Taxes and Tax Services
Taxes
As result of your transfer, you will be responsible for all income taxes in both your current location and the new location, as per country specific tax rules and regulations.
Failure to comply may create issues with visa renewals, incur tax penalties which will be your responsibility and even in severe cases, involve penal punishment.
Some countries offer a special tax regime which provides a preferential effective rate of income taxation through reductions in the tax rate or the tax base. Obtaining this special tax status is the employee’s responsibility.
Tax Gross-up may be applied when the transfer related remuneration and services you receive under the International Transfer policy requires the company to provide the remuneration or services as a guaranteed net payment after taxes are deducted. Tax Gross-up is however limited to income and social taxes, and to a limited extent, the exit taxes in effect in certain countries.
Please review the Global Tax Policy for further details. Cisco shall have the right and privilege at any time it deems necessary and proper to amend, add, or delete provisions to and from the Global Tax Policy without prior notice.
Tax Briefing
Cisco has retained an international tax firm, Ernst & Young, to assist you with the understanding of your taxes, both in the current and new Payroll location.
You are required to meet with the tax vendor consultants both at current and new locations. These meetings are critically important to ensure tax and legal compliance are met and any risk for the Company due to your transfer is effectively managed.
You are encouraged to seek tax advice from your personal tax advisor at your own expense to determine the impact of any relocation payments upon your individual tax liability. You are also encouraged to save all of your relocation expense receipts for tax purposes.
The IRS provides tax information, forms and publications at no charge to the public at http://www.irs.gov.
Tax Preparation
In addition to the tax briefing, Cisco has retained Ernst & Young to assist you with the preparation and filing of your taxes, both in the current and new Payroll location for the year of transfer.
You will be fully responsible for all penalties and interest charges assessed by any tax authority due to your failure to (1) provide information to Cisco’s tax vendor, Ernst & Young, on a timely basis, (2) notify Ernst & Young of any significant personal income or investment transactions, or (3) cooperate with Cisco with respect to the tax gross-up process.
This letter, together with its attachments, states our entire understanding of your transfer remuneration and services. However, this letter does not modify, amend or supersede written Cisco agreements and policies that are consistent with enforceable provisions of this letter such as Cisco’s “Proprietary Information and Invention Agreement” and Cisco’s Arbitration Agreement. In addition, this letter, its attachments and their contents do not modify or supersede any local laws which may prohibit the application of other policies deemed corporate policies of Cisco Systems, Inc. such as the International Transfer policy or the Tax Policy. You should not sign this letter unless you understand it. You should also
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