The National Office of Social Insurance has provided some clarifications regarding the introduction of the tax regime for self-employed entrepreneurs, in particular regarding social security entitlements and the situations in which these may be recalculated.
Social security contributions for independent entrepreneurs are included in the single tax and are recorded by the National Office of Social Insurance based on information provided by the State Tax Service, and are subsequently recorded in the personal social security account of each independent entrepreneur.
Right to social insurance benefits
Self-employed entrepreneurs who pay the single tax are entitled, under the conditions of the legislation in force, to all types of state social insurance benefits, including:
· pensions;
· temporary incapacity for work indemnities;
· maternity indemnities;
· paternity indemnities;
· childcare benefits until the child reaches the age of 3;
· unemployment benefits;
· death benefits.
Entitlement to benefits is determined on the basis of the social insurance contributions calculated and actually paid.
Recalculation of contributions and impact on benefits
According to Article 69²⁴(2) of the Tax Code, in the event of a refund or reimbursement of the value of services rendered or the granting of discounts, the income obtained is reduced in the month in which the refund, reimbursement or discount was granted.
Consequently, the single tax and the social insurance contributions included therein may be recalculated, which may affect the previously established social insurance benefit entitlements.
Recovery of unduly paid benefits
If, as a result of the recalculation of contributions, it is found that social insurance benefits have been determined or paid in an amount greater than that due, self-employed entrepreneurs are required to refund the amounts unduly paid.
Recommendation
To avoid recalculation and possible obligations to repay benefits, self-employed entrepreneurs are advised to:
· take into account that a decrease in income affects the amount of state social insurance contributions, which are part of the single tax;
· be aware of the impact of reductions or refunds on their entitlement to benefits.