Payroll and HR in Greenland

Payroll and HR in Greenland

Local Information

Local Time (LIVE):11:39 PM
Local Currency:$1 = kr6.12
Business Language(s):Greenlandic
Tax Year Dates:1st January – 31st December

 

Greenland is an autonomous territory within the Kingdom of Denmark. The vast proportion of the country is within the Arctic Circle, and around 80% of it is covered in ice. As the largest island in the world, it will come as no surprise to learn that Greenland’s chief exports are fish; non-fillet frozen fish, crustaceans, and processed fish. Greenland is also thought to possess around 13% of the world’s undiscovered oil reserves, and 30% of the world’s natural gas reserves. So far these reserves have been unobtainable, however, due to the effects of climate change, it’s thought that they could be accessed in the not too distant future. It’s for this reason that countries like the US and Russia want to establish their presence in the country.

From a business perspective, expansion into Greenland could give your company an ideal strategic position, as it makes it a suitable stopover point between the US and Europe. There are two international airports; Kangerlussuaq Airport which offers flights to Copenhagen in Denmark, and Ilulissat Airport has flights to Reykjavik in Iceland.

Company owners considering expansion into this part of the world must be fully aware of Greenland’s employment law. Our experts at IRIS FMP have a wealth of experience in navigating international HR and payroll law and are able to offer the guidance you need to ensure a seamless and fully compliant expansion venture.

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Details correct at time of publication. You should not rely on these details without first seeking professional international advice.

Payroll in Greenland

What tax considerations are there?

 

Personal Income Tax (PIT)

Residents of Greenland are liable to pay income tax up to the value of 44%, depending on the local amount stipulated by their municipality. This will apply to their worldwide income unless the resident is also considered a resident in another country as well.

Non-residents may be liable to pay limited tax on their income that derives from within Greenland. This too could be up to a value of 44%.

There are no social security contributions made by individuals in Greenland, however, employers must pay 0.9% on their payroll.

Corporate Income Tax (CIT)

In Greenland, resident companies must pay CIT on their worldwide income, apart from that derived from real estate abroad. Non-resident companies must pay CIT on profits that derive from a permanent establishment (PE) in Greenland.

The rate of corporate income tax in Greenland is 25% for both resident and non-resident companies. In addition to the 25% there is a 6% surcharge on the tax payable, making the true CIT rate 26.5%. Oil and mineral licence holders are exempt from the surcharge.

Companies with mineral exploration licences must pay a government royalty fee as a condition of being granted a licence. Similarly, mining companies must also pay a royalty fee.

Employer Must-Dos

Employers must submit the following in Greenland:

  • Corporate Income Tax Return should be filed within four months following the end of the financial year. This will be May 1st unless an alternative financial year has been agreed upon.
  • Corporate Income Tax must be paid by November 20th in the following year, and a fee of DKK 200 (roughly $30 USD) per day will be charged for every day CIT goes unpaid.

HR in Greenland

What are the regular working hours in Greenland?

Normal office hours in Greenland are between the hours of 8am and 5.30pm, with a 30-minute break for lunch, Monday to Friday.

Shops are generally open from 10am until 5.30pm on Monday to Thursday, 10am-6pm on Fridays, and 9am-1pm on Saturdays. Shops are generally closed on Sundays.

Vacation, maternity and sickness

Women in Greenland are entitled to 17 weeks of maternity leave, plus an additional 17 weeks of shared parental leave that can be split between the mother and the father. Women must take two of the 17 weeks prior to the birth, and the remaining 15 afterwards. If there are complications or pregnancy-related illness, it might be possible to start maternity leave earlier than two weeks before the due date.

Those who have worked for a period of 13 weeks or more, and a total of at least 182 hours in this time, will be entitled to an unemployment benefit whilst ill, in Greenland. This could be granted for a total of 13 weeks. The benefit will be paid from the third day of absence from work, unless the illness goes on for two weeks or more, or is work-related. In these cases the benefit will be paid from the first day of absence. Those off for a longer period of sickness, or who are off intermittently due to sickness, can apply for other kinds of social support in their municipality.

There are 11 national holidays per year in Greenland, on which employees are not expected to work apart from in special circumstances/sectors.

Understanding International Employment Law

To find out more about HR and payroll law all over the world, download our guide. We cover everything from global maternity leave policies to tax legislation.

Download Our Guide

IRIS FMP’s Greenland Payroll and HR Solutions

Those expanding into Nuuk, Sisimiut, Ilulissat, or another of Greenland’s towns, must be well-acquainted with all aspects of the local employment law. Understanding all the legislation that must be adhered to can cause additional stress for some business owners and HR teams, in an already trying period. To help your expansion run seamlessly, seek advice from the experts here at IRIS FMP. We have a wealth of experience in international employment law, and our services include:

  • Employment contracts
  • HR consultancy
  • Payroll processing
  • Processing tax and social security deductions
  • Managing payslips
  • Tax reporting
  • Benefits administration
  • Pension administration
  • Accounting services
  • Translation services
  • Year End Tax Reconciliation
  • Multiple currency payroll

Let IRIS FMP help you achieve compliance with Greenland’s Employment Laws

Business owners can be confident that with guidance from IRIS FMP, their company will be fully compliant with all local payroll and HR legislation in Greenland. Get in touch to achieve a seamless expansion.

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