According to the Cyprus Social Insurance Law of 2010 (59(I)/2010), in January 2024, it is the fourth consecutive increase in the contributions of employers and employees to the Social Insurance Fund (SIF), following the provisions of this law for increases every five years until 2039, ensuring the sustainability of the fund until 2080.
From 01/01/2024, the contributions for both employer and employee to the Cyprus SIF increase by 0.6%, after an amendment to the relevant legislation in 2019 (which provided for an increase of 0.5%), i.e. from 8.3% which currently applies, to 8.9% of the employee’s insurable earnings.
In the same period, the state’s contribution to SIF increases, as well as the contributions of the self-employed. In more detail, the percentages will vary as follows:
Employees:
▪ 23.1%, of which 8.9% is paid by the employee, 8.9% by the employer and 5.3% by the Fixed Fund of the Republic.
Self-employed:
▪ 22.1%, of which 16.8% is paid by him and 5.3% by the Fixed Fund of the Republic.
Optional domestic insured:
▪ 20%, of which 15.2% is paid by the insured himself and 4.8% by the Fixed Fund of the Republic.
Optionally insured abroad:
▪ 23.1%, of which 17.8% is paid by the insured himself and 5.3% by the Fixed Fund of the Republic
Employees covered by an occupational pension scheme without contributing to it themselves:
▪ 23.1%, of which 4.55% is paid by the employee, 13.25% by the employer and 5.3% by the Fixed Fund of the Republic.
These increases will result in small reductions in employee’s wages and ultimately affect business costs, exacerbating the already existing situation with continued increases in inflation.
Should you need further information, do not hesitate to contact Eurofast office in Cyprus at nicosia@eurofast.eu
Yianna Papademetriou
Payroll Specialist
Nicosia, Cyprus