Social Insurance Fund contributions increase and National Health Insurance System contributions commence in 2019
With this circular we would like to inform all of our associates that in 2019, an increase in Social Insurance Fund (SIF) contributions will come in effect and that contributions for the implementation of the National Health Insurance System (NHIS) will commence on the 1st of March 2019.
Social Insurance Fund (SIF) contribution increase
According to the provisions of the Social Insurance Law of 2010, both employer and employee contributions on insurable earnings to the SIF will increase by 0,5%, from 7,8% to 8,3%, as from 1st of January 2019.
Social Insurance Contributions 2019 rates
|
Fund |
Employer |
Employee |
|
Social Insurance |
8,3% |
8,3% |
|
Redundancy |
1,2% |
- |
|
Training and Development |
0,5% |
- |
|
Social Cohesion |
2,0% |
- |
|
Total |
12% |
8,3% |
The rate of Social insurance contributions is applied to a maximum level of emoluments. The maximum level of emoluments for 2019 is €54.648 (weekly €1.051 / monthly €4.554). Contributions to the Social Cohesion Fund are calculated on actual earnings, not subject to the above cap.
The contribution of self-employed as from the 1st of January 2019 will be revised to 15.6% on income. The maximum amount of insurable earnings is €1.051 per week. The lower weekly limit depends on the occupational category.
National Health Insurance System (NHIS) contribution
According to the National Health Insurance System Law of 2010 (as amended in 2017), employer and employee contributions for the implementation of the system commence the 1st of March 2019.
Under the NHIS Law as from the 1st of March 2019, the employers will contribute 1,85%, and the employees will contribute 1,70% on the employee’s gross earning up to maximum annual earnings of €180.000 (as earnings are defined in the Social Insurance Law) (with the exception of categories (2), (4) and (5) as stated in the below table); the insurable earnings limit of SIF contributions does not apply in this case. The employer is responsible for paying both their own and their employees' contributions through Social Insurance Services (by means of deduction from their salary).
Contributions relating to the implementation of the National Health System (NHS) will start from the 1st of March 2019, and will increase from the 1st of March 2020 as per the table below:
|
Ref |
Contributor’s Category |
Applied on |
Phase Α 01/03/2019 |
Phase B 01/03/2020 |
|
(1) |
Employees/pensioners/income earners (rental, interest, dividend and other income)/ Persons holding office |
Own emoluments |
1,70% |
2,65% |
|
(2) |
Employers |
Employees’ |
1,85% |
2,90% |
|
(3) |
Self-employed |
Own income |
2,55% |
4,00% |
|
(4) |
The Republic of Cyprus or Natural/Legal person responsible for the remuneration of Officers |
Officers’ Remuneration |
1,85% |
2,90% |
|
(5) |
The Republic Consolidated Fund |
Emoluments / Pensions pf persons (1), (3), (4) and (5) |
1,65% |
4,70% |