Puerto Rico Payroll – Updated Puerto Rico Payroll Reporting and Filing Requirements

Puerto Rico has a payroll tax withholding. The PR W2 is different from the US W2, so be careful if you are filing W2 for PR. For more information on payroll tax rates and requirements:

Contact the PR Department of the Treasury at:

Department of Finance
post office box 9024140,
San Juan, PR 00902-4140
Telephone: (787) 721-2020

As of 2009, the Puerto Rico taxable wage base limit for unemployment wages is $7,000.00 and for disability wages is $9,000.00. PR HAS provision for quarterly salaries in magnetic media. For more information on unemployment and disability rates and requirements:

Contact the Puerto Rico Department of Labor at:

Department of Labor and Human Resources
Prudencio Rivera Martinez Building
Cra Muñoz Rivera 505
Hato Rey, PR 00918
Telephone: 787.754.5353
Fax: 787.756.1149

If you need to find a CPA:

College of Certified Public Accountants of Puerto Rico
Telephone: 787.754.1950
Fax: 787.753.0212

There is a provision for minimum wage in PR, and it varies by industry. There is a provision for reporting new hires in PR. Puerto Rico payroll law requires involuntarily terminated employees to receive their final pay by the next regular payday. In addition, the dismissed employee will be entitled to compensation based on the number of months and years worked in the company. There is a meal penalty for employees who work more than 5 hours without taking a meal break.

There is an overtime penalty for employees who work more than 8 hours in a 24-hour period. Example, if an employee starts every day at 9 am and on one occasion starts at 8 am, this employee has worked 9 hours in that 24-hour period that started at 8 am and must be paid overtime. There is a pay premium for employees who work on Sundays. As of 2009, that rate is $11.50 per hour.

Sick and vacation pay is required. The basic rule is that sick and increased vacation time is for employees who worked 115 hours or more in a month. Sick time is increased by 1 day per month and vacation time by 1.25 days per month.

The bonus is mandatory and must be paid before December 15 of each year. The accrual period begins on October 1 and ends on November 30. Any employee (even if laid off) who worked 700 hours or more will receive a Christmas Bonus. As of 2009, the bonus for companies with more than 15 workers is 6% of the profit of the accrual period up to a maximum of $600. For companies with 15 employees or less, it is 3% of the earnings of the accrual period up to a maximum of $300.

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