Human resources management, Payroll administration

Running own payroll can be time consuming, complicated and generally cost inefficient. The advantage of payroll agenda outsourcing for SME (Small and Medium Enterprises) is mainly saving of expenses and reduction of administrative burden. Larger companies can benefit from risk diversification or confidential/personal data protection. It is common that we take over complete Payroll/Payslip agenda, in particular

  • registration to taxes, social authority and health insurance companies, representation by all authorities including Czech Statistical Bureau or Ministery of Labour and Social Affairs
  • payroll preparation of employees including foreign employees or employees of foregin entities in Czech Republic
  • administration of all monthly or annual reportss: payroll, PAYE, NIC, pay slips, maternity leave, attachment of earning
  • administration of statistic reports in the field of Labour and Wages
  • undertake of the responsibility, settlement of the whole communication with tax, social and health authorities
  • regular preparation of contrilling reports, organisation of cost centers in relation to management accounting, price calculations, etc.
  • payment orders preparation
  • expense reports, travel allowance management and calculation
  • bonus scheme planning and fine-tuning
  • labour-law and industrial consultancy, see further

Payroll administration for foreign Employers

Are you foreign based entity which intends to employ someone in Czech Republic? We will help you with the whole on-boarding process. All steps must be performed in compliance with Tax Convention between Czech Republic and your country in order to avoid formation of permanent establishment. Among our clients belong numerous foreign employers having in Czech Republic just sales representatives, technical engineers etc.

Human resources management, benefits, Labor market Analysis

We will help you with hiring new labor force, sketching remuneration schemes and formation of company by-laws related to employee's benefits. Thanks to our activities in academic sphere, we provide various employment or branch analysis.

  • formation, wording and drafts consultation of employment contracts,
  • cooperation in seeking and hiring employees, training courses or further education
  • prepreation of materials and statistical analysis for the optimal setting of company's wage policy
  • labor marker analysis for particular business sector, incuding regional wage distribution statistics
  • consultancy in the field of training and education, labour-law, national health and social insurance

Benefits, wage in kind

Benefits or wage in kind components are currently largely provided to employees in order to keep or even raise their motivation but also as a means in competitive fight for new labour force. Therefore it is an important topic that should not be neglected.

Generally the company can provide employee by any benefit, however it has further tax impacts for company as well as for employee. The most wanted benefits are those that are fully tax deductible for company and at the same time exempted from income tax for employee.

Second group are benefits that are fully tax deductible (that means tax efficient costs) for company but partly taxed on the side of employee.

Third group are benefits that are tax inefficient. These are typical expenditures that employer provides from capital reserves (profit after taxation). If the company provides these benefits as a regular expenditure or if the company produced loss, these expenditures are tax ineffective. At the same time such benefits are exempted from employee´s taxation when they do not exceed legally set threshold. The difference provided above the threshold must be taxed as a salary by an employee.

Among typical benefits typically belong:

  • vacation or medical contributions,
  • contributions for culture and sport actions,
  • meal vouchers,
  • educational courses and language classes,
  • paid childcare by company,
  • company car,
  • pension and life insurance contributions,
  • entertainment costs (team building activities).

Tax deductible versus not deductible (inefficient) cost

When talking therein before about tax deductible or not deductible (efficient vs. non-efficient) costs, it is also appropriate to explain the difference from the company´s point of view. It simply means that these costs must be excluded from the accounting profit in tax declaration, so the tax base increases. In particular, tax not deductible cost of 1000 CZK means, that the company for such costs pays about 19 % more = 1190 CZK. 19 % is current Czech Corporate Income Tax Rate.

We will help you with benefit outline and optimization as well as wording necassary company's by-laws (interanal directives).

See also: copmany consultancy, tax consultancy, bookkeeping, additional activities

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