New arrivals – January 31, 2019
In recent days, through resolution number 1/325 of the Board of Directors of the Nicaraguan Social Security Institute (INSS), the reform of Articles 11, 16, 26, 27, 29, 58, 85 and 96 of the Regulation of the Social Security Law, in the sense of increasing quotas to finance benefits; which will enter into force on February 1, 2019. This includes the increase in worker and employer quotas, optional insurance quota and also eliminates the maximum limit for the remuneration subject to contribution.
With the new quotas of the comprehensive regime, for companies that have 50 workers or more, they will pay an employer quota of 22.5% of the worker's salary, that is, 3.5 percentage points more than what they currently pay. And for companies that employ less than 50 workers, the employer contribution will rise to 21.5%, which means 2.5% more than what is in force to date.
In the same way, the fee for the Disability, Old Age and Death (IVM) insurance is increased, which goes from 10% to 13.5%; and the contribution for professional risks, contribution to victims of war and sickness and maternity remain at 1.5%, 1.5% and 6%, respectively.
The current quota for workers is 6.25% and from February it will be 7% as payment to the INSS. The current one is divided as follows: 4% is for IVM and 2.25% for illness and maternity. The new one will be divided as follows: 4.75% is for IVM and 2.25% for illness and maternity
About optional insurance – to self-employed workers who voluntarily join the INSS, short, medium and long-term benefits, including medical care, with the exception of work-related accidents, the resolution establishes that it will increase from 18.25% to 22.25%; and in the case of the optional IVM it will go from 10% to 14%.
The new INSS measures also eliminate the maximum quotable salary, which until last year was C$96,841.56 (in Nicaraguan currency) per month.
For more information you can contact us at: nicaragua@latinalliance.co