Pripravovane zmeny odvodu pojistneho u DPP a prijmu z akcii a opci

Forthcoming changes to insurance premiums for work performance agreements and income from employee shares and stock option plans

Draft amendments to the Social Security and Health Insurance Acts have been sent for external comment. The changes mainly concern the regulation of the social security and health insurance contributions from income under the work performance agreement arrangement and income from employee share and stock option plans.

Changes to work performance agreements (DPP)

As we have already informed you (HERE), the approved consolidation package tightens the rules for the exemption from insurance premiums for DPPs from 1 July 2024. The exemption limit should vary depending on whether the employee has a DPP with one or more employers at the same time.

The proposed amendment abolishes the distinction according to the number of employers and instead introduces a so-called notified arrangement scheme, which an employee can have with only one employer. The relevant register will be kept by the Czech Social Security Administration on the basis of a notification submitted by the employer. Insurance premiums would then be paid only if the income of an employee from all the DPPs concluded with that employer in a given month amounts to at least 25 % of the average wage (i.e. CZK 10 500 in 2024).

Insurance premiums for other, i.e. unnotified, agreements would be treated as general employment - i.e. either as small-scale employment where the agreed income is less than CZK 4 000 per month and no insurance premiums are paid, or as standard employment with participation in insurance and payment of insurance premiums.

Employee shares/stock options

The amendment also aligns the time of payment of social security and health insurance contributions for income in the form of employee stock options and shares with the payment of income tax. As we have already informed you (HERE), from the new year, the taxation of employee stock options and shares will be postponed, in some cases for up to 10 years.

The proposed amendment would similarly defer the payment of social security and health insurance premiums from 1 July 2024. However, any adjustment of the tax base if the market value of a share falls should not be taken into account for the payment of insurance premiums.

The proposed amendment raises many practical questions. We will keep you informed of further developments.

If you have any questions, please contact the authors of this article or the EY tax team with whom you regularly work.

Authors:

Radka Růžičková

Ondřej Polívka