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What is the difference between the payroll taxes to be paid in the journal entry and the wage tax return?
Rounding of the amount ‘Payroll taxes to be paid’.
In the ‘data specifications payroll tax return’ of the tax authorities there are calculation rules how to round off per section:
“Collective amounts must be declared in whole euros. All collective amounts may be rounded off (or truncated) in favor of the withholding agent. If a collective amount is the sum of the employee amounts, you first add up all unrounded employee amounts. Then you round off this amount.
Example of rounding off for the section Total wage for wage tax/premiums social security:
An employer has 5 employees. The wage tax and social security contributions amount per employee per month:
employee A: € 1,678.87
employee B: € 1,245.95
employee C: € 1,145.98
employee D: € 1,823.89
employee E: € 612,90
total € 6,507.59
As a collective amount of the wage for wage tax/premiums social security you can specify € 6,507 or € 6,508. In the event of a check on a condition involving amounts rounded off to whole euros, the tax authorities apply a rounding margin of € 1 per rounded amount.”
All our reports and documents show the unrounded amounts. Hence, there may be differences in the general ledger accounts relating to payroll taxes and the actual payroll tax return.