Being an employer

It is important to know that when you register as an enterprise, at the same time you must also be self-employed, to employ or to contract someone who will help in the development of your activity. In this case, an employer-employee relationship will arise under the terms stipulated by the Law no. 9136, dated 11.09.2003, "On the collection of mandatory social security contributions and health care in the Republic of Albania", as amended, and by the Labor Code. The employers through the labor contracts with the employees define the rights and obligations, as well as they pay for the work performed. On the basis of the employment contracts, the employer must ensure the employee's declaration, calculation, maintenance and payment to the tax authorities of the social security contributions and health care, as well as the tax on the salary.

Briefly on how to get oriented in relation to the obligation for social security contributions and health care contributions, etc.

The organ responsible for collecting the contributions is the tax administration, on behalf of the Social Security Institute and the "Fund of Mandatory Health Care Insurance".

A self-employed taxpayer is registered at the National Business Center and the tax authorities as a "natural person".

The Self-employed can exercise economic activity with these statuses:

1. Self-employed only;
2. Self-employed with employees;
3. Self-employed with employees and unpaid family workers;
4. Self-employed without employees with unpaid family workers;

The term "self-employed" does not include the person that is employed in agriculture. The self-employed person is responsible for the payment of contributions also for the unpaid family workers. The self-employed pensioners, who receive pension and exercise, single, professional economic activity, do not have the obligation to pay the social security contributions and health care.

The employer, as in the case of the self-employed and for all other undertakings, is responsible for withholding the employee’s contributions and payments to the tax authorities, together with the obligation of the employer for the contribution as follows:
Mandatory contributions to health care insurance - contributions that are paid pursuant to Article 5 of the Law no. 10 383, dated 24.2.2011, "On mandatory health care insurance in the Republic of Albania", as amended.

Mandatory contributions to social security - contributions that are paid pursuant to Articles 9 and 13 of the Law no. 7703, dated 11.5.1993, "On Social Insurance in the Republic of Albania", as amended.

Mandatory contributions to social security of the employer for the employee and the contributions of the employer himself, are calculated on the gross salary of the employee and other allowances of permanent character arising from the labor relations, within a minimum gross salary and the maximum salary for the purposes of calculating the social security.

The mandatory contributions to health care insurance of the employer for the employee and the contributions of the employer himself, are calculated according to the level specified on the gross salary of the employee and other allowances of permanent character arising from the labor relations, which cannot be lower than the minimum salary determined by the Council of Ministers.

The mandatory contributions to social security for the self-employed, including employer self-employed and unpaid family workers, are calculated according to the level envisaged as a percentage of the minimum salary approved for the purposes of calculating the social security contributions and health care, as defined by the Council of Ministers. The mandatory contributions to health care insurance for the self-employed person, including the employer self-employed and unpaid family worker, are calculated according to the level envisaged as a percentage over the double of the minimum salary approved for the purposes of calculating the social security contributions and health care.

The declarations and payment of contributions are made within the deadlines set by law.

When you act as an employer in relation to the employer-employee relationship, you pay the employee’s salaries, contributions and the liabilities according to the declarations which must be submitted periodically:

• you must declare any employee who starts work for the first time as recently employed at least 1 calendar day before starting the work.
• You must declare any person who leaves work in the tax authority within 10 calendar days from the date of removal. These declarations serve as the declarations for the State Labor Inspectorate, as defined in Article 22, paragraphs 4 and 5 of the Law no. 9634, dated 30.10.2006, "On the Labor Inspectorate", as amended, and are made available to the latter from the tax administration electronically.
• You must declare the payroll.

You must submit the periodically declarations as in the table below:

The declaration in this case shall include the persons, also the self-employed, the unpaid family workers, and employees.