• 30/06/2022
• By wizewebsite
• 497 Views

The minimum wage will rise to 15,200 crowns.What growth affects and who earns<

In most developed countries of the world, the minimum wage regularly increases every year depending on economic development.The Czechia is one of the countries where the minimum wage has grown most in recent years.

Since 2015, when it amounted to CZK 9,200, it has increased annually.Between 2015 and 2021, the price of cheap labor increased by CZK 6,000.However, the growth of the minimum wage is significantly increased by employers for auxiliary work.

"By increasing the minimum wage by CZK 600, wage costs increase by CZK 803, as employers pay for employees beyond gross wages and compulsory social and health insurance in a total amount of 33.8 %," adds Gabriela Ivanco, tax advisor to Mazars.

Health insurance companies get better

The annual increase in the minimum wage is always a positive news for health insurance companies.Health insurance for employees who are not at the same time by state insured persons (such as pensioners or students) must always be paid at least from the minimum wage.In 2021, therefore, at least CZK 2,052 (15 200 CZK by 13.5 %), while employers pay 9 % for employees and employees of 4.5 % of gross wage.

What still affects the minimum wage

Employees working for part -time, for which the state does not pay at the same time, with a gross monthly wage less than CZK 15,200 will pay more for health insurance, as the calculation up to CZK 2,052 will go to their notes.

"The health insurance paid by an employee working part -time with a gross wage of CZK 13,600 is 747 crowns this year, in 2021 it will be 828 crowns, the employer will continue to pay CZK 1,224," Ivanco calculates.

Increasing contributions to health insurance companies, however, are not just about those who work for a minimum wage.It also applies to people who do not have taxable income and pay for their contributions from their regular monthly payments.

“For example, the unemployed citizens not registered at the Labor Office or students over 26 years of age are persons without taxable income (OBZP).At the same time, the monthly payment is obliged to pay until the 8th day of the following month, ”explains Ivanco.

The amount of health insurance is equally high for all without taxable income, regardless of the family or life situation and is 13.5 % of the minimum wage.

"In 2021, persons without taxable income will have to pay monthly health insurance in the amount of CZK 2,052, while this year it was CZK 1,971," adds the tax advisor.

Parents who want to draw a tax bonus will have to show higher income.For the possibility of drawing a tax bonus it is necessary to have annual active income at least six times the minimum wage.While for 2020 it is necessary to have income in the amount of 87 600 crowns (14 600 by 6 = 87 600 CZK), in 2021 already in the amount of CZK 91,200 (15 200 by 6 = 91 200).

The entitlement to the tax bonus arises if the tax advantage to children is higher than the calculated personal income tax."Only one of the parents can apply a tax advantage to children, so it is advisable to calculate which of them in full use of tax benefits," Ivanco points out.

Together with the increase in the minimum wage, the keeper will increase, ie the maximum possible discount for the placement of the child in the pre -school facility.While this year this discount amounted to 14 600 crowns, in 2021 it will rise to 15,200 crowns per year per child.

Pensioners also earn minimum wage growth.The minimum wage also affects the amount in which the tax -exempted pensions are exempted.

"In the 2020 tax return, pensions are exempted up to CZK 525,600, while in 2021 regularly paid pensions up to CZK 547,200, which corresponds to a monthly pension of CZK 45,600," concludes Gabriela Ivanco of Mazars.Pensioners will only have the tax concerns with retirement tax only sporadically.

The existing minimum wage of CZK 14,600 is the result of a compromise: