The change effective 01/01/2018 to the calculation of contributions for voluntary statutory health insurance
has caused considerable attention. Going forward, additional health insurance contributions may be demanded retrospectively, which is why it is advisable to build up reserves in order to cope with these unforeseeable costs.
But who exactly is affected?
As the heading suggests, this primarily concerns self-employed individuals who are voluntarily insured under the statutory health insurance scheme (GKV).
The new rules do not apply to self-employed individuals who …
… are privately insured,
… pay the maximum contributions to health insurance, e.g. due to high profits, or
… are covered under family insurance due to low income.
So what exactly is changing?
In principle, the health insurance contribution for the self-employed is calculated on the basis of the contribution assessment ceiling
(Beitragsbemessungsgrenze, BMG) for 2018 in the amount of EUR 53,100 annually or EUR 4,425 monthly. If profits are lower, however, the actual profit serves as the BMG. Proof is provided by the income tax assessment notice. Nevertheless, even in cases of very low income, a minimum contribution for health and long-term care insurance of EUR 377.85 (excluding entitlement to sick pay and supplementary contribution) is levied, which can only be reduced further in cases of hardship. Until the end of 2017, GKV contributions were calculated on the basis of the income shown in the most recently issued income tax assessment notice, regardless of the assessment period to which it related. Only the issuance of a new income tax assessment notice led to an adjustment of contributions; a retroactive adjustment of contributions was only provided for in the case of business start-ups.
From 2018 onwards, this will change:
Health insurance contributions calculated on the basis of profits below the BMG will now only be set provisionally. Here too, contributions are based on the most recent income tax assessment notice. Only once the actual profit is known will the contributions be finalised. If the provisional contributions were initially too low, additional payments may now be required; conversely, refunds are also possible.
Proof must be provided!
The health insurance fund must be presented with the income tax assessment notice showing the income actually earned in the relevant calendar year within three years after the end of the calendar year concerned.
For the calendar year 2018, proof must therefore be provided by the end of 2021. Otherwise, there is a risk that contributions will be assessed on the basis of the BMG in the amount of EUR 53,100. As a rule, income tax assessment takes place about one to two years after the end of the assessment period. Accordingly, this means that contribution claims for
health insurance are only demanded around two years after the end of the relevant calendar year. To avoid payment shortfalls, it is therefore important to build up appropriate reserves in advance.
Conclusion
In principle, the change is to be welcomed, as contributions are now calculated on the basis of actual income rather than, as previously, on the basis of prior years. However, the new rules require considerable self-discipline from taxpayers with steadily rising profits, as the reserves to be built up should not be used for other purposes over an extended period.
For your questions, please feel free to contact:
ANKE BÜKER
Steuerberaterin (German Certified Tax Advisor), Partner
Specialist Advisor for Business Succession (DStV e.V.)
Steffen & Partner Steuerberatungsgesellschaft
T 02871 275750
E bueker@steffen-partner.de
Frequently asked questions
Frequently asked questions
Who is affected by the new contribution assessment for voluntary statutory health insurance (GKV) from 2018?
The change affects self-employed individuals who are voluntarily insured under the statutory health insurance (GKV) and whose contributions are based on profits below the contribution assessment ceiling. Not affected are privately insured persons, self-employed individuals already paying the maximum contribution, and self-employed persons covered under family insurance with low income.
How are voluntary statutory health insurance (GKV) contributions for self-employed persons calculated from 2018 onwards?
Contributions are initially set on a provisional basis using the most recent income tax assessment notice. Once the income tax assessment for the relevant contribution year is available, a final determination is made based on the actual profit. This may result in either additional payments or refunds.
What evidence must be provided to the statutory health insurance fund?
Self-employed persons must submit their income tax assessment (Einkommensteuerbescheid) for the relevant calendar year to their health insurance fund within three years after the end of that year. For 2018, the evidence must therefore be provided by the end of 2021. If the evidence is not submitted on time, contributions will be assessed based on the contribution assessment ceiling (Beitragsbemessungsgrenze; 2018: EUR 53,100).
What is the minimum contribution to voluntary health and long-term care insurance in 2018?
The minimum contribution to health and long-term care insurance in 2018 is EUR 377.85 per month, excluding sick pay entitlement and supplementary contribution. This minimum applies even at very low income levels and can only be reduced in cases of hardship.
Why should self-employed individuals build reserves for additional contribution claims?
Since the final contribution assessment is only made once the income tax notice is available, additional claims typically become due one to two years after the end of the contribution year. Rising profits can lead to substantial back payments. To avoid liquidity shortfalls, sufficient reserves should be built up early and not used for other purposes.