deferred compensation的意思|示意

Deferred compensation refers to an arrangement whereby an employee agrees to receive a payment or a benefit in the future, at a time that has been predetermined in advance. This type of payment is normally considered a non-taxable benefit until the employee receives it.

Deferred compensation is most commonly used by executive level employees, managers, and directors. These employees often receive a bonus after meeting certain goals, or as part of their overall compensation package. This bonus is usually taxed at a lower rate than regular income, giving the employee a greater overall benefit.

In many cases, deferred compensation can also be used as a way to reward employees for their loyalty to the company. This is often done by providing a certain amount of money or other benefit to an employee if they stay with the company for a set number of years. This type of reward helps to retain top talent and encourages employees to stick with the company for the long-term.

Deferred compensation is also sometimes used to help fund retirement plans and other types of long-term investments. Many employers offer employees the opportunity to put part of their salary into a 401(k) or other retirement account, and the employer will match the contribution up to a certain percentage. This money is then placed in an investment account and is not taxed until it is withdrawn after retirement.

Deferred compensation can be a great way to reward employees and encourage them to stay with a company for the long haul. It can also help to fund retirement plans and other types of long-term investments, making it a valuable tool for both employers and employees.