Effective from the 1st of January 2018, the social contribution tax will continue to decrease by 2,5 percent and the minimum / guaranteed minimum wage will increase. In this post, we look at how much entrepreneurs will have to pay.

 

We know that individual and corporate entrepreneurs have to pay social contribution for at least 112.5 percent of the minimum / guaranteed minimum wage.

In 2017 with 22 percent the social contribution is calculated as follows:

  1.  Calculating with the minimum wage, what is 127 500 forints:
    (127.500 x 1,125 = 143.438 Ft x 0,22 ) the monthly social contribution is 31.556 forints
  2. Calculating with the guaranteed minimum wage, what is 161.000 forints:
    (161.000 x 1,125 = 181.125 Ft x 0,22) the monthly social contribution is 39.848 forints.

 

In 2018 with 19,5 percent the social contribution is calculated as follows:

  1. Calculating with the minimum wage, what will be137 700 forints:
    (137.700 x 1,125 = 154.913 Ft x 0,195 ) the monthly social contribution is 30.208 forints
  2. Calculating with the guaranteed minimum wage, what is 180.320 forints:
    (180.320 x 1,125 = 202.860 Ft x 0,22) the monthly social contribution is 39.558 forints.

 

We can se that a 4.6 percent average wage increase is able to compensate for the impact of the 2.5 percent contribution cut planned for 2018, so entrepreneurs’ payable will stay close to the same level as in 2017.