ÁREA DE COLABORADORESBASQUE COUNTRY AND NAVARRA: Are you going to hire someone this holiday season?
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In temporary contracts, a minimum of 2% must be withheld. In case of extension, check if you need to regularize that type.
To calculate the amount to withhold, the compensations expected to be paid during the calendar year must be known, and the withholding rate must be consulted to know the applicable withholding percentage.
However, if your company hires workers with a contract lasting less than a year, you must apply a minimum withholding of 2%. Regarding this percentage, keep in mind that:
It is a minimum rate
The 2% rate applies even if the withholding rate results in a lower rate. However, if a higher rate results, that higher rate must be applied.
What happens if the temporary contract is extended?
The minimum rate of 2% must continue to be applied when the extension or renewal is also for a duration of less than a year. However, many companies act out of inertia and apply that minimum rate to all temporary contracts, even when they are extended for more than a year.
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