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This reduction of employer contributions for start-ups and small employers will take on a new form as of 2022, including for ongoing reductions.
An overall evaluation of this measure led to new regulations, included in the Programme Act of 27 December 2021 and the Royal Decree of 27 January 2022.
A first adjustment was already known: the reduction for the very first hiring henceforth is limited to a quarterly lump sum of € 4,000.00. We informed you about this in our Infoflash of 30 November 2021
In addition, the "technical" framework for the qualification for and application of the1st to 6th reduction ranking is thoroughly reformed, making the implementation more coherent but at the same time more rigorous.
In general, it becomes more difficult to qualify for the reduction and, once qualified, to effectively apply it.
All new rules will apply as of 1 January 2022:
Reductions for which the employer qualified prior to 2022 (by a hiring no later than 31 December 2021) remain active and are applied for the remaining quarters, even if the hiring would no longer be compliant under the new rules.
First hiring: limitation as of 2022
Until the fourth quarter of 2021, the reduction first hiring was the full exemption from basic contributions (25% in the profit sector).
From the first quarter of 2022 onwards, the reduction will be limited to the quarterly lump sum of €4,000.00 for a full-time worker having worked the full reference period, even if the employer qualified for the reduction for a (first) hiring prior to 2022.
The reduction remains unlimited in duration, the number of application quarters is not limited.
Refer to our Infoflash of 30 November 2021
For these rankings, there are no changes in 2022: the quarterly lump sum and the number of application quarters remain the same.
Reduction ranking
Reduction
basic amount
first hiring
€ 4,000.00
every employment quarter
full duration of employment of staff (unlimited in time)
second hiring
€ 1,550.00
5 quarters
20 quarters as of quarter second hiring
€ 1,050.00
€ 450.00
third hiring
9 quarters
20 quarters as of quarter third hiring
fourth hiring
20 quarters as of quarter fourth hiring
fifth hiring
20 quarters as of quarter fifth hiring
sixth hiring
20 quarters as of quarter sixth hiring
The conditions become stricter as of 2022.
Henceforth, the 1st to 6th reduction ranking can take effect upon a hiring that meets two conditions:
In the reference period of 12 months preceding the hiring, no more than n-1 workers may have been employed in the company at the same time, in order to qualify for the n-th reduction ranking (until 31.12.2021, the reference period was the four calendar quarters preceding the quarter of hiring).
Henceforth, the reference period will run over 12 months from day to day – i.e. as follows:
If no workers were employed during the reference period, the employer may qualify for the reduction 1st hiring. If at most 1, 2, 3, 4, 5 workers were employed at the same time, the employer may qualify for the reduction for the 2nd,3rd,4th,5th, 6th hiring respectively. As soon as 6 workers were employed at the same time, the employer does no longer qualify for the reduction for a new hiring.
On the hiring date, at least the number of workers corresponding to the reduction ranking for which the employer qualifies must be employed at the same time in the company (until 31.12.2021 this was not required),.
For the first hiring, this condition is obvious.
As of the 2nd hiring, at least 2, 3, 4, 5, 6 workers must be employed at the same time on the hiring date to qualify for the 2nd, 3rd,4th,5th, 6th reduction ranking respectively.
Maximum number of workers employed at the same time in the reference period of 12 months prior to the hiring date
Minimum number of workers employed in the company on the hiring date
→ to qualify for the reduction ranking
0
1
1st
2
2nd
3
3rd
4
4th
5
5th
6
6th
Hiring on 15 March 2022.
The reference period runs from 15 March 2021 to 14 March 2022. During this period, it is necessary to evaluate, day by day, how many workers were employed at the same time. The day with the highest number determines for which ranking the employer qualifies by the hiring concerned.
Suppose that in the reference period at most 3 workers were employed at the same time, then the employer may qualify for the 4th ranking provided that at least 4 workers are employed in the company on 15 March 2022 (hiring date).
Once an employer is qualified for a ranking, entitlement to a number of application quarters is created and the question arises: when can the corresponding reduction be effectively applied in a given quarter?
Here too, the conditions are stricter from 2022 onwards.
In the quarter, at least the number of workers corresponding to the ranking applied must be employed at the same time – the simultaneous employment does not have to cover the entire quarter (until 31.12.2021, it was sufficient that at least the number of workers corresponding to the ranking were employed in the course of the quarter, it did not have to be at the same time).
Minimum number of workers employed at the same time in the quarter
→ for the application of a reduction ranking (for which the employer qualifies) in that quarter
The following persons:
1) Persons not subject to social security (e.g., students with solidarity contributions)
2) Next subject categories: domestic servants, apprentices, persons subject to compulsory part-time education, occasional workers in agriculture and horticulture, occasional workers in the hospitality sector, flexi-job workers (until 31 December 2021, occasional workers in the hospitality sector and flexi-jobs could lead to qualification for a ranking and were included in all calculations).
A reduction ranking, if applicable in a quarter, can be optimized over the workers employed in that quarter:
When the company (as a legal entity) for which the 1st ... to 6th reduction have taken effect ceases to exist, the remainder of the current reductions is, in principle, lost.
However, the "new" company which continues the activities of the "former" company after a reorganisation can apply the remaining quarters provided a number of conditions are met. The regulations refer to a series of situations included in the Companies and Associations Code - broadly speaking, these are situations of merger, demerger, transformation, acquisition.
From 2022 onwards, it is sufficient for the reorganisation of affected companies to be in line with articles 12:2 to 12:10 and 12:103 of the Companies and Associations Code, without necessarily having to comply with the formal conditions imposed by this Code. It must, however, always be an economic reorganisation.
There are the following formal conditions:
As before, the company that continues the reduction is jointly and severally liable for all known and unknown social security debts of the "former" employer at the time of the continuation. This liability must be explicitly acknowledged in the model declaration to be submitted to the NSSO.
From 2022 onwards, double use of the reduction will be prohibited, due to the new principle that within the same company, the same ranking can only be applied once over a (total or partial) period of overlap. Until the end of 2021, the acquiring company could continue a reduction ranking and also qualify for the reduction ranking itself through its own hirings.
From 2022 onwards, the application of the first hirings reduction within a group of employers (a so-called "technical business unit") becomes much more difficult, in many cases even impossible. This situation will be addressed in a separate Infoflash at a later date.
Sources:
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