Current information on deferral of social security contributions
Employers who have been affected by business restrictions or closures due to the Austrian government directive, Austrian Federal Law Gazette (BGBl) II 2020/96, or a ban on access under the Austrian Epidemics Act (BGBl II 2020/74), have benefited since March 2020 from an automatic, interest-free deferral of payment of social security contributions for the contribution periods February, March and April 2020 until 31 May 2020. Employers who have not been affected by restrictions of this kind, but who were unable to make such contributions due to liquidity problems arising due to COVID-19, have been granted deferral of payment on application.
In the context of a second package regarding deferrals, further measures were planned in late May to support employers in this regard. However, the legislative process has been delayed because the matter has not been dealt with by the Federal Council (upper house of the Austrian Parliament). Publication of the Act is planned for the end of July. It is planned to enter into force retrospectively, effective from 1 June 2020.
The uncertainty arising from this delay has been mitigated at short notice by an Ordinance of the Federal Minister for Social Affairs, Health and Consumer Protection (BGBl II 2020/261). This stipulates that any overdue contributions will not be collected until 31 August 2020 and it will continue to be the case that no surcharges for late payment will be imposed. The same applies for late notifications (with the exception of late registrations). The Austrian Health Fund (ÖGK) has requested that no applications for deferral are made at present – a corresponding form will be made available at the beginning of August 2020.
The second package on deferrals envisages the following measures:
Contribution periods: February, March, April 2020
The contributions for the periods February, March and April 2020 deferred until 31 May 2020 must be paid by 15 January 2021 at the latest. Late payment interest continues not to apply. According to the ÖGK, the employer does not need to make a separate application in this regard.
If the contributions still cannot be paid by January 2021 due to liquidity shortfalls as a result of COVID-19, it will be possible to pay in instalments without late payment interest being charged. The contributions for the contribution periods February, March and April 2020 must then be paid in eleven equal instalments from February 2021. An application for payment in instalments can be made from January 2021 and must include a credible explanation of the liquidity problems due to COVID-19.
Contribution periods: May to December 2020
Social security contributions for the contribution periods May to December 2020 can be delayed for up to three months. Subsequently, an application can be submitted for payment of the contributions in instalments (including late payment interest) until December 2021 at the latest. In the application, a credible explanation must be provided for the liquidity shortfalls due to COVID-19.
Exceptions for short-time working and COVID-19 ‘at risk’ groups
An exception applies for contributions for which financial support from the Austrian federal government or the Austrian Public Employment Service (AMS) has been used due to short-time working or leave granted on the basis of a medical assessment as belonging to a COVID-19 ‘at risk’ group. These contributions are not covered by the deferral privileges and must be made by the fifteenth of the second month after the subsidy, refund or remuneration payment.
PwC is available to provide support on applications for deferral or payment in instalments.
