American Economic Review: Vol. 104 No. 5 (May 2014)

Expand

Quick Tools:

Print Article Summary
Export Citation
Sign up for Email Alerts Follow us on Twitter

Explore:

AER - All Issues

AER Forthcoming Articles

Year-End Tax Planning of Top Management: Evidence from High-Frequency Payroll Data

Article Citation

Kreiner, Claus Thustrup, Søren Leth-Petersen, and Peer Ebbesen Skov. 2014. "Year-End Tax Planning of Top Management: Evidence from High-Frequency Payroll Data." American Economic Review, 104(5): 154-58.

DOI: 10.1257/aer.104.5.154

Abstract

Using Danish high-frequency payroll data and tax reform variation, we detect year-end tax avoidance among top managers. Five to seven percent of top managers exploit year-end tax planning strategies to save taxes. Around 30 percent of the top managers engaging in year-end tax avoidance do so by retiming bonus payments while the rest shift regular wage income. However, bonus timing is most tax-sensitive. When considering all of the top managers receiving a December bonus, we find that more than one-quarter retime the bonus payment, whereas only 5 percent of those not receiving a bonus shift regular wage income.

Article Full-Text Access

Full-text Article

Additional Materials

Authors

Kreiner, Claus Thustrup (U Copenhagen)
Leth-Petersen, Søren (U Copenhagen)
Skov, Peer Ebbesen (Rockwool Foundation, Copenhagen)

JEL Classifications

H24: Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes
H26: Tax Evasion
J31: Wage Level and Structure; Wage Differentials
J33: Compensation Packages; Payment Methods
M10: Business Administration: General


American Economic Review


Quick Tools:

Sign up for Email Alerts

Follow us on Twitter

Subscription Information
(Institutional Administrator Access)

Explore:

AER - All Issues

AER - Forthcoming Articles

Virtual Field Journals


AEA Member Login:


AEAweb | AEA Journals | Contact Us