Tax changes for individual part-time labor contracts

Starting with August 2017, the tax for individual part-time labor contracts is changed.

Thus, effectively from 1 August 2017, the employers will have to pay for part-time employees the social contributions (CAS and CASS) at the level of the minimum gross wages in the country in force in the month for which the contributions are due, not in proportion to the actual salary, as is happening now.

The employees who work both based on a part-time and a full time contract, as well as pupils, students aged up to 26 years, apprentices, people with disabilities, certain categories of retired persons will be exempted from this new rule.

Specifically, the employers will be liable to pay contributions at the level of the minimum gross wages in the country (1 450 lei for a complete work schedule of 166 hours on average per month), regardless of the fact that the employee actually works only 2 hours or 4 hours per day.

Clarifications:

1. The Ordinance enters into force on 1 August 2017 and it will be applied on incomes for the month of August 2017, only for the employer’s contributions.
2. The Ordinance is only applied to incomes from salaries, or assimilated to salaries, that do not exceed the level of the minimum gross wage in the country in force during the month for which the contributions are due. More specifically, the Ordinance will not be applied to employees who obtain during the same month incomes from salaries or assimilated to salaries based on two or more individual labor contracts and the cumulative monthly calculation base for them is at least equal to the gross minimum wage in the country.
3. Very important: the income taken into account in determining the monthly calculation base for social security contributions due by employers or persons assimilated to them is the minimum gross wage in the country in force in the month for which the social security contribution is due, corresponding to the number of working days of the month in which the contract has been active.

For further information on matters related to the practical application of the Ordinance, please contact us by email at office@paulopol.ro.