The Christmas bonus, or aguinaldo, is one of the most anticipated perks for workers in El Salvador. It’s a yearly benefit that recognizes your hard work. But do you know how it’s calculated? When it’s due? Or how taxes apply? Don’t worry—we’ve got all the answers right here. And at Nieto & Nieto, we’re here to guide you every step of the way!
WHAT IS THE CHRISTMAS BONUS AND WHO GETS IT?
The aguinaldo is a mandatory yearly payment required by law (Article 196 of the Labor Code) that employers must pay to their workers. It’s a recognition of your service, and the amount increases depending on how long you’ve been with your employer.
Am I eligible for the Christmas bonus? Absolutely!
- If you’ve worked for the same employer for a full year or more, you’ll receive the full amount.
- If you started recently, don’t worry! You’ll receive a proportional payment based on how long you’ve worked up to December 12 (Article 197 of the Labor Code).
WHEN SHOULD YOU RECEIVE YOUR BONUS?
Employers must pay the aguinaldo between December 12 and December 20 of each year (Article 200 of the Labor Code).
HOW MUCH WILL YOU GET?
The amount depends on how long you’ve worked for the same employer. As stated in Article 198 of the Labor Code, the minimum amounts are:
- 1 to less than 3 years: Bonus equivalent to 15 days’ salary.
- 3 to less than 10 years: Bonus equivalent to 19 days’ salary.
- 10 years or more: Bonus equivalent to 21 days’ salary.
Example Calculation:
If your daily wage is $12.50 and you’ve worked for 4 years, your bonus will be:
$12.50 x 19 days = $237.50 USD
For those paid on commission or other non-salary arrangements, the daily wage is calculated by dividing your total ordinary earnings from the past six months by the number of working days in that period.
TAXES ON YOUR CHRISTMAS BONUS
Here’s the good news:
If your aguinaldo is $1,500 or less, you won’t pay income tax!
What if your bonus exceeds $1,500?
You’ll only pay taxes on the amount above $1,500.
- Example:
If your bonus is $2,000, taxes will only apply to the extra $500.
HOW TO MAKE THE MOST OF YOUR BONUS
- Pay off debts: Start the new year with a clean financial slate.
- Save: Build an emergency fund for unexpected expenses.
- Invest: Put your money into something that will grow in value.
- Treat yourself: It’s Christmas! Enjoy the holidays and share with loved ones.
EMPLOYERS: STAY COMPLIANT AND SHOW APPRECIATION
If you’re an employer, paying the aguinaldo on time and in full is not just a legal obligation—it’s also a great way to motivate and acknowledge your team’s hard work. Plus, it keeps you clear of fines or disputes.
Need assistance navigating labor law requirements? Nieto & Nieto has the expertise to ensure you stay on track.
WHY CHOOSE NIETO & NIETO?
At Nieto & Nieto, we understand the ins and outs of labor law. Whether you’re a worker with questions about your rights or an employer looking for guidance, our experienced team is here to:
- Simplify the process for you.
- Address your doubts and concerns.
- Ensure compliance with the law.
GET IN TOUCH WITH US!
Have questions about your aguinaldo? Need help with legal compliance? Contact Nieto & Nieto today.
Follow us on social media for more tips and updates. Let’s make this holiday season worry-free and enjoyable. 🎄✨
