According to Velocity Global's employment agreement template, when is the salary due in Peru?

Salary in Peru is paid at the end of each month.

How is salary calculated and what components does it consist of in Peru?

In Peru, salary calculation includes several components:

• Basic Salary (Sueldo Básico): The agreed-upon amount between the employer and employee.
• Allowances: These may include allowances for transportation, meals, or family, if applicable.
• Bonuses: Additional payments, such as the Christmas and National Holidays bonuses, are paid annually.
• Overtime: Compensation for additional hours worked beyond the standard working hours.
• Profit Sharing: Payment based on the company's profits, applicable in some businesses.
• Gratifications: Additional payments for holidays or special occasions.
• Social Security Contributions: Deductions for health insurance and pension funds.
• Paid Vacation: Typically 30 days of paid leave per year.

Additionally, the salary calculation accounts for deductions such as pension contributions and income tax, covering both employer contributions and employee deductions.

How many salary payments are made per year in Peru?

In Peru, the number of salary payments made per year is as follows:

• Regular Payroll: 12 cycles
• 13th Salary: 2 payments per year

- From January 1 to June 30 - July deposit.

- From July 1 to December 31 - December 15 deposit.

• Compensation for Time of Service (CTS) Cycle: 2 payments per year

- From November 1 to April 30 - May deposit.

- From May 1 to October 31 - November deposit.

Is salary payment monthly and is payment standard at the end of the month in Peru?

In Peru, salary payments can be agreed upon to occur weekly, biweekly, or monthly between the employer and employee. Pebl opts to pay monthly, with payments made at the end of the month.

Should the employment agreement specify salary in monthly or annual amounts in Peru?

Employment agreements in Peru specify salary amounts on a monthly basis.

What tax and social security obligations do employees have in Peru?

• Non-residents in Peru are subject to a flat tax rate of 30% on their gross remuneration for services performed in the country.
• Residents are subject to progressive tax rates ranging from 8% to 30%.
• Personal income tax returns must be filed in March of the year following the taxable year. The actual filing date depends on the taxpayer's ID number.

What are the details of the statutory bonuses and 13th/14th-month salary, including the local name and payment schedule?

In Peru, employers are required to pay statutory bonuses to employees twice a year, known locally as gratificaciones. The payment schedule for these bonuses is in July and December, with each bonus equivalent to one month's salary. If employees have received commissions, the average of these commissions over the past 6 months is added to the bonus. If an employee leaves the company before July or December, the employer must provide a proportional bonus.

Additionally, companies with 20 employees or more have an obligation to distribute a share of the company's taxable profits. This payment amount depends on several factors, including the company's net profit, industry, the number of employee days and hours worked throughout the year, and the employee's salary. The distribution must occur within 30 days of the company's tax return submission.

Moreover, employees with 25 years of service with the same company receive a 25 percent service-time bonus, which increases to 30 percent upon reaching 30 years of service.

What are the details of the customary bonuses, including the 13th or 14th-month salary, and when are these payments typically made in Peru?

In Peru, some employers choose to offer bonuses to compensate for inflation. However, it is important to note that this bonus is not a mandatory requirement. Typically, when provided, such bonuses are paid on a quarterly basis.

What is the minimum wage information in Peru?

Effective January 1, 2025, the monthly minimum wage in Peru is PEN 1,130. Additionally, employees working night shifts, which are from 10 PM to 6 AM, will receive an additional 30% of their wages.