At present, the tax base for the calculation of prepayments of income tax on employment comprises gross income accounted by the employer for an employee for a particular calendar month plus related social security and health insurance premiums paid by the employer (i.e. super-gross wage). Since Antivirus C allows for the waiver of part of employer-paid social security premiums and state unemployment policy contributions (programme criteria are discussed in the article here), it is necessary to clarify how the super-gross wages of employees will be determined for particular calendar months.
After the amendment’s approval by the senate, the General Financial Directorate (GFD) issued information drawing attention of employers (taxpayers) to the fact that the amendment to the Act on Social Security Premiums and State Unemployment Policy Contributions will not have an effect on determining the tax base for the calculation of prepayments of income tax on employment (the super-gross wage). Employers (taxpayers) to which the programme applies will continue to increase the income of employees for the tax base determination purposes, usually by 33.8%. To determine the super-gross wage amount, taxpayers will thus have to additionally calculate social security premiums and state unemployment policy contributions despite the fact that the actual premiums for particular months might amount to zero.
According to GFD, the Income Tax Act deals with situations when mandatory insurance payments are reduced by other amounts, i.e. as a result of an actual decrease of the employer’s assessment base and not as a result of a formal reduction of the payment itself.
The waiver of premiums should not also affect the method of completing a certificate of the taxable incomes from dependent activity, the withheld tax prepayments and tax credits for 2020 in which in line 6 the employer should state the aggregate of mandatory insurance payments deriving from incomes stated in line 2 (i.e. the aggregate of additionally calculated insurance premiums for the purpose of determining the super-gross wage). The same approach will be applied when completing a certificate of the taxable incomes from dependent activity and the tax withheld using a special tax rate.
19th April 2021
8th April 2021
12th February 2021