technical service fees
termination
- St. Maarten has mandatory rules and regulations regarding termination of employment agreements that have to be taken into account.
- There are, in general, four possibilities for an employer to terminate an employment agreement pursuant to St. Maarten law:
-
- Immediate dismissal, which is only allowed if there is an urgent reason, justifying an immediate termination. Such urgent reason and the immediate termination would immediately have to be informed to the employee;
- Termination by giving notice, in which event the prior approval from the Director of the Ministry of Public Health, Social Development and Labor (Ministerie van Volksgezondheid, Sociale Ontwikkeling en Arbeid) has to be obtained pursuant to the National Ordinance Termination Employment Agreements (Landsverordening Beëindiging Arbeidsovereenkomst). Without such consent any termination by giving notice will be considered null and void. Such consent has to be requested by the employer and the request has to be justified and substantiated. The Director could decide to grant consent under the condition that compensation has to be paid out to the employee or under other conditions to be established by the Director;
- Dissolution by the Court of First Instance of St. Maarten; and
- Termination by mutual agreement. In such event the employer and the employee themselves negotiate the terms and conditions for the termination of the employment agreement.
statutory benefits
- These are mandatory benefits as postulated by law
- These include probationary period, annual leave, public holidays, sick leave, maternity leave, paternity leave, overtime pay, notice period, and severance pay
- Statutory benefits also include social security benefits
|
Statutory Benefits |
|
Probationary Period |
|
Annual Leave |
|
Public Holidays |
|
Maternity Leave |
|
Paternity Leave |
|
Sick Leave |
|
Overtime Pay |
|
Notice Period |
|
Severance Pay |
|
Social Security Benefits |
payments and invoicing
- Because the wage tax is a pre-levy to the income tax, employers must file wage withholding tax returns on a monthly basis.
- The wage tax return must be filed before the 16th day of the month following the month in which the salaries are paid to employees.
- For most employees, wage withholding tax is the final tax.
- Personal income tax returns for the calendar year must be filed within two months after the issuance of the tax return forms, unless an extension for filing is obtained.
- Any additional income tax to be paid is normally due within two months after the date of the final assessment.
- If both spouses earn income, married persons are taxed separately on the following types of income:
-
- Employment income
- Self-employment and business income
- Certain periodic allowances, including old-age pensions, alimony and disability allowances
employee accruals
| Christmas Bonus% |
0% |
| Christmas Bonus Over Vacations % |
0% |
| Severance per Year % |
Employees are entitled to severance pay that equals to 1 week of pay after one year of service (1.37% of annual salary) |
| Vacations % | Employees are entitled to 15 days of annual leave (4.28% of annual salary) |
| Notice % |
Employees are entitled to a 1 month of notice period for one year of service or more (8.33%) |
| Christmas Bonus Over Notifications% | 0% |
| Vacations Plus% | 0% |
| Total percentage of Salary (yearly) | The total employment accruals as a percentage of salary per anum are equal to 13.98% |
employer accruals
Additional information (Country Accruals)
| Social Security | 7.50% |
| Health Insurance | 8.30% |
| Accident Insurance | 5.00% |
| Description | The employee's share of taxes for old age insurance (AOV) and widows and orphans insurance (AWW) is 6.5% of a maximum of ANG 100,000 gross wages. The employer contributes 7.5%. Income in excess of this amount is not subject to this tax. Expatriates may be exempt from this tax.Coverage for health insurance for workers earning up to ANG 67,816.32 is compulsory. Contributions are 4.2% for the employee, 8.3% for the employer.Employees are also insured against loss of income as a result of an accident that occurs at work. The premium varies from 0.5% to 5%, depending on the class of risk, to be paid fully by the employer. Maximum premium income is ANG 67,816.32.The Algemene Verzekering Bijzondere Ziektekosten (AVBZ), or general insurance exceptional medical expenses, is a national social insurance from which the entire population of St. Maarten can derive rights. The AVBZ guarantees, among other benefits, medical care to persons suffering from a chronic disease or a mental or physical disorder. The premium charged to create the necessary funds amounts to, in general, 2% of taxable income, with a maximum charge of ANG 8,572 per year (2012). The employer's share amounts to 0.5% of the employee's income, with a maximum of ANG 2,143 per year (2012). A more recent premium cap has not been published yet. Old-age pensioners are taxed at a rate of 1.5%.
|
Employer Accruals Additional information
| Employment Accruals | ||
| Annual Leave | Every employee is entitled to an amount of vacation days per year equal to at least three times the contracted number of working days per week, with a minimum of fifteen days per year for employees who work six days per week. | This equals 4.1% (15/365 days) of annual income |
| Maternity Leave | The employees are entitled to a full paid leave of a minimum of 4 and a maximum of 6 weeks before the estimated delivery date ('pregnancy leave') and to a minimal of 6 and a maximum of 8 weeks after the birth ('maternity leave'). | This equals 19.2% (10/52 weeks) of annual income |
| Paternity Leave | Fathers are entitled to receive paid paternity leave of seven days | This equals 1.9% (7/365 days) of annual income |
| Sick leave | In the event an employee is unable to perform his/her labor due to sickness (that is not intentionally caused by the employee), the employer is obligated to continue payment of (100% of) the employee’s salary during a relative short period of time (unless otherwise stipulated in the labor agreement). | Subjective |
| Overtime | Overtime shall be paid at time and a half (1 ½) the normal rate during the weekdays and twice (2) the normal rate on Sundays, Public Holidays and Rest Days, except where Sunday is scheduled as part of a shift arrangement, and is therefore paid at time and a half (1 ½) the normal rate. | Depends on the number of overtime hour worked |
| Severance | The employer must pay the employee a one-time severance pay equal to one week’s wage for the first ten years of service | This equals 1.92% (1/52 weeks) of annual income |
| Social Security | All resident individuals must pay social security contributions. The contributions provide benefits under the General Old Age Pension Ordinance (AOV), the General Widows and Orphans Ordinance (AWW) and the General Insurance Extraordinary Sickness Ordinance (AVBZ). Total employer contributions are 23.8%. |
This equals 23.8% of annual income |
