How do you know whether to deduct tax as a main employer or as a secondary employer?

If it is unclear whether an employer should perform a prepayment deduction with reference to a table or a percentage rate, this must be clarified with the taxpayer. A note will be sent if several employers request an employee's table-based card on more than one occasion. This note is intended only as notification that, if you are unsure, you as an employer should clarify with the employee concerned as to whether you are the main or secondary employer.

If as an employer you have any questions about how to deal with this, you can contact us for guidance.

If you take on new employees during the year, it should be part of your appointment routine to clarify whether you are the main or secondary employer of the person you are taking on.How this is dealt with in practice in the payroll system will vary from system to system. The Tax Administration recommends that payroll systems suppliers define a specific option for main/secondary employer.

However, if you have not had clarification as to whether table-based or percentage deductions apply, you should deduct in accordance with a percentage rate.Section 5-1-4 (3) of the Tax Payment Regulation states:If it is unclear whether an employer should perform a prepayment deduction with reference to a table or a percentage rate, this must be clarified with the taxpayer. If the employer has not had clarification as to whether to tax by table or percentage rate, the employer shall tax by percentage rate.

You can also recommend that the employee applies for a percentage card in order to avoid tax deduction errors. In principle, anyone with several employers over time is issued with a percentage card, but the Tax Administration's calculations are usually based on income year 2015, meaning that changes made in 2016 are not captured.