The general social security framework covers civil servants, employed persons with individual labour contracts, as well as self-employed persons and independent artists with annual average income of at least 12 salaries at the level of minimum gross salary (in 2018 this is 1.900 lei and therefore the annual average income should be 22.800 lei). Voluntary coverage for those falling under the threshold is available.
The new provisions of the Fiscal Code that entered into force as of the 1st of January 2018 have brought about important changes in the social security framework for all beneficiaries and in particular for independent artists for which the sole income is derived from copyright and neighbouring rights. These new developments are as of yet difficult to evaluate because the final date for filing the fiscal statements on the basis of which social contributions are calculated was set for the 31st of July 2018.
Briefly, the major change relates to shifting the obligations of calculating and paying social security rates from the employer / beneficiary of the copyright contract to the employee/ independent artist. In addition, the social security taxes have been set to 25% for the mandatory pension fund and 10% for health insurance. It should be noted that for all copyright-derived income there is a lump sum deduction of 40% and therefore only the remaining 60% of the gross income is subject to taxation and to the payment of social security contributions.
One of the major issues that is still unclear is whether the health insurance coverage operates for independent artists during the period elapsed from the moment of receiving the income until paying the contributions pursuant to the Fiscal Administration Decision (next fiscal year). The previous social security system provided the concomitant payment of the income and of the social security charges. Voluntary payment in advance is provided by law, but the administrative mechanism is unclear in this respect and many artists are not familiar with the procedures.
Exemptions from the payment of social security contributions to the pension fund for copyright income are provided for employees (who already contribute to the mandatory pension fund) and for retired persons.