To set restriction on income tax for supplementary insurance, use formula for calculating income tax relief. Therefore, the restrictions from Article 301 of the Pension and Disability Insurance Act can be represented as follows:

[#Del12#*0.05844>30000:#Del12#*0.05844] [#PRZnesek#>#Del12#*0.05844:#Del12#*0.05844] [#PRZnesek#>30000:30000] #PRZnesek#

The formula used to calculate income tax relief displays the amount you have to deduct from the premium of voluntary supplementary insurance so that you get the base for income tax.

The top amount of tax relief premium is (currently) determined with the absolute amount of 125.19 EUR or 24% of contributions for mandatory pension insurance (15.50% + 8.85). This is exactly 5.844% of employee's gross salary.

The order of supplied conditions is very important since in formulas you have to observe consecutive order. Thus they are as follows:

1. If 5.844% amount of gross salary exceeds the maximum amount of voluntary insurance (125.19 EUR), the percentage amount of gross salary is deducted from the salary. It holds good for employees whose gross salary exceeds 2142.16 EUR.
2. If premium of voluntary insurance exceeds 5.844% of gross salary amount, then just like above the 5.844% amount of gross salary is deducted from premium.
3. If the premium for supplementary voluntary insurance exceeds the maximum amount (125.19) and no requirements have been met, the amount of relief equals 125.19 EUR. That is, the maximum amount of 125.19 EUR is recorded as tax relief.
4. If no conditions are fulfilled, the total amount of premium is deducted to calculate exposure base. That is, the total amount of premium of voluntary supplementary pension insurance shall be considered as tax relief.

    

    

How to calculate data in section Basis V e?

Example:

The employee's gross salary is 417.29 EUR. The average salary of the current month is 765.11 EUR and the amount of general relief is 11% or 84.16 EUR. The employee is not entitled to any individual tax relief.

1. The employer pays 125.19 EUR for voluntary supplementary insurance.

    

Thus the income tax basis includes the following amount 125.19 EUR - 24.39 EUR = 100.80.

Section Basis V e shows income tax basis less the deductions which is obtained from voluntary supplementary insurance.

Income tax basis = (gross salary) 417.29 + (basis from supplementary insurance) 100.80 - (contributions 542.48 * 22,1%) 119.89 - (general relief) 84.16 = 314.04

Relative share of contributions: (119.89 + 84.16) / 518.09 = 0.39385

Income tax basis obtained from supplementary insurance (section Basis V e) = 100.80 - (0.39385 * 100.80) = 61.10

2. The employer pays 208.65 EUR for voluntary supplementary insurance.

    

Thus the income tax basis includes the following amount 208.65 EUR - 24.39 EUR = 184.26.

Section Basis V e shows income tax basis less the deductions which is obtained from voluntary supplementary insurance.

Income tax basis = (gross salary) 417.29 + (basis from supplementary insurance) 184.26 - (contributions 625.94 * 22,1%) 138.33 - (general relief) 84.16 = 379.06

Relative share of contributions: (138.33 + 84.16) / 601.55 = 0.369861

Income tax basis obtained from supplementary insurance (section Basis V e) = 184.26 - (0.369861 * 184.26) = 116.11

Income tax basis (section IV) = 601.55 - 138.33 - 84.16 = 379.06

Below you can see earnings type for voluntary supplementary insurance:

Set recipient's bank account in payroll preparation (see Individual Employee Information). That is why it is easiest to enter this earnings type using Copy Earnings to All and specify receipient of contributions.

Tracking payments of premium for voluntary supplementary pensions insurance in VSPI panel in Employee Files and having set program parameters accordingly, it automatically obtains percentage value and amount of premium. Plus, it automatically distributes amount of premium among the employee and employer and sets account where the premium is transferred.