In circular no. 12 of 26 January 2022, INPS explained the scope of application of Ministerial Decree 23 December 2021, which identified the contractual remuneration to be used for calculating contributions due for the compulsory insurance of Italian workers working abroad.
Scope of application
For social security purposes, contractual remuneration must be taken as a reference to calculate social security contributions due by workers operating in non-EU countries not linked to Italy by social security agreements. This remuneration applies to Italian and foreign workers, with a regular residence permit and an employment contract in Italy, who are sent by their Italian employer to a non-EU country.
Contractual remuneration is applied, residually, to workers sent to countries that have a social security agreement with Italy, only for insurance not included in applicable social security agreements.
Calculation and adjustment
INPS stated that “the contractual taxable remuneration for workers who belong to a pay range, is determined by comparing the corresponding national pay range”, as referred to in the tables for national collective labour agreements for the different categories.
To implement the provision on pay ranges, “national pay” means “the remuneration provided for the worker by the collective agreement, including the emoluments under an agreement between the parties, but excluding the foreign allowance.” The amount calculated must be divided by 12 and the pay range, taken as a reference for contribution obligations purposes, must be identified by comparing the calculation result with the tables of the corresponding sector.
The contractual values identified using the INPS calculation can be adjusted daily only for recruitment, employment termination or transfer during the month. In such cases, the monthly taxable amount must be divided by 26 days and, subsequently, the value obtained must be multiplied by the number of days included in the fraction of the month concerned, excluding Sundays.
Special cases and contribution regularisations
The remuneration determined according to the above criteria may vary if:
In these two cases,” INPS stated that “the contractual remuneration corresponding to the change with the same starting date of the new qualification or the change in individual remuneration must be applied.
A further case is when variable remuneration accrues during the year, due, for example, to overtime and bonuses. Since these amounts do not determine the applicable pay range, it is necessary to recalculate such remuneration, including the above remuneration items, and divide the value obtained by 12 months’ salary.
If, as a result of that recalculation, a monthly salary entails a change in the range to be taken as reference for the year for contribution calculation compared with the range adopted, it will be necessary to adjust the previous periods, as from January of the current year.
INPS concluded by requiring compliance for employers who, in January 2022, acted contrary to the circular instructions. To comply, the employers involved have until the 16th day of the third month following the publication of the circular, i.e. until 16 April 2022.