Categories: Blog
On July 30, the Board of Directors of the Costa Rican Social Security Fund (CCSS) approved the Insurance for Micro-enterprises and Entrepreneurs, where this Social Security Benefit adjusted to wages seeks to combat informality.
What is the regulation about?
The new regulation gives temporary preferential conditions to SMEs, in search of a better development of their economic activity, to promote employment and the success rate of the entrepreneurial sector in Costa Rica.
What are the benefits?
The Costa Rican Social Security Fund created a formula for the tax base (the total amount on which the amount of a certain tax to be paid by a physical or legal person is calculated), which allows reducing the base on which employers’ and workers’ health insurance contribution is calculated, which will increase progressively for four years; until in the fifth year it reaches the percentage that all employers and their workers are quoted as shown in the following table:
| 1st. year | 2nd. year | 3rd. year | 4th. year | |
| Employer | 4.25% | 5.25% | 6.25% | 7.25% |
| Workers | 4.20% | 4.50% | 4.80% | 5.00% |
Who will this benefit?
Physical or legal SMEs or PYMPAS that develop a permanent activity, that are accredited in the Ministry of Economy, Industry and Commerce (MEIC) and in the Ministry of Agriculture and Livestock (MAG), which have between 1 and 5 workers, and are enrolled for the first time or have been inactive for the past 12 months will be considered.
What is the procedure?
SMEs, both in informal condition, and those that need to resume as employers before the Costa Rican Social Security Fund (CCSS), as well as those that are just going to start their activity or were inactive for the last 12 months, may calculate their employer’s contribution and that of workers to health insurance on a less than usual basis, which will gradually increase over a period of four years; on the fifth year they will have reached the percentage that all employers and workers are quoted. Which will govern as follows:
- Regarding the employers, in the first year the base will start at 4.25%; amount that will increase 1% every year until it reaches 7.25% in the fourth year. By the fifth year it will reach 9.25%, which is the general base.
- In the case of workers, the contribution percentage will begin at 4.20% and will grow gradually by 1.30% in the first three years, by the fourth year it will reach 5%. By the fifth year it will reach 5.25%, which is the general base.
How can I apply?
Those interested must submit the application to join the BAS scheme. This must be signed by the physical employer or the legal representative, in the case of legal persons. The application must be submitted to the CCSS Inspection Service at the time of registration or resume.
Other requirements
- That, at the time of registration or resumption of employers, the SME’s have a maximum of five workers.
- To not have outstanding debts with the Costa Rican Social Security Fund (CCSS), nor derived from the Worker Protection Law, or contributions to the Social Development and Family Allowances Fund (FODESAF) as employer, or as an independent worker.
- To not have accredited investigation processes for breaches in assurance matter, by the Inspection service of the CCSS.
- Address a bank account registered in your name, so that the CCSS can collect social charges automatically and securely.
- Have the microenterprise status certified by the Ministry of Economy, Industry and Commerce (MEIC) or the Ministry of Agriculture and Livestock (MAG).
This is how microentrepreneurs, through thisRegulation of the Benefit in Social Security, can take the first step to formalize their operation, opting for this modality at the time of registration in the Fund, which will allow them to pay a salary adjusted basis during the first four years of life of the entrepreneurship with a reduced and progressive rate.
At ERP Lawyers we have a team of professionals in labor law willing to provide the advice and support required to your company, both employers and their workers, in relation Benefit in Social Security Adjusted Salary and other issues related to labor interest.
Contact us today to receive ethical and responsible advice on labor law.
