Overview

Capital

Currency United States Dollar (USD)

Taxes

Employer 6.20% - Social Security Tax
1.45% - Medicare
Up To 3.3% - State Taxes

Employee

Termination

Termination Process South Dakota follows “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.

Mandatory Benefits

Pension Fund Employer: contributes 6% of the total payroll per month for the employees pension funds.
Employee: contributes 6% of the monthly salary to pension fund

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.

Advance Notice While there is no official period required, the general practice is is 2 weeks.

Severance Pay South Dakota law does not either require or prohibit severance payments. It depends on the employer’s agreement with the employee.

Minimum Wage

General Minimum wage is $8.65 per hour.

Non Mandatory

Expat Benefits There are no official expat benefits. However different companies can offer special benefits for the expats working for them. Benefits differ from one company to another.

Payroll

Additional Employee Withholding

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 - 1.2%
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.

VAT

General The state sales tax is 4%. However, can be up to 6% depending on local municipalities.