Employer Tax Contributions

Tax Type	Rate	Base
Social Security Contribution (Employer)	8%	Gross wages (capped at $10,000 per quarter)
Social Security Contribution (Employee Withheld)	8%	Gross wages (capped at $10,000 per quarter)
Wage and Salary Tax (Employee Withheld)	Progressive rates	Gross wages
Health Fund Contribution (Employer)	3.5%	Quarterly earnings (up to $5,000 per quarter)

Filing & Compliance

• Monthly reports for wages, Wage and Salary Tax (WST) withheld, and Social Security Contribution (SSC) are due by the 15th of the following month.
• Annual reconciliation reports summarizing total wages, WST withheld, and SSC contributed for each employee are typically due by the end of January following the tax year.
• Quarterly Social Security and Health Fund tax returns and contributions are due within the ten-day period following the end of each quarter (e.g., April 10th for the quarter ending March 31st).

In the Marshall Islands, employee tax deductions primarily involve social security contributions and potentially health insurance premiums, with income tax calculated separately.

Employer Tax Obligations

• Social Security Contributions: Employers contribute 8% of each employee's gross salary up to a quarterly maximum of USD $10,000. The employer withholds an additional 8% from the employee's salary for their contribution, remitting both portions to the Marshall Islands Social Security Administration (MISSA).
• Health Insurance: Some employers offer health insurance and deduct premiums from employee salaries. Details vary based on the specific plan.
• Registration: Employers must register with MISSA and obtain an Employer Identification Number (EIN).

Employee Tax Deductions

• Social Security Contributions: Employees contribute 8% of their gross salary, matching the employer's contribution, up to the same quarterly maximum of USD $10,000. This is withheld directly from their salary.
• Health Insurance Premiums: If offered by the employer, premiums are deducted from the employee's salary.
• Income Tax: Calculated separately and not withheld from salary. The tax rate is 8% on the first USD $8,320 of annual income and 12% on any income exceeding that amount. Those earning below USD $5,200 have an exemption of USD $1,040. Note: An amendment in the Income Tax (Amendment) Act 2025 removed a previously proposed 16% bracket for higher earners.