How to calculate the retention of a worker with a fixed salary and variable?

Sometimes the calculation of the withholding is not an easy task, sometimes, is complicated to the extent that there are fixed and variable components. In this post I will explain to you step by step how to calculate them with a practical example, it is the best way of doing it because you will only have to change the amounts.

In our example, don Carlos García perceived remuneration with a fixed component and another variable, measured in function of some parameters, which are measured at the end of the year.

Example of calculation of retention of the employee

you In 2019 will perceive a remuneration fixed € 30,000 (€2,500 for 12 monthly installments, payable on the last day of each month) and variable compensation is expected to ascend to 6,500 euros.

you In 2018, these variable compensation amounted to € 6,000. The Social Security contributions paid by the worker is estimated at 1,500 euros per year, and knows that he is a member of a union that paid in 2018 by membership fees 300 euros, it is estimated a similar amount for 2019. Don Carlos García has been reported to doña Rocio (model 145) the following data:
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Who has 47 years old, is married with three children, who at the end of the year you will have met 18, 14 and 2 years, respectively. Both the spouse and the children of 14 and 2 years did not obtain income, while the oldest son has rented a garage that was received in the donation of his maternal grandfather, by which he perceives to 1,200 euros per year.

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That is a participant in a Pension Plan, that comes contributing directly to 3,000 euros per year.

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You are buying your home using financing for third party, with the right to deduction for investment in habitual dwelling. Because doña Rocío has periodically transient problems of treasury, in 2019 the Wage Guarantee Fund (FOGASA) pays to don Carlos 15,000 euros, in concept of wages corresponding to the months of march, April, may, and June of 2016.

 

How to calculate the retention of the worker’s remuneration fixed and variable?

The retention practice will be the result of applying to the total amount of the remuneration that is paid to a type or retention rate, expressed with two decimal places, that is calculated through the following phases:

Step 1: Determine the base for calculating the retention rate

The total amount of the remuneration to be taken into account by the payer to the practice of retention is the full amount that, in accordance with the contractual provisions 8 applicable, and other foreseeable circumstances, will meet to perceive the worker during the year. This amount shall include the salaries fixed and the variables are predictable, both in monetary and in-kind (excluding the income account), except:
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The corporate contributions to pension plans, a corporate social societies and mutual provident societies that reduce the taxable base of the Tax

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of The arrears that is appropriate to impute to previous years. For these purposes, are presumed variable compensation of a foreseeable, as a minimum, obtained in the previous year, unless the circumstances allow to prove objectively, by a lower amount. There is a special rule to determine the amount of the compensation in the case of manual workers who receive their wages for peons or wages daily, according to the which will be taken to these effects, the result of multiplying by 100 the amount of the peasants or daily wage daily.

Basis of the calculation of the retention

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Compensation committee fixed: 30.000

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variable Compensation: 6.500

REMUNERATION committee ANNUAL GROSS: 36.500

is Reductions (art 83.3)

Article 83.3 b (RIRPF) deductible Expenses: Include the “Social Security Contributions and mutual general mandatory officials, as well as the drawdowns by rights, liabilities and contributions to colleges, orphan, or similar entities”
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Social Security (1500)

Article 83.3 c (RIRPF) Other deductible expenses
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With the general character of eur 2,000 per year (2000)

Not applicable reduction yields the work as the amount of remuneration gross exceeds 14.450 euros, according to the table of the art 20 LIRPF.

Following the rules of personal income TAX, article 83.3 (e), in the matter of a perceiver to have more than 2 offspring with the right to the application of the minimum for descendants will be reduced in addition to the amount of 600 €. “When it comes to taxpayers who receive pensions and assets liabilities of the Social Security system and passive types or that have more than 2 offspring which give right to the application of the minimum by the descendants referred to in article 58 of the law, 600€” The conditions should be given in the descendants:
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the offspring is less than 25 years to the date of accrual of the tax (normally, on the 31st of December or on the date of death of the payer if he dies on a day other than December 31), except in the case of descendants disabled with a degree of disability equal or superior to 33 per 100, in which case you may apply the minimum family descendants, whatever their age, provided that all other requirements are met.

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the offspring live with the taxpayer. Among other cases, it shall be considered living with the taxpayer and the descendants, depending on the same, are hospitalized in specialized centers.

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That the descendant is not been obtained in the exercise income superior to 8,000 euros per year, excluding income exempt from the tax.

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You did not submit declaration of personal income TAX (self-assessment or draft properly signed and confirmed), regardless of the taxpayer with income above € 1800. In relation to this last requirement, must be made the following details

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More than two descendants (600)

BASIS OF the TYPE OF RETENTION spanning 32,400

Step 2: Determine the personal and family minimum for the calculation of retention

The personal and family minimum to calculate the type of retention (art. 84 RIRPF) will be the result of adding the minimum of the taxpayer and the minimum of descendants, ascendants and disability following, according to results of the personal and family situation communicated by the recipient to the company or disbursing entity using the model 145.

Applicable amount general according to the article 57.1 LIRPF “The minimum of the taxpayer will be 5,550 grant euros per year”
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Minimal contributor 5550

Minimum for descendants: For each descendant of the recipient that meets the requirements listed shall apply the following amounts:

– To 2,400 euros per year for the first
– 2,700 euros per year for the second
– €4,000 a year by the third party
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+ 2.400 + 2.700 + 4.000 + 2.800 = 11.900

Application of the rules of computing-general, for the purposes of determining the personal and family minimum to calculate the deduction type, the amounts of the minimum for descendants will be divided by 2, except that corresponding to 12 to descendants by which the perceiver had a right, exclusively, to the application of the entirety of the minimum by this concept, and has so stated in the relevant communication of your personal and family situation (model 145).
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(11.900) / 2 = 5950

MINIMUM PERSONAL AND FAMILY 11500

Step 3: Determine the share retention

Article 85.1 1) RIRPF “To calculate the type of retention referred to in article 83 of this Regulation will apply to the types that are engaged in the following scale”

is Quota Retention = Fee Scale income TAX + ((Base – Base up-Scale personal income TAX) x % Scale personal income TAX)

The basis of the type of Retention = spanning 32,400
Base up (Scale income TAX) = 20.200
Fee (Scale income TAX) = 4.225
Share rest (12.200 x 19,00%) = 3.660
Personal and Family minimum = 11.500
Share rest (11.500 x 19,00%) = 2.185
Fee retention 5.700

(Base fee without annuities – the minimum Quota for staff)

(4.225 + 3.660) – 2.185 = 5.700

SHARE RETENTION ACCORDING to TABLES: 5.700

TYPE OF RESTRAINT (Quota / Retention Remuneration gross) x 100

is (5700 / 36500) x 100 = 15,61%