How are the "Personal Service Company" & "Personal Service Trust" tax statuses taxed?
The "Personal Service Company" & "Personal Service Trust" options become available in the Tax Status field when the employee is linked to the nature of person code: "H - Personal Service Provider".
Navigate > Employee > Basic Information > Tax Profile > Identification
Navigate > Employee > Basic Information > Tax Profile > Tax
When employees are linked to the Personal Service tax status, the percentage used in the tax calculation can be applied in two ways.
Option 1
In the event an employee is added for tax years ranging from 1 April 2019 to 30 March 2023, the system will default to a tax percentage of 28% as per the below.
The rate of tax for a company (other than a public benefit organization, recreational club or small business funding entity referred to in paragraph 5 or a small business corporation referred to in paragraph 7) in respect of any year of assessment ending on or after 1 April 2022 is 28%.
Option 2
In the event an employee is linked to the tax status on or after 31 March 2023 a 27% tax rate can be applied to the record. Enable the "Apply 27% tax for Personal Service Provider?:" checkbox under the Statutory Fields section on the Tax Profile screen. Thereafter, the system will automatically apply the 27% rate to the employee's record moving forward.
Navigate > Employee > Basic Information > Tax Profile > Statutory Fields
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