The member companies of the AFI are highly qualified consulting professionals that strive to help investors and businesses impacted by the COVID-19 situation in many different ways. Here, our members have prepared views and informed opinions on various aspects of the crisis. The article below has been prepared by the global leader in assurance, tax, transaction and advisory services - EY.
In connection with the adoption of the act on waiver of social security contributions applicable to certain employers (Antivirus C), about which we informed you in our previous Tax Alert HERE, the Ministry of Labor and Social Affairs published on its website a list of the most frequently asked questions and answers concerning the waiver.
The complete list of FAQ is available HERE.
From our point of view, the following points seem particularly interesting:
- Point 1 - Employers whose (selected) employees exceeded the maximum assessment base between March 2020 and the month for which the employers plan to utilize the insurance premiums waiver (i.e. the employee’s total gross income since the beginning of the year has exceeded CZK 1,672,080) shall include in the social security assessment base for the given month for the purposes of comparison with March 2020 also the income of these employees, which is not subject to the payment of social security contributions.
- Point 7 - Employers who paid out extraordinary remuneration in March 2020, such as annual bonuses, must use in the comparison of assessment bases the actual assessment base for March 2020. As a result, due to the (significantly) higher assessment base for March 2020, they will generally fail to meet the requirement of a maximum drop of 10% in the given month compared to March 2020.
- Point 9 - Employers who have already submitted the Social Security Report for June 2020 and have not claimed the waiver, although they meet all the conditions, can submit a new Social Security Report and use the waiver by 20 July. In Reports submitted after 20 July (and, by analogy, this should also apply to subsequent months), the employers will no longer be able to claim the waiver of insurance premiums.
If you have any questions, please contact the author of the article or your regular EY tax team.
The article may be found HERE.