Week 53 processing in Payroll

Period table

For the processing of week 53, period 13 has automatically been extended in the properties of the period table. You can check this by selecting General / Configuration / Period settings / Period table. In the properties of the period table, you see the following:

Pay_Aantal en Basis op de loonstrook (10)

Note:

If you have to change the period table, we recommend you contact your consultant.

'Loonheffing'

The law on the wage tax dictates that 52 weeks should be used for the calculation of the 'Looonheffing'. This also applies to a year with 53 weeks.

Because the income tax tables also use 52 weeks, the annual maximums for 'arbeidskorting' and 'heffingskorting' are exceeded if an employee reaches the maximum. This also applies to those who are paid every 4 weeks and whose 53rd week's wage is processed in an extended 13th period or in an extra 14th period. This is how it is calculated in Profit too.

Some people think that this is not correct. We have therefore asked the Dutch Ministry of Finance for an official reply. We have received the following reply:

In the calendar years that have a 53rd week in case of the application of the weekly table (or the four-weekly table), you can calculate the deduction for this extra week in the usual way.

Because of this, not only is 53/52 x the annual amount of the 'arbeidskorting' and the general 'heffingskorting' calculated, but the brackets of the material rate are also extended by a factor of 53/52. This is inherent to the system that is incorporated into the 'Wet op de loonbelasting' and that sets the year to 52 weeks for the calculation of tax on a weekly wage time frame.

You can find this and related information in the Handboek Loonheffingen.

The misunderstanding concerning the maximisation of, in particular, the 'arbeidskorting', often arises because the taxpayer has to account for the amount of the 'arbeidskorting' granted. However, the reason behind this accounting is that the 'arbeidskorting' granted in the wage taxes can be important to the income tax in certain situations.