Employment contract: Due
Employment contract: Due to his assignment in Brazil for a period of 10 months, a secondment contract or assignment contract must be issued to him, in which the regulations that deviate from the original employment contract are included. This includes, among other things, working hours, public holidays, additional remuneration, social security, taxes, etc. Base salary: The relevant salary in Brazil must be adhered to. This is generally not a problem for a person who is sent to Brazil from the Swiss salary structure. The underlying Swiss salary generally exceeds the Brazilian salary to be complied with. Remuneration: In addition, the employee must cover travel, catering and rental costs. As a rule, the employee is also provided with a car on site as well as a daily allowance to cover local expenses. Work permit law for Switzerland: If Mr Miller goes to Brazil for 10 months at a time and does not return in between, he would have to deregister in Switzerland and apply for quota-free re-entry. As a rule, however, the municipalities / migration offices allow the person to remain registered in such cases. However, we recommend clarifying this in advance in individual cases. Otherwise, Mr Miller must ensure that he returns to Switzerland at least once so that he does not stay abroad for more than 6 months at a time. If Mr Miller is the main permit holder, it must also be checked whether the assignment abroad could have an impact on the family in Switzerland from a permit law perspective. Work permit law for Brazil: In order to carry out his work in Brazil, he requires a work and residence permit in Brazil. As a rule, a local sponsor is required to obtain a work permit. In our example, this could be the customer in Brazil to whom the large installation was sold. The time it takes to obtain a work permit is often underestimated and the employee has to enter the country sooner. It should be noted that these entries are not welcomed by the destination country and could possibly be classified as an offence of circumvention. For this reason, it is important to consider the time frame for obtaining the permit when planning the project. Social security agreement: There is a social security agreement between Switzerland and Brazil that can be applied to all nationals. Consequently, this can also be applied to Mr Miller. 6 convinus.com
Social security subordination: Due to the existence of the social security agreement, Mr Miller can remain fully subject to the Swiss social security system, even if not all branches of insurance are mentioned in the agreement. Mr Miller's employer must apply for the secondment certificate via ALPS, which confirms that he will remain subject to social insurance in Switzerland during his assignment abroad in Brazil. However, due to the fact that not all social security branches are covered by the agreement, additional social security contributions may have to be paid in Brazil. If this is the case, the employer must consider whether to pay these contributions in full, including the employee's share. If you decide to do so, however, you must bear in mind that the Brazilian employee contributions paid represent a taxable and social security-liable salary component. Health insurance: Mr Miller can remain covered by Swiss health insurance during his assignment abroad, but additional international health insurance should be taken out for him for the period abroad. Swiss health insurance alone will generally not provide him with sufficient cover in Brazil. Double taxation agreement: There is a valid double taxation agreement between Switzerland and Brazil. Taxes in Switzerland: Due to the fact that Mr Miller continues to be resident in Switzerland for tax purposes during his assignment abroad, partly because his family remains in Switzerland, Switzerland has the right to tax his worldwide income and assets. Mr Miller has only been in Switzerland for two years, which means that his taxes may still be levied using the withholding tax procedure. Only if he earns a gross annual income of more than CHF 120,000 would he have to submit a tax return. The earned income from the Brazilian activity is subject to taxation in Brazil, as he spends more than 183 days in Brazil. Switzerland avoids double taxation by only taking the income into account for the progression proviso. Taxes in Brazil: Mr Miller will pay tax in Brazil on the earned income. The tax rate in Brazil is 27.5%. Depending on Mr Miller's individual tax rate in Switzerland, the tax rate in Brazil will be higher or lower.Regardless of whether taxation in Brazil is higher or lower than in Switzerland, employers should always consider how to deal with the differences. Usually, a tax equalisation process is implemented in which the employee is not better off from a tax perspective, but also not worse off. 7 convinus.com
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