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Legislative updates
Last Year of Extraordinary IRS Surcharge in Portugal PDF Print

tax_relief_2The sobretaxa extraordinária de IRS (extraordinary IRS surcharge) is an overtax levied at source introduced as an extraordinary measure in 2011 and continuously extended afterwards. It is levied on income earned by dependent workers and pensioners residing in Portugal. It’s a progressive tax, ranging from 0% to 3.5%, applied on taxable income, along with the IRS (ranging from 14.5% to 48%).


The tax is planned to be phased out of payrolls gradually, both by decreasing certain thresholds, as well as increasing the thresholds ranges. It will be entirely removed by December 2017 from all Portuguese payrolls.


See table for current (yearly) sobretaxa extraordinária application:




* Applicable from January 2017, subject to 2 more changes applied from July and December 2017.


2017 Changes Scheme:


    I. The first change applied from January 2017, has provided higher thresholds and canceled the 1,00% range, previous applicable to 2nd class. II. Starting July 1st the 1.75% threshold (3rd class) will also be exempted of sobretaxa extraordinária, reducing it to 0%.

III. Third step will be applied from December 1st the 4th and 5th classes will also be removed.


Taking into consideration the partial pay for 2017 for different categories, the yearly percentage, divided by the total number of months will be in fact lower. The annual average extraordinary IRS surcharges rate will be:

  • 3rd class – 6 months surcharge of 1.75%, estimated annual 0.88%
  • 4th class – 11 months surcharge of 3.00%, estimated annual 2.75%
  • 5th class – 11 months surcharge of 3.50%, estimated annual 3.21%

    See table for current monthly sobretaxa extraordinária per categories of taxpayers:




    For more advice on HR administration outsourcing or payroll simulation for Portugal please send us an inquiry at This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

    New Unemployment Benefit Rules in Italy PDF Print

    LayOFFThe Italian government announced that it is changing the unemployment benefit schemes. Since the implementation of the Fornero Reform, a set of changes have succeeded in the Italian unemployment law, dismissal procedures and mobility allowance.

    A new change is coming in force from the beginning of next year. The amendment foresees that employees dismissed under collective dismissal procedure will no longer be subject to mobility lists and therefore, the mobility allowance.

    The mobility lists and benefits were part of law number 223, implemented in 1991. Employees which were dismissed under collective staff reductions were included in the so-called mobility lists and were also subject to the mobility allowance. This privilege will cease from 01/01/2017.

    Starting with 2017, dismissed employees will only benefit of the NASpI unemployment benefit. The NASpI unemployment benefit will remain the only form of unemployment benefit in Italy. NASpI was introduced in May 2015 and replaced the previous 2 forms of unemployment benefits – ASpI and mini-ASpI.

    The NASpI unemployment benefit is paid for 2 years maximum. The base of calculation for the benefit is the remuneration previously received.

    In recent years a trend has developed in the collective dismissal procedure: older employees are more likely to be subject to collective dismissals. Although it might seem discriminatory to choose the older workers, they suffer minor damage from dismissal due being close to retirement.

    According to the new provisions companies will have to submit a written form of the dismissal procedure to the Regional Directorate of Labor. The collective staff reduction form must contain the list of impacted workers along with the selection criteria, which must be transparent.

    The employer engaged in collective dismissal has to pay a layoff tax for the unilateral termination on an indefinite employment contract. The tax is called “Ticket licenziamento Inps” and is calculated based on the seniority and on the gross salary of the dismissed employee.

    The new reform aims to simplify the complex structure of unemployment benefits currently applied in Italy and streamline it with that of other EU countries.

    Major Changes in Swiss VAT Law Starting 2017 PDF Print

    Swiss_VATThe Swiss Parliament has recently revised the VAT law. A set of amendments were applied for a large range of businesses with commercial activity on the Swiss territory.

    It is estimated that the new amendments will affect around 30 000 foreign business, leading them to register as VAT payers in Swizterland.

    The revised Swiss Value Added Tax (VAT) is expected to enter in force on January 1st, 2018.

    Although the CHF 100.000 threshold won’t change, it will now apply to global turnover, and not only turnover generated in Switzerland. As the calculation process will change, the law will affect several categories of businesses:

    • Any non-Swiss established business that registers a global turnover greater than CHF 100.000 will have to register for Swiss VAT and will be liable for the Swiss VAT from the first taxable turnover generated in Switzerland.
    • Foreign entities registered for VAT in Switzerland will have the obligation to levy Swiss VAT on any supplies in Switzerland, including those services that would have been subject to reverse charge. This amendment is expected to have impact on a wide range of foreign companies operating on low scale in Switzerland; businesses making occasional supplies, as well as businesses that regularly sell services to Swiss recipients.
    • Businesses established in Switzerland will also be affected by the new amendments. Their turnover threshold will now be calculated including the global turnover of the company. Hence, Swiss businesses which mostly generate business abroad, but have a total turnover of over CHF 100.000 will thus be liable to register for Swiss VAT.
    • Vendors supplying low-value goods from outside Switzerland into the Swiss territory will be subject Swiss VAT registration and payment if their Swiss generated revenue will cross the annual CHF 100.000 threshold. This measure aims to ensure equal competitiveness with local suppliers. The amendment does not specify the exact term of the registration liability and whether it will be re-assessed on an annual basis.


    The amendments also include a set of administrative changes.

    Considering the major changes in the Swiss VAT law, foreign suppliers, as well as Swiss domiciled companies and branches with foreign activity (due to international revenue totals) will have to undertake a set of actions:

  • Verify the necessity of registration for Swiss VAT considering the new regulations.
  • Note: suppliers with global revenue greater than CHF 100.000 will be subject to Swiss VAT starting January 2017.

  • In case VAT registration is mandatory, adjust the internal processes: IT, customer/supplier master data and if necessary, the end-consumer prices.
  • Note: supplies of electronic services to Swiss customers must be provided on Swiss territory.

    If you consider that your entity in Switzerland might be subject to VAT under the new rules/starting next year, you might be interested in an experienced local partner. We offer outsourcing Accounting and Payroll Solutions in Switzerland. Don’t hesitate to send us an inquiry at This e-mail address is being protected from spambots. You need JavaScript enabled to view it

    Collective Labour Agreements in Italy - Visual Guide PDF Print

    Ever thought of a career in Italy? Then you should take a close look to how Italian Collective Labor Agreements (CCNL) work in practice. Once you start working in Italy, you will have to comply with the local labor rulings. For HR administration purposes, your employer will apply the closest CCNL fitting your industry and position also you will be assigned an employment level from that specific Collective Agreement.

    For an easier understanding we have prepared a visual guide for one of the most wide spread CCNLs covering the Tertiary, Distributions and Services sectors.

    CCNL Terziario, Distribuzione e Servizi, as it is called in Italian, is applied in a wide range of industries, due to the diversity of administrative-related professions and technical positions it covers. CCNL Tertiary, Distribution and Services is divided into 7 levels of employment plus Level Quadri for Middle Management.

    Top Management positions are subject to a separate Collective Agreement, regardless of sector, called CCNL Dirigenti.

    Quadri: Workers in managerial positions with decision making-powers over assets and human resources.

    Level I: Employees with responsibility for production units or organizational functions - Head of Services (technical, commercial, administrative) with responsibilities in such fields as marketing, public relations, market research.

    Level II: Employees working independently or who carry out coordination and control functions.

    Level III: Employees with tasks that require special technical knowledge and experience; skilled workers with specific skills.

    Level IV: Employees involved in operational duties or sales; skilled workers with good technical and practical knowledge.

    Level V: Employees possessing regular technical and practical knowledge.

    Level VI: Employees with basic technical knowledge.

    Level VII: Workers performing cleaning or similar tasks.


    Suitable positions for CCNL Terziario, Distribuzione e Servizi, per level. This classification is subjective and one of the main factors in determining the corresponding employment Level is wage.


    Visual Guide to Swiss Work Permits PDF Print

    Work_Permits_CHWhen considering employment in Switzerland for an expat, be prepared for a challenging process.


    All non-Swiss nationals wishing to come to Switzerland for employment purposes must have a valid passport, a Visa if necessary (issued at their home location by a Swiss Embassy or Consulate) and a Work Permit.


    Switzerland has high requirements towards foreign nationals and strict rules for obtaining a Work Permit. The complex compliance procedure is time-consuming, mostly due to the fast-ending quarterly quotas.


    Maps Division


    Switzerland applies differentiated procedures for EU/EFTA citizens and for third-country citizens (non EU/EFTA countries).


    *European Free Trade Association includes EU countries plus Switzerland, Norway, Iceland and Liechtenstein).

    Third Countries – rest of the world which does not benefit from the bilateral agreement entered into force on June 2nd 2002 (does not include USA and Canada).


    Swiss work Permit Eligibility


    Switzerland has strict requirements towards foreign nationals. The Federal Office for Migration (FOM) will take into consideration such skills and factors as:


  • age and ability to integrate into account
  • university degree, specific expertise and years of professional experience;
  • manager, specialist or other qualified level workers
  • The work permit will be granted only if there is no Swiss or EU/EFTA national available for the position and the established quotas allow it.

    Annual Quotas


    Swiss Work Permits are mostly limited, differing for each type of permit and applicant's nationality. They are subject to annually set quotas. The annual quota is divided and applied on a quarterly basis. The quotas are expected to be full by the middle to the end of each quarter, meaning that applications can delay until the quotas for the following quarter are released. To avoid rejections related to quota, applicants should submit the work permit applications in advance.


    Work Permit Types in Switzerland



    Work Permit Application Procedure


    EU/EFTA nationals are allowed to come to Switzerland for three months while they look for work. The period can be extended to six months, in specific cases, receiving a Permit L.


    The rest apply to Third Countries citizens:


    First, the worker has to find a job in Switzerland. The administrative procedures can be launched only after having a secure employment. Both the employee and the employer will have to complete their parts of the work permit application and submit it to the local cantonal employment service to review it and then pass it on to the Federal Office for Migration (FOM) for approval.

    It is imperative for the employee to have authority to work in Switzerland when he or she enters the country. Otherwise, he or she will be forced to leave Switzerland, return to the home country and apply there for the necessary acts. There is no possibility to enter Switzerland on a business trip, as a visitor or tourist and then remain for work purposes.

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