Updated on: 2025/08/04 14:35 (UTC)
Overview
Slovenia, which officially is known as the Republic of Slovenia, is located in the southern part of central Europe. There are 201 municipalities, or obcine, and 11 urban municipalities, or mestne obcine, in Slovenia. The countries that border Slovenia are Austria to Slovenia’s north, Hungary to its northeast, Croatia to its east and south, and Italy to its west. The Adriatic Sea borders Slovenia to its southwest. In the Slovenian language, also known as the Slovene language, the country of Slovenia’s name is Slovenija.
Slovenia’s currency is the euro.
Employers in Slovenia are required to withhold contributions for income tax and social taxes from an employee’s pay at the time of payment in addition to making their own contributions to social taxes. Employers also must uphold compensation and benefits provisions in the labor law.
Foreign workers in Slovenia generally are subject to the same tax and labor laws as Slovenian nationals. Foreign workers are taxed on their Slovenian sourced income while Slovenian nationals are taxed on their worldwide income.
Slovenian citizens working in the United States must comply with the appropriate visa requirements, labor and tax laws.
CURRENCY DETAILS
The currency of Slovenia is the euro (€), which Slovenia uses because it is part of the euro area, also known as the eurozone, which is a group of countries that adopted the euro as their currency. While the European Commission officially recognizes the spelling of the euro currency in Slovenian as in accordance with the commission’s standard spelling of euro, in common Slovenian parlance the currency’s name is spelled as evro. The internationally recognized three-letter currency code for the euro is EUR, which also is one of the currency’s two commonly used currency symbols. The English plural form of euro officially recognized by the European Commission is the same as its singular form, although in common English parlance the plural form is euros. In Slovenian, the plural forms of euro when spelled in that manner are eura, euri, and eurov, with usage depending on context, and the plural forms of evro when spelled in that manner are evra, evri, and evrov, with usage depending on context.
When an amount of euro is written using the currency symbol € in accordance with the European Commission’s standard placement treatment of the symbol, which is the placement treatment used for the English language, the symbol precedes the numerical value with no space between the numerical value and symbol. When an amount of euro is written in Slovenian using the currency symbol €, the symbol follows the numerical value with a space between the numerical value and symbol.
When an amount of euro is written using the currency symbol EUR, the symbol precedes or follows the numerical value with a space or no space between the numerical value and symbol.
One hundredth ( 1 ⁄ 100 ) of a euro is referred to in English as a cent and the English plural form of cent officially recognized by the European Commission is the same as its singular form, although in common English parlance the plural form is cents. In Slovenian, as officially recognized by the European Commission, one hundredth of a euro also is referred to as a cent and has the plural forms of centa, centi, and centov, with usage depending on context.
When amounts of euro are written in Slovenian, the comma that in English separates the thousands place from the hundreds place instead is rendered as a dot (.), and the dot that in English separates the ones place from the tenths place instead is rendered as a comma.
Digital Currencies: Slovenia does not consider digital currencies to be a monetary asset or a financial asset under Slovenian law on payment services and systems.
Taxation on digital currency is determined based on the facts and circumstances on each individual case.
Digital currency income earned by employees is generally subject to standard income tax provisions and is to be generally taxed by measuring the digital currency’s exchange rate with the euro at the time of the transaction. Personal income tax is not generally required to be paid on capital gains related to digital currency in Slovenia.
Digital currency distributed free of charge to employees by an employer is counted as income from an employment relationship. Salary, wage compensation, commissions, and other payments in the course of an employment relationship in the form of digital currency are included within the definition of employment income.
Nonresidents generally are subject to income taxes on all digital currency income with a source in Slovenia. Residents of Slovenia generally are taxed on worldwide digital currency income, which means that with regard to digital currency, employees are liable for the payment of personal income tax from all incomes that have a source in Slovenia and all income with a source outside Slovenia.
The European Banking Authority does not consider digital currencies to be legal currency. However, under a 2015 ruling by the European Court of Justice, bitcoin generally is considered a currency rather than a property for tax purposes in the European Union. Under the ruling, digital currency transactions are exempt from value-added tax (VAT) under a provision regarding transactions pertaining to currency, bank notes, and coins that are used as legal tender.
TAXES
The federal government generally enacts laws relating to income tax and social taxes.
The tax year is the calendar year, Jan. 1 to Dec. 31.
Coronavirus (Covid-19) Guidance: Effective for wages paid from July to December 2021, the minimum contribution base for social taxes is the minimum wage, instead of 60% of the monthly equivalent of the applicable average annual wage.
Employers that have suffered a decrease in their ability to generate income because of the pandemic may request postponements or installment payment plans for tax deposits, including for income tax withholding and social taxes, through eDavki until June 30, 2021. Postponements for up to two years and installment payment plans of up to 24 monthly installments may be requested.
Income Taxes
The Income Tax Act and the Tax Procedures Act are administered by the Tax Administration of the Republic of Slovenia (Financna uprava Republike Slovenije).
Coverage: Residents are taxed on all sources of income, domestic and international. Nonresidents only are taxed on income from Slovenian sources. Individuals are considered Slovenian tax residents if they reside in Slovenia, permanently or temporarily, for more than 183 days in a calendar year or they have a registered permanent address in Slovenia.
Employees: According to the Employment Relations Act, a worker is defined as any natural person who has entered into an employment relationship.
Rates and Thresholds: Income tax rates are levied on a progressive scale, with rates ranging from 16% to 50%.
Effective starting Jan. 1, 2020, Slovenia’s personal income tax rates and minimum and maximum amounts of annual income for each tax bracket are as follows:| Range of Annual Income (Euro) | Income Tax Rate |
|---|---|
| Up to €8,500 | 16% |
| More than €8,500 and up to €25,000 | 26% |
| More than €25,000 and up to €50,000 | 33% |
| More than €50,000 and up to €72,000 | 39% |
| More than €72,000 | 50% |
Registration: Employers must receive a tax identification number to register through the electronic one-stop shop, e-VEM. Tax information is transmitted through e-VEM and data is entered automatically to the Slovenian Tax Administration when it is received from e-VEM.
Employees must submit an application to the Tax Register of Slovenia for entry into the tax register using Form DR-02. The Tax Administration will issue the certificate on the allocated tax number within eight days after entry of a person into the tax register.
Taxable Amounts: All income in cash or in kind paid or given by an employer to an employee on account of employment is considered taxable income. Income from employment includes salary, annual leave compensation, awards and work-related compensation.
Nontaxable benefits include inheritance, insurance payments and indemnities, health and social welfare benefits, child allowances and child support, disability payments and state scholarships.
Withholding Methods: Employers are required to withhold income taxes, along with social taxes, based on the status of the payer of the tax for employees monthly under the pay as you earn (PAYE) system.
Returns and Remittance: Employers are required to electronically remit from each income tax payment through e-Davki using REK withholding forms on a monthly basis and no later than the date of wage payment to employees.
Employers also must provide employees with a yearly document of payroll salaries and allowances to employees no later than January 31.
Generally, individuals in Slovenia earning only income from employment do not have to file an annual return. Instead, the Tax Administration prepares an informative tax declaration by May 31 of the following year. This informative tax declaration becomes final if the taxpayer does not file a challenge to this informative declaration within 15 days of receipt of the declaration.
Individuals may file tax returns electronically or in a paper form.
Recordkeeping: Pursuant to the Labor and Social Security Registers Act, employers must keep records of employees, labor costs, working hours and other employment data. The required length of time to keep records could not be confirmed.
Penalties: Failure to uphold Slovenia’s Tax Procedures Act, including a failure to submit necessary forms or a delay in submitting necessary forms, can result in a fine ranging from €800 to €30,000.
Social Taxes
The Slovenian social security system includes numerous types of social insurance outlined in the Social Security Contributions Act.
The Pension and Invalidity Insurance Institute of Slovenia (Zavod za pokojninsko in invalidsko zavarovanje Slovenije, abbreviated as ZPIZ) administers mandatory pension and disability insurance (pokojninsko in invalidsko zavarovanje, abbreviated as PIZ), covering the risks of old age, invalidity, old-age care allowance, physical impairment and death. Employers and employees are assessed mandatory pension and disability insurance contributions.
The Health Insurance Institute of Slovenia (Zavod za zdravstveno zavarovanje Slovenije) administers mandatory health insurance (zdravstveno zavarovanje, abbreviated as ZZ), for which employers and employees are assessed contributions.
Employers and employees also are assessed contributions for employment (zaposlovanje, abbreviated as zaposl. and as zap.), which funds unemployment benefits, and parental protection (starsevsko varstvo, abbreviated as stars. var., as sta. var., and as SV), which funds parental paid leave.
Employers additionally are assessed contributions for insurance for injuries at work (zavarovanje za poskodbe pri delu, abbreviated as PD).
Coverage: All resident and nonresident workers are covered by the social insurance contribution system. All Slovenian employees and permanent residents are covered by health insurance.
Rates and Thresholds: Social security contributions are levied as a percentage on the employee’s earnings. Contributions are partly withheld by the employer from the employee’s gross remuneration and partly paid by the employer. The following contribution rates are those generally in effect for private company owners (lastniki zasebnih podjetij, abbreviated as LZP) and employees of such employers.
Private-sector employer contribution rates are as follows:
- pension and disability insurance: 8.85%;
- health insurance: 6.56%;
- employment insurance: 0.06%;
- parental protection: 0.1%; and
- insurance for injuries at work: 0.53%.
Private-sector employee contribution rates are as follows:
- pension and disability insurance: 15.5%;
- health insurance: 6.36%;
- employment insurance: 0.14%; and
- parental protection: 0.1%.
While employee and employer social insurance contributions for a month generally are based on all employment income paid to the employee for the month, if the employment income paid to the employee for the month is lower than the minimal monthly base, the employee and employer contributions would be calculated using the minimal monthly base instead of the employment income paid to the employee. The minimal monthly base is an applicable percentage of the government’s most recently determined monthly equivalent of the applicable average annual wage (average annual gross earnings) paid to employees.
Effective starting with 2021, the applicable percentage for determining the minimal monthly base is 60%. Effective for 2020, the applicable percentage for determining the minimal monthly base was 58%.
The average annual wage used for calculating the minimal monthly base typically is adjusted each Feb. 1.
Effective starting Feb. 1, 2021, the monthly equivalent of the average annual wage for calculating the minimal monthly base is the 2020 monthly equivalent amount of €1,856.20. Effective from Feb. 1, 2020, to Jan. 31, 2021, the monthly equivalent of the average annual wage for calculating the minimal monthly base was the 2019 monthly equivalent amount of €1,753.84. Effective from Feb. 1, 2019, to Jan. 31, 2020, the monthly equivalent of the average annual wage for calculating the minimal monthly base is the 2018 monthly equivalent amount of €1,681.55.
Registration: Employers must register the employee in the obligatory social security program through the e-VEM portal using Form M-1 no later than eight days from the commencement of work.
Taxable Amounts: All income in cash or in kind paid or given by an employer to an employee on account of employment is considered taxable income. Income from employment includes salary, annual leave compensation, awards and work-related compensation.
Withholding Methods: Employers are required to withhold social tax contributions from the employee’s pay along with income taxes.
Returns and Remittance: Employers are required to electronically remit social tax payments through eDavki using REK withholding forms on a monthly basis and no later than the date of wage payment to employees.
Effective since Jan. 1, 2019, employers established outside of Slovenia are required to remit social tax contributions based on payments to employees during a month by the 15th day of the following month using a form, Calculation of Social Security Contributions for Employees of Foreign Employers, or electronically using eDavki.
Recordkeeping: Pursuant to the Labor and Social Security Registers Act, the employer must keep records of employees, labor costs, working hours and other employment data. Personal data of employees must be deleted if there is no longer a legal basis to collect and retain it. Length of time required to keep records could not be confirmed.
Penalties: A failure to uphold the Tax Procedures Act, including a failure to submit necessary forms or a delay in submitting necessary forms, can result in a fine ranging from €800 to €30,000.
Other Taxes
Slovenia’s national government does not assess any taxes on employment income other than those covered in the Income Taxes and Social Taxes sections of this primer.
State/Jurisdiction Taxes
Taxes on employment income are not assessed by any of Slovenia’s obcine, mestne obcine, or local jurisdictions.
COMPENSATION AND BENEFITS
Employers must uphold the labor laws of Slovenia , which are regulated by the Ministry of Labor, Family, Social Affairs and Equal Opportunities. These laws provide regulations regarding minimum wage rates, overtime, hours of work, holidays, leave, wage payment, termination pay and workers’ compensation. Retirement plans are covered under social taxes.
Coronavirus (Covid-19) Guidance: Slovenia has two general wage-replacement programs. The first reimburses employers generally for 80% of an employee’s wages, up to the Slovenian average monthly salary in October 2020, when employers place employees on temporary leave because they cannot provide work, or must close because of official orders. Employers may optionally claim 100% of employees’ wages if they have received up to €1.8 million in state aid under applicable coronavirus intervention laws, or €270,000 of state aid for employers in the fishing or aquaculture sectors, or €225,000 of state aid for employers in the agricultural sector. The program includes salary compensation and social tax contributions for employees on temporary leave from Jan. 16 to June 30, 2021. For employers that are closed by official orders, the program includes salary compensation and all taxes, including employer social taxes. Employers are required to apply to the Employment Service of Slovenia within eight days of the start of the period of temporary leave.
This program was extended to the period from July 1 to Sept. 30, 2021, for full-time employees asked to work part-time for at least 20 hours per week. The program reimburses 80% of the wages from the hours not worked but is limited to half of the Slovenian average monthly salary in 2020, or €928.10. Employers must apply to the Employment Service of Slovenia within 15 days of asking an employee to work part-time.
From Dec. 8, 2020, to June 30, 2021, the second program provides reimbursements for wages paid when employees must quarantine and cannot work from home, when employers put employees on temporary leave for unavoidable reasons, or when employees cannot work because they must take care of children or otherwise cannot come to their workplace. Employers must apply to the Employment Service of Slovenia within eight days of the start of the quarantine or absence from work. The wages of quarantined employees are reimbursed in full, and 80% of the wages of absent employees are reimbursed, with a minimum reimbursement of the monthly minimum wage. Absent employees must provide the employer with a statement that they are unable to come to their workplace, which must be included with the application.
This program was extended to the period from July 1 to Dec. 31, 2021, for employees who must quarantine and cannot work from home, or when employees cannot come to work to protect children or because of public transportation cancellations or border closures.
Effective from Jan. 1 to June 30, 2021, employers may apply to the Ministry of Finance for subsidies of €50 per month per employee towards the wages of employees who earn the minimum wage. Applications must generally be made for a month by the end of the following month, but start March 20, 2021.
Employers must provide €200 allowances exempt from all taxes with wage payments for December 2020 and January 2021 to all employees who are working and whose most recent monthly salary was up to twice the minimum wage.
In September 2021, employers in listed sectors that had income decrease by more than 20% in 2021 compared to 2019 and 2020 may apply to the Tax Administration through eDavki for assistance paying employees’ required holiday allowances. The maximum assistance is €1,024 per employee.
Minimum Wage
The government of Slovenia generally adjusts the country’s minimum wage (minimalni placi) each year. The government designates a gross (bruto) pretax minimum wage amount and previously also designated a net (neto) minimum wage amount after taxes and deductions.
Effective for 2021, the gross monthly minimum wage is €1,024.24. Effective for 2020, the gross monthly minimum wage was €940.58 and the net monthly minimum wage after taxes and deductions was €699.93.
Starting Jan. 1, 2021, Slovenia’s minimum wage must be at least 20% higher, but not more than 40% higher, than the amount that the government determines to be the subsistence amount of costs for living in the country, adjusted for considerations of tax costs.
Overtime
Hours worked in excess of 40 hours per week are considered overtime. Overtime work may not exceed eight hours a week, 20 hours a month or 170 hours a year. Overtime may be extended to up to 230 hours per year with the written consent of the employee. Employees are entitled to an increased wage in cases of overtime work, the amount of which must be established in the collective bargaining or employment agreement. No general statutory provisions apply in this regard.
Hours of Work
The maximum workweek is 40 hours and a typical work day is eight hours.
Employees are entitled to a daily rest period of at least 12 consecutive hours in a 24-hour period and a weekly rest period of at least 24 consecutive hours.
Night work is considered to span from 11 p.m. to 6 a.m. A worker must have at least three hours during a day or at least one-third of his or her total working hours occur during this span to be considered a night worker.
Holidays
The following paid national holidays are observed in Slovenia:
- Jan. 1-2: New Year’s Day
- Feb. 8: Preseren Day
- Easter Sunday and Monday
- April 27: Day of Uprising Against Occupation
- May 1-2: Labor Day
- Whit Sunday/Pentecost, usually celebrated in May or June
- June 25: Statehood Day
- Aug. 15: Assumption
- Oct. 31: Reformation Day
- Nov. 1: Day of Remembrance of the Dead
- Dec. 25: Christmas
- Dec. 26: Independence and Unity Day
Leave
Every employee is entitled to at least four weeks of paid annual leave (20 days in case of a five-day week, 24 days in case of a six-day week), of which at least two weeks must be taken consecutively. Employees who were hired in the current year must receive 1 ⁄ 12 of their annual leave entitlement for each month for which they are employed in the current year, rounded up to the nearest full day.
Some categories of employees, such as elderly or disabled employees or employees nursing a disabled child, are entitled to up to three additional days of leave.
Employees must receive at least one additional day of leave for each of their children under the age of 15.
Employers must provide employees with a holiday allowance of at least the monthly minimum wage. The allowance must be paid by July 1 of each year. Employees who began work in the current year are entitled to a proportional amount of the holiday allowance.
Effective May 4, 2019, starting with leave received in 2019, the portion of the holiday allowance up to the most recently published average monthly salary of employees in Slovenia, as determined by the Slovenian Statistical Office (Statisticni urad Republike Slovenije), is exempt from income tax and pension and disability insurance contributions.
Personal leave: Employees are entitled to paid absence from work for up to seven days annually because of personal circumstances. Employees are entitled to at least one day of leave for specific cases such as marriage, the death of a family member, or a serious accident suffered by the employee.
Employees who take part in an education or training course have the right to be absent from work on days when they take the exams for the first time, even if the education or training is only in their own interest.
Sick Leave: Employers must compensate employees with 80% of their average monthly wage for full-time work during the past three months in cases of illness or injury not related to work for the first 30 business days of sick leave.
Employees are entitled to take leave on the day they are donating blood, with compensation covered by health insurance.
Collective bargaining agreements may prescribe more favorable wage compensation for sick leave.
In the event of longer absence from work, compensation is covered by health insurance.
Maternity leave: Female employees have the right to take up to 105 days of paid maternity leave, of which at least 15 days are obligatory.
Maternity leave may begin 28 days before the estimated date of birth.
The maternity benefit is calculated using an average based on the amount liable for parental protection contributions during the previous 12 months. In cases of full absence from work, the maternity benefit amounts to 100% of the employee’s average earnings in the last year and cannot be lower than 55% of the minimum wage.
Paternity leave: Upon the birth of a child, the father is entitled to 30 days of paternity leave. This right is nontransferable. The father must use 15 of his paternity leave days, either in the form of full or partial absence from work, by the time the child is six months old. The father may use the remaining 15 days, in the form of full or partial absence from work, after the expiration of parental leave and until the child finishes the first grade of primary school at the latest.
Parental leave: In addition to maternity and paternity leave, each parent is entitled to 130 days of paid parental leave. The father can transfer his right to the mother and the mother can transfer a maximum 100 days to the father.
Wage Payment
Remuneration for work is composed of the wage, which must always be paid in a monetary form. Other components like payment period, payment day and manner of payment of wages are stipulated in employment contracts.
Wages must be paid no later than 18 days after the end of the payment period.
Employers are required to provide employees with a pay slip showing the details of salary, allowances, reimbursements and other benefits.
Bonuses and Special Benefits
Slovenia does not mandate employers to provide bonus payments to employees.
Termination Pay
If the employer terminates the employment agreement because of a business reason or the employee’s incompetence, the notice period varies between 15 and 80 days depending on the employee’s years of service with the employer. In case of employment up to one year, 15 days of notice is required, while 30 days is required for employees who have been employed from one to two years.
For every subsequent year of service, the notice period is extended two days up to a maximum 60 days. For periods of service above 25 years, a notice period of 80 days is required.
In cases of termination for business reasons or employee incompetence, employers must pay severance based on the employee’s average monthly wage during the last three months of employment. The severance payment amounts to:
- one-fifth of the basis for each year of employment with the employer, if the employee has been employed from one to 10 years;
- one-fourth of the basis for each year of employment with the employer, if the employee has been employed over 10 and up to 20 years; and
- one-third of the basis for each year of employment with the employer, if the employee has been employed for more than 20 years.
Unless the employment agreement states otherwise, the maximum severance payment is 10 times the employee’s average monthly wage.
Employees whose contracts are terminated prior to the end of the calendar year are entitled to one-twelfth of the annual leave for every month of service in a calendar year.
Severance payments are taxable.
Workers’ Compensation
Workers’ compensation is covered under social taxes. In cases of accidents at work or occupational disease, employees are entitled to 100% of their average monthly wage for the first 30 days for full-time work during the past three months.
Recordkeeping
Personal data of workers for the collection of which a legal basis no longer exists should be deleted and ceased to be used by the employer.
FOREIGN WORKERS
Foreign workers generally are entitled to the same rights as Slovenian citizens and covered by the same tax and workplace laws.
Visas: Slovenia is part of the Schengen Zone, which allows free movement of goods and people through many countries in Europe. Individuals entering Slovenia from within the Schengen Zone can stay in Slovenia for 90 days in a 180 day period without a visa. Foreign workers from the United States also are entitled to this amount of stay.
Specially skilled foreign workers can also obtain an approved EU-wide work permit, or Blue Card, at a Slovenian embassy or consulate in country of origin. Alternatively, employers can apply to the competent administrative unit in Slovenia. Individuals who receive the Blue Card must be paid at least 1.5 times the average monthly salary of Slovenia.
Taxes: Nonresidents with Slovenia-sourced income are liable to taxation only on that income at the same rates as residents—between 16% and 50%.
Wages/Payments: Slovenia does not have any special requirements for wages or payments due to nonresidents or foreign workers.
WORKING IN THE UNITED STATES
Foreign workers from Slovenia must meet general visa requirements and be certified to be employed in the U.S. General visa requirements for the U.S. are included in the separate
Slovenia is eligible for the visa waiver program for business visitors, which allows Slovenian citizens to travel to the U.S. for 90 days or less for business-specific purposes without having to obtain a B-1 business visa. Stays longer than 90 days will require a visa. Individuals may return to the U.S. under the visa waiver program if a “reasonable length of time” has passed. The determination for a reasonable length of time is at the discretion of the Department of Homeland Security.
Slovenian workers also are eligible to work in the U.S. under H-2B visas, which cover labor or services of a temporary or seasonal nature in occupations other than agriculture or registered nursing. The number of H-2B visas issued each year is limited by U.S. law.
U.S. employers also must check the names of all new-hires and employees against the Specially Designated Nationals and Blocked Persons List, administered by the Treasury Department’s Office of Foreign Assets Control (OFAC). Because OFAC prohibits financial transactions with individuals on the list, U.S. employers cannot employ them and may face fines for failing to comply.
For tax purposes, Slovenian citizens are subject to U.S. employment-based taxation on income earned in the U.S. unless they can claim an exemption under certain tax treaty provisions or they work under specific visa types that exempt earnings from taxes.
Slovenia has a tax treaty and a totalization agreement with the U.S.
State and local taxation of Slovenian workers also can apply, although some states within the U.S. recognize international tax treaties that can eliminate that income tax liability for foreign workers.
The U.S. labor laws apply to all workers employed and providing services in the country.
Work eligibility as an employee is contingent upon Department of Homeland Security and Labor Department approval and the employee receiving a U.S. Social Security number from the Social Security Administration.
Tax Residency: In general, employees working in the U.S. on a temporary basis are considered nonresidents for tax purposes unless they qualify for resident status. Employees can be granted permanent resident status through the so-called green card test or if they meet the substantial presence test under the U.S. tax code. More information on these requirements is in the
Permanent residents are subject to U.S. tax requirements the same as U.S. citizens and are taxed under the U.S. system on their worldwide earnings.
Income Taxes: Generally, nonresidents in the U.S. who are from Slovenia and are working in the U.S. are subject to U.S. taxes based on their U.S.-sourced income. Income is taxed differently based on whether it is categorized as wage income or nonwage income, which includes interest and dividends.
A Form W-4, Employee’s Withholding Certificate, must be filed by each employee with their employer. All nonresidents in the U.S. who are from Slovenia and are working in the U.S. must claim “single” in Step 1c, regardless of marital status; write “Nonresident Alien” or “NRA” in the space under Step 4c of the form; and may not claim “exempt” in the space under Step 4c.
Nonresident alien employees may adjust withholding using Step 2b or 2c of the Form W-4; certain employees also may be able to use Steps 3, 4a, or 4b. More information about Form W-4 requirements for nonresident alien employees is available in the
Although the versions of Form W-4 issued in 2020 or later significantly differ from the versions issued in 2019 or earlier, nonresident employees that filed a valid version of Form W-4 from 2019 or earlier with their employer do not need to file another Form W-4 with the employer unless they need to implement a change for their withholding. On Forms W-4 issued in 2019 or earlier, nonresident alien employees were required to check the “single” box on line 3, regardless of marital status; write “Nonresident Alien” or “NRA” above the dotted line on line 6; and were not permitted to claim “exempt” on line 7 of the form.
An additional amount is added to a nonresident alien employee’s wages for calculating federal income tax withholding, with the amount based on pay period frequency and the date of the employee’s most recently filed Form W-4. The table of additional amounts applicable to Forms W-4 from 2020 or later and the table applicable to Forms W-4 issued before 2020 are available in the
Nonwage income and self-employed foreign workers can be subject to income tax withholding at a flat rate of 30%.
Additionally, foreign workers may be taxed differently based on the specific type of visa they hold.
Tax treaties: Slovenia and the U.S. have a tax treaty with provisions addressing host country taxation of the nonresident workers. A summary of those benefits is listed in the Tax Treaty Exemption Comparison Chart. To claim the tax treaty benefit, the nonresident must file Form 8233, Exemption From Withholding on Compensation for Independent (and Certain Dependent) Personal Services of a Nonresident Alien Individual, with the employer.
Students, trainees, teachers and researchers in particular must include a statement with Form 8233 to claim a tax treaty exemption from withholding of tax on compensation for dependent personal services. This statement affirms that the teacher or researcher is temporarily in the U.S. for purposes of studying or has accepted an invitation by the U.S. government (or by a political subdivision or local authority) for the purpose of teaching or engaging in research for a period not expected to exceed two years by a university or other recognized educational institution in the U.S. It also must affirm that the individual will receive compensation for services performed in the U.S. The student exemption is not to exceed $8,000 a year; no limit is placed on the teacher or researcher compensation for Slovenian citizens.
Examples of the statements necessary to claim a treaty exemption from U.S. taxes are included in Internal Revenue Service Publication 519, U.S. Tax Guide for Aliens.
Social Taxes: Most foreign workers are subject to paying into the U.S. Social Security system. Foreign nationals who are exempt from paying income tax and who do not have the eligibility to receive a social security number may not be required to pay social taxes. Foreign workers contributing to Social Security for a certain time period may be eligible to receive benefits.
Generally, foreign workers in the U.S. that have specific visas as exchange visitors or students or who are temporarily in the U.S. for agricultural work are not subject to social taxes on income that is obtained from the purpose in which they originally entered the U.S.
Totalization Agreements: Social Security totalization agreements can allow foreign workers and U.S. nationals working abroad to avoid paying into two social security systems while being subjected to losing benefits for their home country system. Under totalization agreements, generally, foreign workers will only pay into one of the social security systems, either the home or the foreign system, but not both. Foreign nationals, utilizing a totalization agreement, also can count years of contributions paid to different social security systems to all of the systems they have contributed to in order to be eligible for benefits in one country.
Starting Feb. 1, 2019, Slovenia and the U.S. have a totalization agreement in effect with each other. A summary of the agreement’s provisions is included in
Wage Payment: Under certain visas for certain types of employment, employers are required to pay foreign workers the higher of either the prevailing wage or the actual wage that is paid to U.S. workers that have similar skills and qualifications.
There are no particular requirements that employees be paid in U.S. dollars.
TREATY ARRANGEMENTS
Slovenia has entered into more than 55 income tax treaties, including an income tax treaty with the United States. Starting Feb. 1, 2019, Slovenia also has a totalization agreement in effect with the United States.
The countries with which Slovenia has a bilateral income tax treaty in effect are Albania, Armenia, Austria, Azerbaijan, Belarus, Belgium, Bosnia and Herzegovina, Bulgaria, Canada, China, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Georgia, Germany, Greece, Hungary, Iceland, India, Iran, Ireland, Israel, Italy, Japan, Kazakhstan, Kosovo, Kuwait, Latvia, Lithuania, Luxembourg, Macedonia, Malta, Moldova, Montenegro, Netherlands, Norway, Poland, Portugal, Qatar, Romania, Russia, Serbia, Singapore, Slovakia, Spain, South Korea, Sweden, Switzerland, Thailand, Turkey, Ukraine, United Arab Emirates, United Kingdom, United States, and Uzbekistan.
Slovenia also has an income tax treaty in effect with the Isle of Man, which is a crown dependency of the United Kingdom.
Slovenia has totalization agreements for social tax purposes with 20 countries. The countries with which Slovenia has agreements are Argentina, Australia, Austria, Belguim, Bosnia and Herzegovina, Canada, Denmark, France, Germany, Luxembourg, Macedonia, Montenegro, Netherlands, Norway, Serbia, Slovenia, South Korea, Sweden, Switzerland, and the United States. Slovenia also has an agreement with the Canadian province of Quebec.
RESOURCES
All resources are in English unless otherwise noted.
General
Government of Slovenia
CIA World Factbook: Slovenia
U.S. State Department: U.S. Relations With Slovenia
Currency Details
Unicode Consortium: Currency Symbols
International Organization for Standardization: Currency Codes - ISO 4217
United Nations: United Nations Terminology Database: Slovenia
Taxes
Ministry of Finance (Slovenian)
E-vem portal for companies (Slovenian)
Income Tax Act (Slovenian)
Income Tax (Amendment) Act, Law 2929 of 2019 (Slovenian)
Covid-19 Postponement of Tax Payments and Frequently Asked Questions (Slovenian)
Compensation and Benefits
Ministry of Labour, Family, Social Affairs, and Equal Opportunities (Slovenian)
Employment Relations Act (Slovenian)
Government of Slovenia: Holidays in Slovenia
Act No. 003-02-7/2018-3, Act Amending the Minimum Wage Act (Slovenian)
Act No. 411-01/21-12/78, Act on Additional Measures for Mitigation of Consequences of Covid-19 (Slovenian)
Act No. 411-01/21-58/47, Act on Intervention Measures to Assist the Economy and Tourism in Mitigating the Consequences of the Covid-19 Epidemic (Slovenian)
Employment Service of Slovenia, Intervention Measures to Reimburse Salary Compensation (Slovenian)
Foreign Workers
Ministry of the Interior: Employment and Work
Working in the United States
U.S. Department of Labor:
- Foreign Labor Certification:
- Hiring Foreign Workers
U.S. Internal Revenue Service:
- IRS Notice 1392, Supplemental Form W-4 Instructions for Nonresident Aliens
- IRS Publication 15, Circular E, Employer’s Tax Guide
- IRS Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities
- IRS Publication 519, U.S. Tax Guide for Aliens
- IRS Publication 901, U.S. Tax Treaties
U.S. Department of State, Visa Waiver Program
Treaty Arrangements
Ministry of Finance: International Taxation (Slovenian)