The standard pay scheme, with 27.91% contributions and 13% tax, covers an employee on a full-time contract and a single employer. Outside this scheme falls a significant portion of actual employment, namely part-time contracts, day-to-day hires, the partner who manages the company, interns, and individuals working in two places.
This page compiles the cases we see most often, shows the rules that apply to each, and clearly marks the points where the rule must be confirmed for the specific situation before a decision is made.
Read also: Full contribution rates, minimum and maximum.
Contribution rates do not depend on the parties' will but on the contract's characteristics, namely the monthly working hours and the duration. Payroll taxes, unlike contributions, always follow the same annual schedule.
| Case | Social, the employer | Social, the employee | Healthy | Total |
|---|---|---|---|---|
| Contract for over 87 hours per month | 15.0% | 9.5% | 1.7% plus 1.7% | 27.9% |
| Contract under 87 hours per month | 13.9% | 9.4% | 1.7% plus 1.7% | 26.7% |
| Contract in under a week | 0.3% | 0% | 1.7% plus 1.7% | 3.7% |
When the contract provides for fewer than 87 working hours per month, social security is applied at reduced rates: 13.9% for the employer and 9.4% for the employee, for a total of 23.3%. Health insurance remains unchanged at 1.7% for each party.
Read also: Indicative salaries in the medical and aesthetic sector.
The 87-hour limit is not an optional cap. It relates to what the contract provides and the hours reported on the payroll, and both must align with each other and with the actual work.
Contract: 60 hours per month, gross salary 30,000 lekë. The employer pays 13.91% plus 1.71%, i.e. 15.61%, which amounts to 4,680 lek. The employee pays 9.41% plus 1.71%, i.e. 11.11%, which amounts to 3,330 lek. The payroll tax is zero, because the annual income of 360,000 lekë is covered by the 600,000-lekë deduction. The employee receives 26,670 lekë, and the business cost is 34,680 lekë.
Caution. The minimum contribution base for contracts under 87 hours—that is, if it falls below the minimum wage of 50,000 lek in proportion to the hours—must be confirmed in the applicable regulation for the specific case. The contribution rates have been verified, but the base has not.
Read also: Step-by-step calculation with gross, net, and cost tables..
For contracts lasting less than one week, social insurance is reduced to only the work accident and occupational disease branch, with 0.3% paid by the employer. The employee does not pay any social contributions. Health insurance remains at 1.71% for each party.
This regime exists precisely for occasional work—such as helping with an inventory, a one-day assembly job, or service at an event. It is not a means to cover an ongoing employment relationship through successive short-term contracts.
Three days of work at an event, gross pay 10,000 lek. The employer pays 0.3% for social security, i.e. 30 lek, plus 1.7% for health insurance, i.e. 170 lek, totaling 200 lek. The employee pays 1.71%, i.e. 170 lek. The employee receives 9,830 lek and the business cost is 10,200 lek.
The person must be declared for three days as well. The fine for undeclared employees is 200,000 lekë for VAT and simplified tax entities, meaning it's multiple times the salary you avoid declaring.
Read also: How to file payroll and what the penalties are.
The person who manages the company and works in it has insurance obligations, even when there is no formal employment contract and even when they do not draw a salary. A company that issues invoices, has clients, and has an active administrator, while its payroll is empty, is among the easiest cases to catch in a control check.
The practice we follow is to declare the administrator at the minimum wage of 50,000 lek when there is no reason for a higher salary, and to increase the base when the actual work and earnings justify it.
Declared managing partner with a minimum salary of 50,000 lek. The payroll tax is zero because 600,000 lek per year is covered by the deduction. The employee's contribution is 5,600 lek, the employer's contribution is 8,350 lek, totaling 13,950 lek per month, or 167,400 lek per year.
Caution. The correct classification of the managing partner's obligation—whether treated as an employee or as self-employed—and the corresponding minimum basis must be confirmed in the applicable statute. The solution is not the same for a company with a single partner and for a company with multiple partners, of whom only one is active.
The partner who receives profit through dividends has a separate obligation, distinct from salary. Dividends are taxed at 81% and do not replace the insurance obligation.
Read also: How to withdraw profit and how much the dividend is taxed.
The intern is not a distinct category in tax law. Treatment depends on the actual nature of the relationship, and the question at hand is simple: Is work performed under the employer's direction, and is there compensation?
✔ When the intern performs work and receives compensation, the relationship is treated as employment and is reflected on the payroll.
✔ When the internship is unpaid and conducted under an educational program, it is treated and regulated by professional internship legislation.
✔ The reward called a “scholarship” or “aid” does not change the nature of the relationship when, in essence, it is payment for work.
✔ The duration and hours of practice determine the contribution rates, just like for any other employee.
Caution. The framework for professional internships, including compensation limits and possible exemptions from contributions, is specific legislation and has not been verified in our legal database. Before you start a paid internship, write to us with the specific terms.
When a person has two employment relationships, each employer withholds tax only on the wages it pays. The result is almost always a smaller withholding than the actual liability, either because the basic deduction is applied twice or because the second wage remains below the taxable threshold.
The deduction is claimed with only one employer. The final adjustment is made on the annual individual return, which is mandatory for this purpose.
Salary of 60,000 lek from employer A and 40,000 lek from employer B. A withholds 3,250 lek per month, so 39,000 lek per year. B pays zero, because 480,000 lekë per year is covered by the 600,000 lekë deduction. The actual liability is calculated on the total, so 1,200,000 lekë minus 360,000 lekë equals 840,000 lekë, and 13% yields 109,200 lekë. With the annual declaration, another 70,200 lekë are paid.
Contributions are withheld by each employer on the respective salary. The social security cap of 186,416 lekë is calculated on the total, so when combined salaries exceed it, an adjustment and refund of the excess are required.
Read also: Who files the DIVA statement and how is dual employment regulated?.
The law provides a test for situations when a person presents themselves as self-employed but works as an employee. When 80% or more of the income comes from a single client, or when 90% or more comes from fewer than three clients, the relationship is reclassified as employment.
Read also: When the self-employed are considered employees.
The consequence is twofold. The individual is treated as an employee for tax and contribution purposes, and the business that paid them as a supplier becomes the employer, with the corresponding obligations and risks.
Consultant registered as self-employed, with annual income of 1,800,000 lek, of which 1,600,000 lek comes from a single client. The portion from a single client is 88.91% of the total, thus exceeding the 80% threshold. The relationship is reclassified as employment, and the client is treated as the employer.
Read also: How the self-employed and liberal professions are taxed.
Social security contributions of 13.91% for the employer and 9.41% for the employee, plus health insurance of 1.71% for each. Total 26.71% of gross pay.
Yes. Filing is mandatory regardless of duration. For contracts under one week, the social contribution is only 0.31% on the employer, so the filing cost is minimal.
Yes. The person who manages and works in the company has a duty of security, even without a traditional employment contract. The exact form and basis are determined according to the company's circumstances.
No. The dividend is taxed at 8.1% and is a separate obligation. Insurance contributions are not replaced by profit distribution.
When you do work and receive compensation, yes. When the internship is unpaid and part of an educational program, the treatment is governed by professional internship legislation and must be verified for the specific case.
Only with one employer, and once a year. Filing with both creates a smaller withholding than necessary and a difference to be paid in March.
Yes. Dual employment makes the annual individual declaration mandatory, even when total income is low.
When 80% or more of the income comes from a single client, or 90% or more from fewer than three clients, then the relationship re-qualifies as employment.
The systematic renewal of very short-term contracts for the same person and the same work indicates a continuous relationship, and the proper treatment would be a regular contract. For your specific case, write to us before you sign them.