Important news is on the way for those who want to retire, with the opportunity to benefit from periods not covered by employee contributions. This is an experimental measure implemented for the two-year period 2024-2025; It’s a kind of new contributor to peace that will help people leave work early. Let’s see what it is, how it works, who can benefit from it, installments, costs and payment periods in this simple guide.
Who can use uncompensated contribution periods?
Article 27 of the draft budget law titled “Measures regarding the reimbursement of periods not covered by the wage and obligations regarding contribution obligations” introduces the possibility of equalizing the periods not covered at the contribution level on an experimental basis for the two-year period from 2024 to 2025 with the persons for whom the work is performed and covered by the wage. This faculty is not open to everyone, only:
- to those registered in compulsory general insurance for disability, old age and survivors (Previous);
- Needle replacement and special forms;
- private management of self-employed workers;
- Separate management referred to in paragraph 26 of article 2 of the law of 8 August 1995, n. 335.
This opportunity is only valid for those who started paying contributions on or after January 1, 1996 and are therefore subject to calculating their pension using the full contribution method. “As we read in the draft, the subsequent acquisition of insurance seniority before January 1, 1996 means the automatic cancellation of the payment already made in accordance with this article and, as a result, the refund of contributions”.
Those falling into these categories of workers will have the opportunity to recover all or part of the periods before the entry into force of this Law, covering the period between the first contribution deposited in the forms specified above and the last contribution year. “Insurances that are not subject to compulsory contributions and do not fall within the scope of contributions of compulsory types of social security, regardless of how much is paid and credited, and equates them to working hours”.
Application for reimbursement of contribution gaps can be made as follows:
- by the insured;
- by survivors;
- by relatives and in-laws up to the second degree.
Compensation for contribution gaps: how does it work?
By closing contribution gaps, any periods not covered by contribution, even if not continuous, up to a maximum of five years, such as years of graduation or years of unemployment at the end of unemployment benefit, can be ‘corrected’.
So how much does it cost to close contribution gaps? “The insured’s burden on the repayment of contributions is determined on the basis of the criteria established in paragraph 5 of article 2 of the Decree Law No. 184 of April 30, 1997”, states the draft on the contribution rates in force in the regime Reference salary in which the reimbursement comes into force on the date of submission of the application will be the salary received within 12 months shorter than the application date compared to the period subject to repayment. It is recommended to first contact an expert from INPS or the social security sector to assess the costs and benefits when applying.
Payment of the repayment amount can be made to the relevant social security institutions in a single solution or in maximum 120 monthly installments of not less than 30 Euros each, without interest on the installments. If it is mandatory to use the repayment contributions for the immediate payment of direct or indirect retirement, and if installments cannot be foreseen, the burden must be paid in a single solution. On the date of load balancing, INPS will credit the contribution and associated impacts.
The reimbursement cost for private sector employees can also be covered by the employer, who can allocate the production premiums payable to the employee for this purpose. In this case, it can be deducted from business profits and self-employment.
There are other details that are certainly overshadowed in the new budget law, but are no less important. Here they are listed in the special section of Today.it for the 2024 maneuver.
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Source: Today IT
Roy Brown is a renowned economist and author at The Nation View. He has a deep understanding of the global economy and its intricacies. He writes about a wide range of economic topics, including monetary policy, fiscal policy, international trade, and labor markets.
