Q: What are the requirements in applying for social security number?
A: If the applicant is a Marshallese citizen, the following documents are required:
2. Copy of birth certificate with an authentication seal from the RMI Registrar of birth, death and marriage.
If the applicant is a U.S., FSM or Republic of Palau citizen, the following documents are required:
1. Original passport
2. Employment papers
3. Document stating the purpose of his/her stay in the Marshall Islands
If the applicant is not a Marshallese, US, FSM or Republic of Palau citizen, the following documents are required:
1. Original passport
2. Valid Entry permit issued by the Immigration Office
3. Valid Alien Registration Certificate issued by the Immigration Office
4. Valid Work Permit issued by the Labor Office (not required if applicant is an RMI Government employee)
5. Valid employment contract
Q: Can dependents of foreign workers apply for social security number?
A: The primary use of a social security number is for employment, and in certain cases, for school requirements. Unless the dependent is a student or finds legal employment in the Marshall Islands, and has submitted the above stated requirements, MISSA shall not issue a social security number.
Q: Are refunds given to non-Marshallese workers who decided to return permanently to their respective countries but have not earned enough quarters to be eligible for benefits?
A: NO. Contributions are non-refundable, unless the wage earner has two or more employers in the Marshall Islands (on the same period) and his or her quarterly contributions exceeded the required amount. If the wage earner reaches the age of 60, he or she may apply for a lump sum payment computed at 4% of the total cumulative taxable wages.
Q: If a worker has been deducted SS contributions but his or her employer failed to remit the amount to MISSA, can he or she apply for retirement benefits upon reaching retirement age?
A: Earned wages of an employee are computed based on actual payments by his or her employer. If, for example, out of the eighty quarters of contributions by the employee, fifty (50) quarters were not remitted to MISSA by the employer, then, only thirty (30) quarters of earned wages will be credited to the employee's wage history. Thus, the employee can not retire, even if retirement age has already been attained.
Q: In the past, there were Marshallese workers who have been employed and paid their social security contributions to Palau and FSM social security systems. Can these SS contributions be added to their social security contributions in the Marshall Islands in order for them to be eligible for benefits or get bigger monthly benefits when they retire?
A: YES. The Marshall Islands has entered into a totalization agreement with Palau and FSM. This agreement enables any Marshallese, Palauan or FSM citizen who is not eligible for a monthly old-age retirement benefit under the social security administration of any of these countries but has worked and paid social security contributions to two or all of the three countries, to combine his or her credited service earned under two or all three systems and becomes eligible for benefits.
Q: What earnings are subject to MISSA taxation?
A: Compensation of any kind, including without limitation any salary, wage, bonus, tip, stipend, allowance or fee, paid by the employer to or on behalf of the worker in cash or in any other form, but not including:
- all wages earned by foreign nationals who are exempt from tax imposed by the Republic, pursuant to the Compact of Free Association with the United States of America) (e.g. US citizens working for US contractors with USAKA in Kwajalein) and any other diplomatic acts (e.g. foreign nationals working in their respective embassies in the Marshall Islands and United Nations personnel);
- any wages or income earned from sources outside the Republic of the Marshall Islands;
- payments made by the employer as a result of an accident or sickness of the worker (other than sick leave), such as reimbursement of medical or hospitalization expenses;
- payments made to or on behalf of the worker or his beneficiary from a trust or annuity;
- payments made in cash or in kind, for casual labor not exceeding one week in any month of a quarter, if the work is not performed in the course of the employer's trade or business;
- reasonable housing and travel allowances (e.g. per diem); and
- all wages in excess of the maximum taxable wages of $5,000.00 per calendar quarter.
Q: Are owners of businesses still required to include their names in the quarterly tax returns and pay SS contributions?
A: YES. Business owners are considered as “self-employed” workers and shall be deemed to be both their own employers and workers and, accordingly, are required to pay to the Fund for themselves both the workers' and employers' contributions. For purposes of tax computations, the owners are deemed to have earned twice the amount of earnings paid to the highest paid worker reported by them within a quarter or the earnings they actually received, whichever is higher. If a business owner has no other worker, he or she shall be deemed to have earned within a quarter seventy-five percent (75%) of his or her gross revenue for the quarter.
Q: If a worker has no social security number, can his or her employer include him or her in the quarterly tax return and pay SS contributions?
A: YES. Having no social security number does not exempt anybody, including alien workers, from paying MISSA taxes. However, it is the obligation of both the worker and his or her employer to obtain a Social Security number from MISSA.
Q: Why are MISSA Tax Auditors examining the payroll records of employers and up to how many years are they authorized to audit?
A: Tax Audits are being conducted to determine whether employers, both Marshallese and foreigners, are declaring completely and accurately in their quarterly tax returns the gross taxable wages of their employees. Under the statute of limitations, MISSA is authorized to audit up to the last six (6) years of business operations.
Q: How much interest and penalties are imposed as a result of none or late payment of contributions and periodic installment payments for promissory notes?
A: MISSA charges interest of 12% per annum from the time the contributions fall due until they are paid in full. Moreover, MISSA, at the discretion of the Administrator, is authorized to impose a penalty of up to 100% of the total contributions and interest due thereon. In the event that the unpaid contributions, interest and penalties due are referred to the Legal Counsel for prosecution in court, the delinquent employer shall additionally be liable for all reasonable attorney's fees and cost of litigation.
Q. If an employer is assessed for tax deficiencies, can he or she pay in installment?
A: YES. MISSA is offering affordable payment plans to employers who cannot afford to pay in one single payment. The payment plan ranges from six to sixty months, depending on the total amount of tax deficiency and the number of quarters covered by the promissory note.