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How are salaries and social insurance contributions calculated?
How are salaries and social insurance contributions calculated?
In relation to the income tax paid on the income derived from salaried employment, we would like to inform you that, based on the amendments made to the legislation as of January 1, 2019, for individuals who are not engaged in the oil and gas sector and work in the non-governmental sector, if their monthly income from salaried work is up to 8000 manat, the tax rate is 0%. If the income exceeds 8000 manat, the tax on the amount exceeding 8000 manat is calculated at a rate of 14%.
If the individual's monthly income subject to social insurance contributions is 200 manat or less, a 3% social insurance contribution is deducted from the amount. If the income exceeds 200 manat, a fixed amount of 6 manat is deducted, plus 10% of the amount exceeding 200 manat. On the employer's side, the social insurance contribution for the employee is calculated at a rate of 22% on the portion of the monthly income up to 200 manat, and 15% on the portion exceeding 200 manat.
Additionally, for unemployment insurance, the employer (the insurer) pays 0.5% of the calculated labor compensation fund, and the insured (employee) pays 0.5% of their salary as unemployment insurance.
It is also established that for compulsory health insurance, 2% is deducted from the part of the employee's salary up to 8000 manat, and 0.5% from the portion exceeding 8000 manat.
In relation to the income tax paid on the income derived from salaried employment, we would like to inform you that, based on the amendments made to the legislation as of January 1, 2019, for individuals who are not engaged in the oil and gas sector and work in the non-governmental sector, if their monthly income from salaried work is up to 8000 manat, the tax rate is 0%. If the income exceeds 8000 manat, the tax on the amount exceeding 8000 manat is calculated at a rate of 14%.
If the individual's monthly income subject to social insurance contributions is 200 manat or less, a 3% social insurance contribution is deducted from the amount. If the income exceeds 200 manat, a fixed amount of 6 manat is deducted, plus 10% of the amount exceeding 200 manat. On the employer's side, the social insurance contribution for the employee is calculated at a rate of 22% on the portion of the monthly income up to 200 manat, and 15% on the portion exceeding 200 manat.
Additionally, for unemployment insurance, the employer (the insurer) pays 0.5% of the calculated labor compensation fund, and the insured (employee) pays 0.5% of their salary as unemployment insurance.
It is also established that for compulsory health insurance, 2% is deducted from the part of the employee's salary up to 8000 manat, and 0.5% from the portion exceeding 8000 manat.