North Macedonia is a landlocked country in southeast Europe that’s located on the Balkan Peninsula. It’s a great location for companies that want to create business ties in southeast Europe and expand across borders. However, your company has multiple areas to consider throughout the incorporation process, starting with payroll. You have to decide on a North Macedonia payroll option, set up your payroll to stay compliant with local labor laws, and continue to run both of your company’s locations.
Globalization Partners can make a difference with North Macedonia payroll outsourcing. We’ll hire employees as the Employer of Record and assign them to work for your company. Then, we’ll add them to our locally compliant payroll so that you don’t have to worry about setting up your North Macedonia payroll.
Taxation Rules
Employers in North Macedonia have to follow taxation rules for the company and employees. Your employees have to contribute 10% of their salaries as personal income tax, which employers withhold from all employees’ salaries.
On January 1, 2023, North Macedonia plans to implement new personal income tax rates:
- 10% tax rate up to MKD 1,080,000
- 18% tax on the difference of any income beyond MKD 1,080,000
- 0-15% tax on capital gains depending on the period of ownership
- 70% on income whose origin cannot be proved
As an employer, you also have to take the following contributions from salaries:
- 18.8% for pension and disability insurance
- 7.5% for health insurance
- 1.2% for employment insurance
- 0.5% for additional health insurance
Termination and Entitlement Terms
Sometimes terminating an employment contract can be more difficult than creating one. Including entitlement and termination terms in a contract ahead of setting up your North Macedonia payroll can protect both you and your employees. Typically, employers should find terminated employees new employment, pay for training, or give one month’s salary for every two years of service as a severance payment.
How To Set Up Your North Macedonia Payroll
If you expand to North Macedonia without the help of a global PEO, you’ll have to establish a subsidiary in the country before you can set up your North Macedonia payroll and hire employees. The incorporation process depends on a variety of factors, and it can take several weeks or even months before you can start working. Instead of losing valuable time, take advantage of the fact that Globalization Partners offers North Macedonia payroll outsourcing that can help you become productive sooner.
North Macedonia Payroll Options for Companies
Your business has several possibilities to consider for administering payroll overseas:
- Payroll processing company: In many countries, you can hire a local company to manage payroll requirements for you. However, you may need to pay high service fees, and you’ll be liable for any errors they may make in processing.
- Subsidiary: With a subsidiary, your company has a presence in-country to manage your local employees’ payroll. While highly convenient for administration, a subsidiary requires extensive resources to get established.
- Internal payroll processing: Managing payroll administration internally offers the benefit of reduced transactional costs for your company. However, your company will need to have dedicated resources and staffing to manage complex international payroll processing and compliance. You’ll also be liable for any errors that might occur.
- Global Employer of Record (EOR): Globalization Partners offers a solution for efficient and liability-free payroll processing. As your EOR, we provide in-country experts to manage payroll and compliance while taking on your company’s associated risks.
Trust Globalization Partners for Seamless Payroll Management
Globalization Partners wants to make your global expansion a little easier. Get in touch with us today.
