17 July 2012

Payroll Jurisdictional Requirements

As a global standards organization, HR-XML has developed most of its specification for the general population and extended those specifications for country and jurisdictional requirements. The Payroll industry is an exciting challenge as each country, province, state, city, etc. has its own rules, particularly when calculating taxes. For example, Canadian provinces utilize letters of waivers to authorize tax credits and deductions. Netherlands includes a tax credit for the elderly and Germany considers bargaining units when calculating taxes.

These and many other requirements must be discussed when developing the standard.

HR-XML recommends two options for handling these jurisdictional requirements. We build in the ‘known' requirements and include the UserArea for the ‘unknown' requirements. The initial PayrollMaster schema will include tax instructions for Canada, France, Germany, Netherlands, and the US as shown in the following diagram. Each of these modules contains information specific to that country and includes a UserArea for any new or unknown jurisdictional needs.

The HR-XML workgroups are open to corporate and individual members so if you'd like to contribute to the payroll standards, please sign up on the HR-XML website.