Managing Displaced People and Expatriates

Displaced and expatriate employees are workers that are transferred to another country for a period of time. These types of workers can include foreign people working in Spain and Spanish people working abroad. Specifically, a displaced employee is an employee who is temporarily transferred to another country to attend to company business for a period of time less than or equal to one year. An expatriate employee is an employee who is transferred to another country to attend to company business for a period of time greater than one year.

PeopleSoft Global Payroll for Spain provides functionality to manage displaced and expatriate employees. This functionality includes management of social security contributions, taxes, and affected legal documents. Because an employee's payroll conditions can change when affected by transnational geographic mobility, PeopleSoft Global Payroll for Spain provides solutions for various payroll conditions.

PeopleSoft Global Payroll for Spain also provides the IRPF Tax Data Review ESP component (GPES_TAX2_RSLT) that enables you to view tax data that the payroll process generates for displaced employees that are considered resident workers. The system includes these employees in common tax reports, Model 111 and Model 190 reports, and pension plan reporting functionality for creating the Model 345 report. For those displaced employees who are considered non-resident workers for taxes purposes, the system calculates IRNR. You can use the IRNR Tax Data Review ESP component to review this IRNR data. The official reports that affect these employees are Model 216 and Model 296.

To manage displaced and expatriate employees:

1. Define the withholding percentage for nonresidents for each fiscal territory in the Non-resident Withholding field on the Calculation Data page of the Fiscal Territories ESP component.

   See Calculation Data Page.

2. Set up transnational mobility details for the employee on the Transnational Mobility page of the Maintain Tax Data ESP component.

   See Transnational Mobility Page.

3. Assign the appropriate earning and deduction elements to the employee through the Element Assignment By Payee page.

   See Reviewing Delivered Earning and Deduction Elements.

4. Run the payroll process.

5. Review the IRNR tax data for nonresidents through the IRNR Tax Review page and make adjustments if necessary.

   If the displaced employee is considered a resident for taxes purposes, you need to use the IRPF Tax data review page.

6. Create the IRNR tax document Model 216 for nonresidents monthly or quarterly using the Create 216 Model File ESP page (or corresponding Model 111 for residents).

7. Create the IRNR tax document Model 296 for nonresidents annually using the Create 296 Model File ESP page (or corresponding Model 190 for residents).

Use the IRNR Tax Review page (GPES_EXPT_RSLT) to view the impuesto de la renta de no residentes (IRNR) tax data for nonresident employees whom the payroll process generates and adjust data manually as necessary.

The system uses this data for IRNR tax documents.

Image: IRNR Tax Review page

This example illustrates the fields and controls on the IRNR Tax Review page. You can find definitions for the fields and controls later on this page.

When you run the payroll process, it stores the required statutory IRNR tax report information for nonresidents in the GPES_EXPT_RSLT table. You can use this page to view and adjust the IRNR tax data for specific employees. The report generation processes consider the values on this page when you generate the Model 216, Model 296, and Tax Deduction reports.

Use the IRNR Tax Data Review ESP - Accumulated Values page (GPES_EXPT_AC_VW) to review online the accumulated tax data that the payroll process calculates for IRNR tax reporting.

The system uses this data when you generate IRNR annual tax reports.

Image: IRNR Tax Data Review ESP - Accumulated Values page

This example illustrates the fields and controls on the Accumulated Values tab of the IRNR Tax Data Review ESP page. You can find definitions for the fields and controls later on this page.

Review the sum of each of the IRNR tax data values for the selected calendar year from January 1 through the selected month. The system displays the data by employee, key, and subkey. If you are viewing accumulated data for December, the December data is the same as the fiscal year data that gets included in the Model 296 file.

Use the Create 216 Model File ESP page (GPES_RC_TAX_216) to create the Model 216 report file.

This report is a summary of the monthly or quarterly IRNR nonresident income tax data. Companies with nonresident employees must submit this report monthly or quarterly to tax authorities.

Image: Create 216 Model File ESP page

This example illustrates the fields and controls on the Create 216 Model File ESP page. You can find definitions for the fields and controls later on this page.

Enter the report parameters. Then click Run to launch the GPES_TAX_216 Application Engine process to generate the Model 216 file report for nonresident income tax reporting. The process retrieves data for the affected employees from the GPES_EXPT_RSLT table. The report includes the summarized deductions for affected employees within a period of one month or three months, depending on your runtime parameters.

For the state territory, the process generates a flat file that you can electronically import into the official program provided by the tax authorities. The process also generates a free-format file that contains a readable summary of the information that you need to report. You can use this file as a reference when entering reporting data on the official website of the historical territory. The file name that the process generates for historical territories is the file name that you specify plus the letter S at the end.

Use the Create 296 Model File ESP page (GPES_RC_TAX_190) to create the Model 296 report file for expatriate nonresidents.

This report is a summary of the annual IRNR nonresident income tax data. Companies with nonresident employees must submit this report annually to tax authorities.

Image: Create 296 Model File ESP page

This example illustrates the fields and controls on the Create 296 Model File ESP page. You can find definitions for the fields and controls later on this page.

Enter the report parameters. Then click Run to run the GPES_TAX_296 Application Engine process to generate the Model 296 file report for nonresident income tax reporting. The process retrieves data for the affected employees from the GPES_EXPT_RSLT table.

The process generates a flat file that you can electronically import into the official program provided by the tax authorities. The process uses different formats for the file depending on the selected fiscal territory.

This topic describes the earning elements and deduction elements that are delivered as part of the special collective management functionality.