Starting Greek Professionals Will Have to Repay Discounted Security Contributions Retroactively

A circular of the new single security fund (EFKA) says that starting Greek professionals will pay discounted contributions for the first five years, but will have to repay them retroactively plus interest.

This comes after a promise by Prime Minister Alexis Tsipras that he would give incentives to young scientists, entrepreneurs and professionals to stop Greece’s brain drain.

The circular distributed concerns the method of calculating contributions for about 900,000 professionals, freelancers and self-employed, without further explaining many gray areas, something that adds more headaches to the already burdened taxpayers.

Security contributions have been set at 20% for pensions and another 6.95% for health care, plus a flat 10 euros per month for the unemployment agency (OAED). The minimum monthly contribution for all professionals is estimated at 167.95 euros (117.22 euros for pension, 40.73 for health care and 10 euros for OAED) and the highest contribution is 1,589.49 (1.172.16 euros for pension fund, 407.33 euros for health care and 10 euros for OAED).

Regarding young professionals who start their practice or business, they will have to pay contributions reduced by 14% in the first two years and by 3.17% for the next three, with a base of 410.26 euros of earnings per month.

However, it is specified that the discounts, both in percentage and in the basis for calculating contributions, will be considered insurance liabilities to be increased annually by the change in wages set by ELSTAT and they will have to be repaid within 15 years.

This means that the minimum contribution during the first two years of insurance will be 108.17 euros, while the annual debt is 717.36 euros. Similarly, the next three years the lowest contribution would rise to 120.47 euros, with the annual debt calculated at a minimum of 569.76 euros.