Overview

Capital
Currency
Nicaraguan córdoba

Taxes

Employer
19% - Social Security
2% - INATEC
Employee
6.35% - Social Security
0-100,000 NC - 0%
100,001 NC - 200,000 - 15% above 100,000
200,001 NC - 250,000 NC - 20% above 200,000
350,001 NC - 500,000 NC - 25% above 350,000
500,001 NC + - 30% above 500,000

Minimum Wage

General
Minimum wage ranges within the nine economic sectors from 3,187.43 Nicaraguan Cordobas monthly (in the agricultural sector) to 7,133.44 Nicaraguan Cordobas monthly (in the financial sector).

VAT

General
VAT is 15% standard rate.

Mandatory Benefits

Pension Fund
The employer contributes 7% of employees wages.
Employees must contribute 4% of their wages, and voluntary contributions can be either 10% or 18.25%.

Payroll

Payroll Tax
1) Social Security: 21.50% for < 50 employees 22.50% for > 50 employees
2) Instituto Nacional Tecnológico: 2%
1) Social Security: 7.00%

Termination

Termination Process
To terminate employees, employers must request for termination from the labor inspection department. At the time of dismissal, the employee is entitled to remaining vacation pay and their annual bonus.
Advance Notice
Employees must provide 15 days notice.
Severance Pay
Those employed for up to 3 years are entitled to one months salary for each year employed. From 4-6 years of employment is entitled to 20 days salary for each year. Above 6 years of employment is entitled to 5 months salary.