Fiscal Code Amendments regarding the calculation base for social and health insurance contributions

04/08/17

In brief

Government Ordinance no. 4/2017 amends Law 227/2015, regarding the Fiscal Code, on the employer calculation base for social insurance contributions and health insurance contributions.  

In detail

Calculation base for social insurance contributions and health insurance contributions due by employers and those treated as such

For employers and those treated as such, the monthly calculation base for social insurance contributions and health insurance contributions on salary income, and income treated as such, which is lower than the minimum gross salary and paid based on a part-time or full-time individual employment contract is set at the level of the minimum gross salary valid for the month for which such contributions are due, based on the number of working days the employment contract was active in that month.

Exceptions

The new amendments do not apply for the following employee categories:

a)    Pupils and students, up to the age of 26 years old, in formal education;

b)    Apprentices, as defined by law, up to the age of 18 years old;

c)    Disabled people who, as defined by law, can perform employment activities for under 8 hours per day;

d)    Individuals who retired at the age limit under the public pension system, with certain exceptions;

e)    Individuals with monthly salary income based on two or more individual employment contracts, if the total amount of salary income is at least equal to the minimum gross salary.

For the purpose of applying the abovementioned exceptions, employers have to request justifying documents from individuals in categories a, c and d.  The Public Finance Minister is to issue a Public Order establishing the application procedure for category e individuals.

The provisions of this ordinance come into force as of 1 August 2017 and apply to income obtained for August 2017. 

[Source: Government Ordinance no 4/2017 published in the Official Gazette. 598/25.07. 2017]

The takeaway

  • The monthly calculation base for social insurance contributions and health insurance contributions, due by employers and those treated as such, is set at the level of the minimum gross salary for individuals whose monthly gross salary income is below the minimum gross salary.
  • The new amendments apply to certain categories of employed individuals.

Contact us

Mihaela Mitroi

Partner, Tax Services, Romania

Tel: +40 21 225 3672

Ionuț Simion

Country Managing Partner, Romania

Tel: +40 21 225 3708

Daniel Anghel

Tax and Legal Services Leader, Romania

Tel: +40 21 225.3794

Diana Coroabă

Partner, Tax Services

Tel: +40 21 225 37 94

Ionuţ Sas

Partner, Tax Services, Romania

Tel: +40 21 225 3741

Contact us

Mihaela Mitroi

Partner, Tax Services, Romania

Tel: +40 21 225 3672

Ionuț Simion

Country Managing Partner, Romania

Tel: +40 21 225 3708

Daniel Anghel

Tax and Legal Services Leader, Romania

Tel: +40 21 225.3794

Diana Coroabă

Partner, Tax Services

Tel: +40 21 225 37 94

Ionuţ Sas

Partner, Tax Services, Romania

Tel: +40 21 225 3741

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