Health insurance and taxes for employees

Health insurance is administered on the basis of solidarity: health care services do not depend on the amount of social tax paid for a specific person. The Health Insurance Fund pays health care institutions for the cost of health care services for insured persons.

Employers pay social insurance tax amounting to 33% of the employee’s gross earnings (20% is used to fund pension insurance and 13%, health insurance).

Social tax in 2018 in a nutshell:

  • tax rate: 33% of gross earnings;
  • a monthly rate of 470 euros is the basis for payment of social tax;
  • the minimum monthly social tax is 155,10 euros (monthly rate 33% of the gross wages).

Income tax

Income tax is deducted from the employee’s gross wages each month. To take into account tax-free income, the employee must submit a written request to the employer. Tax-free income for a given month can be taken into consideration only in the case of one payer of earnings.

In 2018:

  • the income tax rate is 20%
  • annual basic exemption (non-taxable amount) per year is up to 500 EUR in a month and up to 6000 EUR in the year, but decreasing depending on the total income amount. If total amount of all income is 25 200 EUR in a year or more, there is no right to basic excemption at all.

Unemployment insurance

Unemployment insurance is a compulsory form of insurance that provides the employee compensation in the event of unemployment, collective layoffs and insolvency of employer.

In 2018:

  • the employee’s unemployment insurance rate is 1.6%
  • the employer’s unemployment insurance rate is 0.8%.

Funded pension

The mandatory funded pension payment is a payment calculated from employees’ income, which is used for funding the second pillar pension. Joining this system is voluntary for people born before 1983 and obligatory for those born in 1983 and later.

When an employee starts work, you will have to verify his or her status in the Pension Centre by entering his or her personal identification code.

The mandatory funded pension premium rate is 2%.

Minimum wages in 2018

  • Minimum hourly wage 2.97 euros
  • Minimum monthly wage 500 euros.

Last amended: 21-12-2017 15:49 | Compiled by: Tax and Customs Board