• If you want to employ a worker, you must submit a 1-SD notice of the beginning of state social insurance to “Sodra”, notifying it of a newly recruited employee no later than the day before the employee starts work. The notification must be submitted no later than one business day before the employee starts working (the form must be submitted online).
  • This notice informs “Sodra” about the employment contract concluded and the start of your new employee's social insurance in your company.
  • When submitting a notice, your company will incur an obligation to pay the state social and compulsory health insurance (VSD and PSD) contributions for its newly recruited employee.

 

  An employed person is compulsorily insured by all types of state social insurance (pensions, sickness, maternity, unemployment, accidents at work and occupational diseases) as well as by compulsory health insurance.

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When you employ a person or multiple persons, you must submit SAM notifications to “Sodra” on a monthly basis, before the 15th day of the month. You should provide “Sodra” with a notice on salaries and state social insurance contributions calculated for employees every month. The notice for the current month is due by the 15th day of the next month.

 

With this notification, you are informing “Sodra” about your employees' monthly salaries and calculated state social insurance contributions for each month.

The policyholder has to sign all of his provided notifications (messages) in the Personal “Sodra” account with a qualified electronic signature.

  The SAM notification for the current month is due by the 15th day of the next month.

  For example, you must submit a SAM notification by 15 February 2019 for the month of January 2019.

  If the 15th day of the month is a rest day or a holiday, the notification may be submitted by the end of the next business day.

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Employing a person

When providing data regarding the employment of a person according to an employment contract, the policyholder will have to specify the type of the employment contract according to a classification (1-SD notification regarding the start of state social insurance, fields A7, A8, A40 and A41):

01 – permanent employment contract;

02 - fixed-term employment contract;

03 - temporary employment contract:

031 - temporary employment contract;

032 - temporary employment contract of indefinite duration;

04 - apprenticeship contract;

05 - project work contract;

06 – workplace sharing employment contract:

061 - fixed-term workplace sharing employment contract;

062 - workplace sharing employment contract of indefinite duration;

07 - employment contract with several employers:

071 - fixed-term employment contract with several employers;

072 - employment contract with several employers of indefinite duration;

08 – Fixed-term seasonal employment contract:

081 - fixed-term seasonal employment contract;

082 - seasonal employment contract of indefinite duration.

 

This information is necessary to provide in view of the division of unemployment social security contributions for employees:

  • employed according to employment contracts from 1 January 2019, applied rate is 1.31 percent;
  • employed according to fixed-term employment contracts from 1 January 2019, applied rate is 2.03 percent.

 

  From 01-01-2019, the increased unemployment insurance premium rate (2,03%) applies only to employment contracts, provided for by clause 2 of part 1 of the Labor Code.

 

Providing data on the insured person’s work for several employers

If an employment contract is concluded with an insured person, which includes working for several employers, the first employer who will execute all of the employer’s functions, related to the planning of the working schedule, state social contribution calculation for this employee and provision of information regarding such an employee - must submit information to “Sodra”. This employer will have to pay all state social insurance contributions.

 

If an employee has worked (executed the same job functions) with several employers (i.e. two or more contracts of employment with different policyholders for the same job functions were concluded) before the new Labor Code has entered legal force, but from 1 January 2017, the employee and the employers agree to continue their relationships according to an employment contract for several employers, the policyholders, taking part in these working relationships, with the exception of the first employer, specified in the employment contract for several employers, submit 2-SD notices about the end of the insured person’s state social insurance to “Sodra”, indicating the following reason for providing the notification - the change of the type of employment contract (reason code - 96). In this case, starting from 1 January 2017, the functions and duties of the employer to pay the state social insurance contributions and the provision of SD notices and / or other data for the persons who work under the contract of employment for several employers pass to the first employer.

 

Information regarding the number of insured person’s agreements, concluded with the employer

Starting from 1 July 2017, an employee may only have one contract with the same employer, that is, a number of employment contracts concluded by the same employer with the same employee remain valid for the purpose of establishing the main contract of employment and agreeing on additional work functions. In this case, if the main contract is indefinite, there is no need to provide additional data to “Sodra”.

 

If the employer and the employee agree that the main work is of a fixed duration, “Sodra” must be provided with:

  1. A 2-SD notification, indicating the end of the insurance on 30 June 2017 and the reason code 96 "Change in the type of employment contract".
  2. A 1-SD notification, indicating the beginning of the insurance on 1 July 2017 and the reason code 96 "Change of type of employment contract". Please note that the contribution rate must be indicated when assessing the rate of unemployment insurance contributions for fixed-term employment contracts.
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In the event that the insured's salary is lower than the approved minimum monthly salary, the employer must calculate and pay not only the policyholder's but also the insured's social security contributions from at least the minimum monthly salary in order to reach the contribution "floor".

Exceptions to the lower limit of social insurance contributions apply, if in each month:

  1. The employee is already working for another employer or is insured by social pensions insurance from state funds (the employee brings up a child up to three years old, cares for an incapacitated person at home, serves in the army under the mandatory call program, is a priest and a monk, as well as is an artist of working age (part 2, 3, 4, 6, 7 of article 6 of the Law on SSI).
  2. The employee receives an old-age or disability pension, a disability or an old-age benefit, related to social insurance from another EU member state, from the EEA country, from the Swiss Confederation or from the country, Lithuania concluded an international agreement on the implementation of social protection with.
  3. The person is younger than 24 years old (applies up to a calendar month, the person turns 24 years old in).
  4. The incapacity rate of a person is 0-55%.
  5. The person received maternity, paternity or child care benefits.

  For example, if the calculated salary of your employee is 100 euros per month, you, as the employer, will have to pay contributions not from this sum of money, but from 607 euros (MMW). In this case, payments to the insurer (the employer) and the insured person (the employee) from 507 euros must be paid at the expense of the insurer; payments from 100 euros are made in the usual manner (at the expense of the insurer and the insured person).

From July 1, 2019, from the amount, which is not less than MMW, the insurer must pay not only a part of the insurer's payments; of the amount, which is not less than MMW, it is also necessary to make payments of the insured person (in this case, at the insurer's expense, only from the difference between the MMW and the actual calculated salary).

  From 01-01-2019, the “ceiling” of SSI contributions comes into force. This “ceiling” is the salary limit, payments to “Sodra” will not be counted from. In 2020, it will be applied to the income, exceeding 84 average wages (AW) per year. In 2021, the application limit will decrease to 60 AW per year.

The “ceiling” of payments does not apply to CHI contributions.

“Sodra” receives a monthly notice with employee salaries and state social insurance contributions. The notice for the current month is provided until the 15th day of the next month.

“Sodra” may also receive a 2-SD notice (on the termination of state social insurance) with the information about the fired employee. The notice should be submitted no later than the next business day after termination of the employment contract with an employee. “Sodra” must receive the contributions, specified in the notice.

Calculated contributions for the current month must be paid to the  “Sodra” account before the 15th day of the next month.

  For example, if you provide a notice for May 2019 on June 14, 2020, you will need to pay “Sodra” by June 15, 2020.

The payment rate also depends on the group of social insurance benefit on accidents with insurers and occupational diseases your company belongs to. There are 4 groups of insurers. They are related to the number of accidents at work and occupational diseases. As a rule, a company is assigned to group I, the rate of social insurance benefits on accidents at work and occupational diseases, equal to 0.14%, applies in.

Rates of social security contributions for accidents and occupational diseases from 01/01/2020:

  • I group – 0,14 %.
  • II group  – 0,4 %.
  • III group  – 0,7 %.
  • IV group  – 1,4 %.

Each year, insurers are distributed among these groups by the “Sodra” council (by the council decision), guided by the law, confirming the budget indicators of the State Social Insurance Fund of the Republic of Lithuania for that year, and the methodology approved by the order of the Minister of Social Security and Labor of the Republic of Lithuania. If you are not in the II-IV groups of insurers, you belong to the group I.

  The insurers, which start working in 2020, are assigned to group I. They are subject to the rate of social insurance benefits on accidents at work and occupational diseases, equal to 0,14%.

You can find out what rate applies to you by logging into the “Sodra” personal account for insurers, clicking on “Suvestinės” and generating a report - “Aktuali informacija draudėjams”.

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You must transfer the contributions to one of the “Sodra” payment collection accounts.

 

The payment information must contain the payment code:

  1. When you pay for your employees, the payment code is - 252.
  2. If you pay interest for late payments, the deposit code will be - 253.
  3. If you pay penalties for unlawfully reduced contributions, the code is - 254.
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The contributions paid to “Sodra” are intended to insure your employee with various types of social insurance. In this case, when your employees work under an employment contract, they are compulsorily insured with all types of social insurance (pensions, sickness and maternity, unemployment, occupational accidents and occupational diseases) and compulsory health insurance.

 

The contributions paid by you according to the rates approved by law are allocated to the respective types of social insurance. These rates are:

  • Unemployment social insurance - 1.31%. or 2.03%, if the employee is employed according to a fixed-term contract.

 

Your company also belongs to a group of policyholder’s social insurance contribution rates for accidents and occupational diseases. There are 4 of them in total, and different rates of social insurance for accidents and occupational diseases apply to each.

Rates applicable from 01-01-2020:

  • Group I - 0.14%.
  • Group II - 0.4%.
  • Group III - 0.7%.
  • Group IV - 1.4%.

 

Policyholders are allocated to these groups on an annual basis by the “Sodra” council, following the Law on the Budget Indicators of the State Social Insurance Fund of the Republic of Lithuania for that year and methodology approved by the Government of the Republic of Lithuania. If you are not on the list of policyholders in Groups II-IV, you are assigned to the I group of policyholders.

 

  The policyholders who started their business in 2020 are assigned to the I group of policyholders and are subject to 0.14% rate of social insurance contributions.

 

Guarantee fund contributions:

  • 0,16 percent from the person’s estimated salary.

  Guarantee Fund contributions for insured persons are not paid by the Bank of Lithuania, budget institutions, political parties, trade unions, religious communities and partnerships, as insured persons of these policyholders are not provided with the benefits of this fund.

 

Contributions to the long-term work benefit fund:

  • 0,16% from the person's estimated salary, which is not smaller than the minimum monthly salary.

  The Bank of Lithuania and the budgetary institutions do not pay contributions to the long-term work benefit fund for insured persons.

From the person's estimated salary have to be deducted these contributions:

  • Pension social insurance - 8,72%.
  • Illness - 2,09%.
  • Maternity - 1,71%.

 

If an employee participates in the pension accumulation, payments for a cumulative pension from the accrued salary, equal to 2,1% or 3%, are calculated.

  You can find out the exact contribution rate applied to you in your personal “Sodra” account by clicking on "Summaries" and creating a summary of "Relevant information for policyholders".

  Health insurance is performed in accordance with the Law on Health Insurance of the Republic of Lithuania, according to which the employee pays 6,98% health insurance contribution.

  Important! All required contributions to “Sodra” are calculated, deducted and paid by the employer. Social insurance reports indicate which part of the tariff is paid by the employer, and which is paid by the insured person.

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Preferences are not applicable for these types of contributions.

If you cannot pay contributions on time, you can postpone them. To do this, you must:

  1. Provide an application to the “Sodra” department (the recovery of insurance contribution debt is stopped at the day you provide the request with all needed documents).
  2. A “Sodra” department will examine your application in 20 business days and will send you a notification with its decision. If postponing of the payment has been approved, you need to come to the “Sodra” department during a 10 business day period and conclude a debt payment postponement agreement.

 

  If you are subject to EU state aid, applied according to the provisions of the Treaty of European Union (one of the circumstances is a debt of more than 200.000 Euro), you must prepare a report and a business plan (restructuring plan) for the European Commission. Your application, in this case, is reviewed within 40 business days and a notice of decision is sent to you.

  In case your contribution debt payment is postponed, but you fail to execute the conditions of the agreement or fail to pay current payments, the agreement is terminated, the remaining debt is recovered and due interest is calculated.

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Self-employed persons who pay for social security contributions for themselves, on the payment of social security contributions up to a default payment of up to EUR 1 500, may apply to the “Sodra” section with the request to defer the payment of social security arrears. 
“Sodra” department shall, at the latest within 10 working days of receipt of the request, take a decision to defer or postpone the payment of the social security contributions. In this way, the payment of social security contributions may be delayed once per calendar year, subject to the following conditions: 

  • When social security contributions indebtedness is less than or equal to EUR 600, the social security contribution arrears are deferred to up to 4 months; 
  • In the case of social security contributions exceeding EUR 600 but less than or equal to EUR 900, up to a maximum of 6 months; 
  • In the case of social security contributions exceeding EUR 900 but less than or equal to EUR 1 200, up to a maximum of 8 months; 
  • When social security contributions indebtedness exceeds EUR 1 200, but is equal to or less than EUR 1 500, up to one year. 

The arrears of social security contributions start with repayment of the decision to defer payment of the social security arrears in accordance with the terms and conditions set out therein. The compartments shall inform the policyholder in writing of the decision taken within 5 working days of the decision. 
 
Persons may apply to the ‘Sodra’ department on deferral of contributions as soon as possible after the date on which the annual return declaration has to be submitted, i.e. after 1 May.

 

Important! Self-employed persons may not pay compulsory health insurance (CHI) contributions during an emergency and quarantine period and defer their payment for 2 years.

These persons who have not paid CHI contributions during an emergency declared by the Government and during quarantine will be required to pay these contributions for the said period within 2 years from the day of the emergency and quarantine cancellation.

If self-employed persons fail to pay CHI contributions within the set time limit when they have been provided with personal health care services within the set time limit, they will be required to compensate for the damage caused to the budget of the CHI Fund.

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  • If you are planning to employ a foreigner who will arrive in the Republic of Lithuania and work under an employment contract with any type of visa, you must know that he will not be covered by compulsory health insurance.
  • The employer will be required to deduct and pay social insurance contributions for pensions, sickness, maternity social insurance, unemployment, accidents at work and occupational diseases from the salary calculated from him.
  • The employee must to pay the contribution to the guarantee fund. Guarantee fund contributions do not pay by the Bank of Lithuania, budgetary institutions, political parties, trade unions, religious communities and partnerships.
  • The employer must submit a 1-SD notice (announcement of the beginning of state social insurance) informing Sodra about the newly recruited employee about foreigners who come to Lithuania to work under employment contracts with visas of any kind. Notification must be made no later than one working day before the scheduled start of work.
  • Depending on which group of policyholder’s social insurance contribution rates for accidents and occupational diseases your company belongs to, the contribution rate for an employed foreigner is:

From 01-01-2018:

  • Group I - 0.18%.
  • Group II - 0.43%.
  • Group III - 0.9%.
  • Group IV - 1.8%.

From 01-01-2020:

  • Group I - 0.14%.
  • Group II - 0.4%.
  • Group III - 0.7%.
  • Group IV - 1.4%.

 

  The policyholders who started their business in 2020 are assigned to the I group of policyholders and are subject to 0,14% rate of social insurance contributions.

Policyholders are allocated to these groups on an annual basis by the “Sodra” council, following the Law on the Budget Indicators of the State Social Insurance Fund of the Republic of Lithuania for that year and methodology approved by the Order of the Minister of Social Security and Labour of the Republic of Lithuania. If you are not on the list of policyholders in Groups II-IV, you are assigned to the I group of policyholders.

 

  You can find out the exact contribution rate applied to you in your personal “Sodra” account by clicking on "Summaries" and creating a summary of "Relevant information for policyholders".

  Other notification requisites are filled out according to general order in the same way, as they are filled for other persons working under an employment contract.

 

Payment codes:

  1. When you pay for your employees who arrived from abroad and have a visa, the payment code is - 349.
  2. If you pay interest for late payments, the deposit code will be - 350.
  3. If you pay penalties for unlawfully reduced contributions, the code is - 351.
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Update date: 2020-05-11
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