Overview

Capital
Currency
United States Dollar (USD)

Taxes

Employer
6.20% - Social Security Tax
1.45% - Medicare Rate
Up To 7.47% - State Taxes
Employee

Minimum Wage

General

The minimum wage is $7.45 per hour.

VAT

General

The state sales tax is 6.25%.

Mandatory Benefits

Pension Fund

Employer:The state contributes 7.5% of the employee wages.
Employee:The employee contributes 7.5% of monthly wages. Contribution limit is $18,000.

Social Security

As of 2011, after the Tax Relief, Unemployment Insurance Re-authorization and Job Creation Act of 2010, the Social Security tax rate is 4.2 percent of an employee's wages. In addition, there is a limit to the amount of wages that are subject to Social Security taxes. In 2016, the taxable wage base is be $118,500

Advance Notice

Advance notice is 2 weeks.

Severance Pay

The severance payment depends on the agreement with the employer and employee.

Termination

Termination Process

TX follow “employment at will” doctrine which means both the employee and employer are allowed to terminate the employment at any given time without a reason Therefore at the time of termination, the employer must pay all the necessary wages up to the day of termination.

Payroll

Additional Withholdings
Federal:
1. Medicare - 1.45%
2. Social Security - 6.2%
3. Unemployment Tax - 6.0% and maximum taxable earnings are $7,000
State:
1. Unemployment Insurance - 2.7% with maximum taxable earnings of $9,000.
Federal:
1. Medicare - 1.45% (additional 0.9% contribution for employees earning less than $200,000)
2. Social Security - 6.2% with salary ceiling of $118,500
3. Unemployment Tax - 0%
State:
1. Unemployment Insurance - Voluntary contributions permitted.