On the evening of 25 March, the government presented a proposal to temporarily reduce the social charges on payments made during the period 1 March to 30 June 2020. The government has not released any details regarding how the reduction will be practically accounted for or reported.
Employers will, according to the proposal, only need to pay the old-age pension contribution on their employees' salaries for the months of March, April, May, and June. The old-age pension contribution is 10.21 % for 2020.
Limitations
The reduction only applies to employer contributions on salaries up to SEK 25,000.
- On the excess amount (over SEK 25,000) % an employer's fee of 31.42% shall continue to be paid.
The employer can receive reduced employer contributions for a maximum of 30 people.
- If you have more than 30 employees, you will only be eligible for a reduction for 30 people, as we currently understand the proposal.
The proposal is set to take effect on 6 April, meaning employers will see a reduced cost of SEK 5,300 per employee for up to 30 employees. This could result in a cost reduction and increased liquidity for employers of up to SEK 159,000 per month. The first payment that will be affected, should the proposal be approved, is the one due on 14 April, relating to remuneration paid in March.
For sole traders, the proposal means that only the contribution for the old-age pension contribution, two-thirds of the other self-employment contributions, and the general payroll tax shall be paid during 2020. According to the government, this shall be a corresponding reduction.
According to the information currently available, the money will not be repaid later, but is direct support. It is considered very likely that the proposal will pass in the Riksdag.
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If you need help accessing any of the government's support packages, please contact your MOOREÂ contact person or get in touch with your local MOORE office.
