Maximum Calculation Base
Maximum Calculation Base for Employees
There is a new maximum calculation base for payment of social security premium and contribution to the state employment policy (hereinafter just Insurance Premium), defined as 48 multiple of the mean annual wage. The maximum calculation base for the purpose of insurance premium calculation amounts to CZK 1 569 552.
The procedure in the case of reaching the maximum calculation base then depends on the number of employers of the respective employee.
If in a calendar year the sum of the calculation bases of an employee exceeds the maximum calculation base and the employee only had one employer in the calendar year in question then the employee shall not pay for that year the premium from the amount in excess to the maximum calculation base; this also applies to more employments in the given calendar year with the same employer. The calculation base for the employer shooud not then include the amount in excess of the maximum calculation base of the employee from which the employe does not pay premium in the given calendar year. That means that the employer does not pay premium for the employee from the excess amount from which the employee itself does not pay premium (6,5 % of the calculation base), and does not even pay premium for itself from the same excess amount (25 % of the calculation base).
If in a calendar year the sum of the calculation bases of an employee exceeds the maximum calculation base and the employee was employed with more employers that calendar year, then the premium paid by the employee from the sum of his or her calculation bases in all jobs in excess to the maximum calculation base is considered overpayment by the employee; this overpayment, however, cannot be higher than the amount deducted from the employee's income as insurance premium. In such case the employee shall submit a written request for return of the overpayment supported with confirmations from all his or her employers about the calculation base achieved by the employee with them in the given calendar year for which the premium was deducted from the employee's salary. The affected employers, however, shall not be returned the premium paid for themselves (25 % of the calculation base).
Maximum Calculation Base of Self-Employed and Employee at the Same Time
The maximum calculation base of the self-employed for the purpose of premium payment 48 multiple of the mean wage.
The maximum calculation base shall also apply in cases when the insured performed work as self-employed and employee concurrently in the course of the calendar year in question. The calculation base of such an insured shall be reduced by the amount of excess of the maximum calculation base calculated as the sum of calculation bases for all his or her employments including the self-employment. The reduction shall first be applied to the calculation base of the person's work as self-employed. If the self-employed person has reached the maximum calculation base in his or her job with an employer then the person shall not pay premium from its activity as self-employed but the pension insurance shall also extend to this activity. The self-employed shall not be liable to pay the advance premium since the calendar month in which he or she has notified the SSA about reaching the maximum calculation base in the employment with the appropriate documentation. The fact whether the self-employed has reached the maximum calculation base in a single job or in more jobs for different employers does not matter for this purpose.